4 Real-world IT outages and the lessons they can teach you

4 Real-world IT outages and the lessons they can teach you

Technical outages are costly and devastating, especially if you don't have an effective IT strategy in place. When your network or servers unexpectedly crash, IT downtime can directly impact your bottom line. In extreme scenarios, data and monetary losses from unplanned outages can even cause a company to go out of business.

According to Gartner, the average cost of IT downtime could go as high as $5,600 a minute which translates up to $300,000 per hour on average. Beyond monetary costs, IT downtime reduces business productivity levels because it takes half an hour or more to get back on track after a system has been restored.

Nailing down the exact cost of IT downtime for your business is difficult. For example, losses could be higher per hour for businesses that are built on high-level data transactions such as banks and healthcare institutions. Or, if you experience a sudden outage during peak hours, the damage will be more significant.

In the second quarter of 2018, massive financial, communications, healthcare, and technology companies suffered from system outages that left them to deal with severe damage control.

Small businesses can learn a lot from massive outage incidents and implement strategies to avoid the negative impact of downtime. Here are some of the top outages that hit major companies in 2018 so far:

IT outages in the news

  • Sutter Health – An activated fire suspension system led to a 24-hour outage on May 14, 2018 at the Alta Bates Hospital in California, which was forced to cancel surgeries and refuse patients in the emergency room. Sutter Health's electronic health record system went down for all 24 of the hospitals it manages. Unfortunately, Sutter's contingency plan was not effective, forcing hospital staff to use pen and paper for records and transactions.

  • National Australia Bank – Because of an electrical failure, National Australia Bank (NAB) customers relying on its online, mobile, ATM, and point-of-sale (PoS) services were unable to pay. Even though the outage lasted only five hours, the incident cost NAB thousands of dollars. NAB made it up to their customers by compensating for the losses and allowed them to approach the bank with their complaints.

  • Visa – Owing to a “rare” datacenter switch fault that was essentially a hardware failure, consumers and stores across the UK suffered payment chaos that lasted for 10 hours. According to Visa, the widespread outage was not the result of unauthorized access, but the credit card vendor advised consumers to carry backup payment options and be wary of calls and emails related to the network failure.

  • Comcast – Soon after a previous outage, Comcast was hit a second time on June 29, affecting some of its internet, video, and voice customers due to a cut at a backbone network. The company was able to restore service later on the same day.

What SMBs can learn from these IT outages

These incidents highlight how just a few hours of downtime can have enormous reputational costs. Regardless of the size of an organization, downtime can cost you thousands, if not millions, of dollars. Here's a closer look at the the common causes of downtime and how Connecticut SMBs can avoid them:

  • Human error – Over the last several years, various studies have placed human error as one of the most frequent causes of downtime. Whether by accident or negligence, many system outages can be directly traced back to human error.

    What you can do: While it's impossible to completely guard against human error, significant steps such as accurate documentation, imposing more stringent policies on device usage, and constant employee training could thwart the likeliness of an outage.

  • Outdated hardware – If your business is using old desktops and servers, IT problems such as data traffic congestion and the inability to execute complex applications will arise.

    What you can do: Many small organizations are learning to adopt modern technologies such as cloud computing, which helps them get rid of unnecessary hardware problems.

  • Software failure – Huge problems can arise from neglecting basic software updates. This leads to the corruption of applications that can bring down an entire system or render them unavailable. In addition, outdated operating systems can be a target for cybercrime or cyber attacks.

    What you can do: Make sure to apply fixes in a timely and consistent manner and use a preventive approach when managing your systems.

  • Natural disasters – Fires, floods, or earthquakes pose significant dangers to networks, as these could lead to disruptive power outages.

    What you can do: To cope with server downtime, take precautions to protect your systems by implementing a robust backup plan. Make sure your backups have backups as well.

When you are prepared for an unexpected IT system outage, downtime can be significantly diminished or prevented entirely. By outsourcing the daily maintenance of your IT infrastructure, you can focus more on other important areas of your business.

Charles IT proactively monitors issues and can detect and solve potential challenges before they can disrupt operations and productivity. If an issue does arise, we have in-depth knowledge and proven expertise on backup and disaster recovery, which will ensure that you can quickly recover and revive your network and that no time is wasted with your employees. Give us a call today to learn more.