Data loss can cause operational issues that can have a significant cost on businesses. And we’re not only talking about the loss of business, but also the cost of recovering the lost data. But can you protect yourself from this misfortune?
All companies, from small businesses to multinationals to the home user are all subject to the daily whims of their computer. Although the causes, as well as the results of such quirks are many, one of the worst is something that causes loss of data. And the effects of data loss are also plentiful. Loss of revenue due to missed sales opportunities is the obvious, but we must also take into account the fixed operating costs such as staff, premises, equipment, etc. And of course the necessary evil of paying for the recovery of the data. In some cases, such incidences can cause businesses to go out of business altogether. And all these costs and effects in mind, we have to highlight that in more than 30% of cases, the cause of all this is human error.
Just how do we lose data?
In larger companies, the person responsible for the system in general is the IT manager. He is the internal-first point of call for anything regarding computers and is in charge of risk analysis and possible solutions. However, according to a survey by Ipsos (1) in September 2012, in more than a third of SMB’s (small and medium sized business) with less than 10 workers the person responsible for the IT of the business is an employee without any specific IT qualifications.
But whatever the situation, what are the statistics regarding data loss? The figures related to data loss within our company show that while with traditional IT systems 74% of is due to hardware and 26% human error, with virtual systems 35% is mechanical and 65% is human error. Virtual systems hence seem the more reliable option, but there is obviously a lack of employee training somewhere.
According to a study of US companies by Forrester Research and the Disaster Recovery Journal (2) in 2011, the figures reflecting data loss as a cause of human error are considerably lower, at 13%. This figure takes into account businesses in which data recovery operations are carried out internally and where human error is minimised as employees are aware that they can be fired if they are responsible for loss of data.
Is the decision making chain the issue?
The issue of human error isn’t only an issue of actual mistakes, far from it. Human error could, in fact, be accountable for 95% of data loss. For instance, when a company is new, things tend to run more smoothly and there are less IT related problems. Over time, however, things change. Teams change, new employees appear and gradually knowledge of the IT system dwindles. Backups are performed, but often before valuable software is updated. Not even the minimum system maintenance is carried out, and financial decisions to renew and replace are put off and delayed. In short, the blame lies with the company itself for not introducing a constant management process regarding IT. And the consequences of these actions, or lack of, can be considerable…
…And for others, a catastrophe
Results of some of the highest costs of annual data recovery for businesses were also included in the study by Forrester Research. In a company with less than 99 employees, costs can reach around 4-7 million euros, and more than 15 million in companies with 1,000+ employees. These figures reflect recovery costs as well as the cost of loss of operations. For 15% of companies surveyed the cost of such a situation is estimated to be around €120,000 per hour.
Are Clouds to be considered an additional risk?
Using a Cloud provider as a means of outsourcing IT solutions is often a point of controversy when talking about the stability, reliability and security of data. In fact, Clouds are not an additional risk. The stability, reliability and security of the data depend on the provider, the services chosen, and the commitments of the provider according to the contract. Clouds are virtual systems and this fact can simply mean that operating costs, such as those of engineering, can be reduced. As with all things, it is simply a matter of knowing the risks and, of course, accepting them.
Prevention is better than cure
In order to prevent data loss in the first place, most larger companies have a Business Continuity Plan (BCP) and/or Disaster Recovery Plan (DRP) in place. However, some often neglect to perform tests of such plans, or even update them and this, again, carries large risks with virtual computing. These plans often find themselves being christened and tested at the same time.
For smaller businesses, the opportunity to look back in regret is often all that there is. The Forrester Research study also tells us that 32% of small businesses are somewhat prepared and 8% have no plan in place at all. The study doesn’t give us any information on those that are prepared and have had the opportunity to put their plan into action.
The main idea of such plans is to have a well thought-through strategy to protect the vital processes of each individual company. A backup is obviously one of the strategies, but the theme of ‘backups’ is very extensive. One of the issues with backups is that saving a backup to a traditional system isn’t comparable to saving a backup on a virtual system. A simple example of this is the fact that a virtual hard disk contains data and applications that is, quite simply, an ensemble of virtual information.
If the only backup isn’t set as a virtual hard drive, the absence of a virtual structure in operational mode in a traditional system could result in data layers being mixed and hence result in damage to the virtual machine. Recovering data related to business applications is then much more complex.
In conclusion, data loss is not unavoidable. You simply have to analyse the risks, competently and professionally manage them, and have a redundant backups on different media. When everything is well thought out, a simple restoration can restore all that was lost, on both traditional and virtual systems.