When companies plan to deal with events that can destroy a business -- fire, flood, hurricanes, etc. -- the plan often puts information processing among the top priorities. And with good reason.
Many businesses simply can’t run without their computer systems. For them, information processing is mission critical -- a vital part of keeping the doors open. Consider a mail-order house, insurance claims processor or any management information service. In each case, providing service depends on computer power; without it, the company is helpless.
That’s increasingly true of most businesses, even those where information processing appears less critical. What would the impact be if you lost your computer for four hours? A day? A week? How much business would you lose over that period? Even more important, how much future business would you lose if customers turned to another supplier while you were out of commission, and never returned? Consider hidden costs, too, such as customer dissatisfaction and loss of confidence in your ability to deliver at critical times.
It’s not surprising that the life expectancy of a business without its information processing system is measured in days. Almost half the enterprises that are struck by a business-stopping disaster never reopen, and an additional 29 percent go out of business within two years.
How can you beat the odds? By putting information processing at the top of your disaster recovery plan. But as with any business service, it pays to do some research. Not every company that offers disaster recovery service for your computer system is prepared to deliver what you need. Consider these points:
- Configuration. Ensure that the service provider will supply a computer configured to match your existing system. It must function identically when running your mission-critical applications in order to get you up and running again. And it should arrive with the most recent operating system pre-loaded and ready to run.
- Response time. How fast will the computer reach you? Without a disaster recovery plan, you face two options: locating a used computer that will meet your needs, or asking the manufacturer of your computer system to send you the next new one off the assembly line. In most cases, count on either option taking weeks -- weeks during which your company may be withering on the vine.
- Time to resume processing. Keep in mind you don’t just need a box; you need it up and running so your business can continue. That’s your goal. Some providers will send a machine to you with lightning speed, but that only solves half the problem. Then you need to load your software and data and make it run. Focus not just on replacing hardware; focus on ensuring continuity of your business.
- A turnkey solution. Obviously, your information processing needs are just a small part of what it will take to resume business operations in the face of a disaster. You will face 1,000 other questions as well: personnel, facilities, insurance claims, etc. At such a time, it pays to be able to make a single phone call to arrange for the exact equipment you need, with a field engineer who will install the system on site. Let your disaster recovery vendor handle that burden, freeing you for other concerns.
- Cost. Traditionally, the cost of a disaster recovery service for information processing has run high: up to ten percent of a company’s annual data processing budget to set up a plan, and one to 2 percent per year to maintain it. But for many smaller companies, the figure can be brought down significantly. The key is to find a provider -- often a hardware manufacturer -- who’s able to leverage existing investments. A company that already operates service response centers, and one that specializes in your type of equipment and operating system, can probably offer disaster recovery services at minimal extra cost. Unlike a third-party service provider, it doesn’t have to maintain 20,000-square-foot data centers across the country with machines in dozens of different configurations.
- Insurance considerations. A disaster recovery plan is strongly considered when an underwriter develops an overall business insurance policy. How prepared a business is to recover from a disaster will clearly be reflected in the premium. Check with your insurance provider for more information. Don’t make the mistake of assuming business interruption insurance takes the place of good disaster recovery planning. Insurance can replace some immediate lost income, and reimburse you for physical damage. But it can’t keep your business whole. Replacing lost income for a week or two won’t ensure the future health of your company.
- Testing. To ensure the plan will work when it’s needed, your provider should offer regular tests of the hardware and software that would be rushed to your doorstep in the event of an emergency. Arrange to take backup tapes of your data and load them into the system, then attempt some routine processing. This is particularly important as the company upgrades the hardware it maintains on your behalf, and new releases of the operating system hit the market.
The first step, of course, is designing an overall disaster recovery plan. As part of that plan, identify what parts of your business must be running at any cost. That usually includes recovery of your information processing systems, and your system provider is a good place to start planning what disaster recovery will entail for you.
Today, only one-third of Fortune 500 firms have disaster recovery plans. Your company should definitely be one of them.
Bob Simon is Manager, Professional Services, Applied Digital Data Systems, Inc. in Carlsbad, Calif.