Disaster Recovery: How to calculate the costs of a failure
All companies They need to have a good backup and a disaster recovery planThere is always the possibility that your business will experience a temporary interruption, so you need to be as prepared as possible. Given this premise, we want to show you what the costs associated with a disaster are and the consequences of not having a Disaster Recovery Strategy (DR).
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Types of costs in the event of a disaster
It's time to teach you what the main costs of a disaster are and how you can learn to calculate them.
Fixed costs
When your company's business activity stops, costs such as the salary of employees involved in activities affected by the disaster are affected. In addition, you will have to bear the costs arising from the IT services supplies that have been interrupted.
To calculate this cost, multiply the number of hours the service has been interrupted by the cost of labor per hour and the cost of supplies per hour.
Loss of expected income
Not only do you have to count the cost of an interruption, but also the income that you stop generating. Without access to files, data, or entire systems, your business will not be able to operate normally.
To calculate the revenue you are not billing for, simply multiply the number of hours in which the service has been interrupted by the average revenue your organization earns in an hour.
Lost potential customers
This cost is imprecise to calculate and depends greatly on the type of sector in which you operate and the direction of your business. What is clear is that You will lose business opportunities.
To calculate them, multiply your annual revenue by your business growth estimates. Then, divide the total by the number of business hours per year. Once you have that value, you can calculate the loss of opportunities due to lost leads. Multiply the number of service interruption hours by the value obtained.
Restore service
It is also important to consider the costs associated with detecting the fault, as well as those associated with containment and protection. Then will come the amounts associated with restoration of the system, which includes the replacement or repair of the infrastructure.
Finally, we must consider the damage caused by both image value, such as recognition, which are difficult to quantify.
The costs arising from the lack of DR
As you have already seen, a failure in your systems will have, in addition to the possible loss of data and files, dire consequences for your company's productivity and revenue generation.
One of the keys to reducing these costs is to improve the RTO and RPO of your Disaster Recovery plan, that is, the acting and recovery times.
Ultimately, A DR plan serves to prevent data loss and optimize operational recovery, so it is important create a disaster recovery plan adapted to your needs to avoid further negative consequences in the event of a system failure.
And you, do you have a DR plan? If you have any questions on the subject or want us to help you prepare your Disaster Recovery plan, contact usWe will be happy to advise you!
