The document outlines the catastrophic consequences of IT failures, highlighting that the potential costs of outages can be astronomical, ranging from loss of income to severe damage to reputation. It emphasizes the importance of preventing IT outages, as they can significantly impact customer relationships and business continuity. The summary includes statistics on the financial implications of various IT failures and urges organizations not to risk their reputation or future growth due to negligent IT management.

1. 7 catastrophic
consequences
of IT failure
The potential cost of an IT outage can
be astronomical. Learn how IT failure
can have calamitous consequences,
and why it’s better to be safe than sorry.
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System outages are an (almost)
inevitable part of the working week.

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Sometimes these
outages only last
a few minutes
– more of an
annoyance than
a major problem:
Email is delayed
Printer queue is full
Temporary loss
of access to the
company file server
Overall effect: Minimal

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Other IT outages are
incredibly serious.

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An email outage
that means your sales team
miss an important tender
deadline.
#1

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Result: Loss
of income
#1

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Common sense.
If you can’t get the paperwork
in on time, the deal is lost.
Proof

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186 million.
The number of emails
generated by a test error that
crashed the NHSmail system.

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A ransomware infection
encrypts critical corporate data.
#2

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Result: Ransom
cost, time to
restore operations,
and damage to
brand reputation.
#2

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58%of consumers said they’d
avoid a provider that has
recently experienced a data
or security breach.
Proof
Source: Kaspersky Lab

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Proof
And the number of
ransomware emails
increased by
6,000%
in 2016.

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Example: Reckitt
Benckiser,
manufacturer of
Nurofen and Dettol,
lost an estimated £100 million
in the Petya cyber attack.
Proof

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A failed disk array
takes your line-of-business
applications offline.
#3

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Result: Loss of
income, customer
relationships
affected,
unexpected IT
costs.
#3

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The average cost
of downtime is
about $100,000
per hour
Proof

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$1.6
although it can go as high as
Proof
Source: IDC
million per hour for
some organisations.

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A loss of connectivity
means that you are unable to fulfil
obligations to customers.
#4

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Result: Loss of
income, financial
penalties.
#4

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Proof
Legally your customer
can sue you for breach
of contract if you fail to
fulfil your obligations.

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Example:
Reservations
management
company Navitaire
forked out $20 million AUD to
Virgin Blue due to a systems
failure.
Proof

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The internal
communications system
fails, and distributed workers are
unable to collaborate.
#5

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Result: Important
information not
shared, loss
of productivity,
missed deadlines.
#5

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$17,000 per incident
The average cost of unplanned downtime is
Proof
Source: Industry Week

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$62 billion.
The cost of BP’s Deepwater
Horizon accident, which
a White House report
concluded was partly
caused by internal
communications failures.
Example

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The web server crashes,
taking the company website offline.
#6

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Result: Loss of
income, damage
to reputation, loss
of customers.
#6

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$5 million.
The loss felt by
Amazon when its
site went down for
just 40 minutes.
#6

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The company network
is hacked and key IP
stolen.
#7

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Result: Loss of
future earnings,
reputation
damage, loss of
customers – even
loss of your job.
#7

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The average
security breach
in the UK costs
£2.37 million.
Proof
Source: IPonemon/IBM

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– TalkTalk’s losses after
an IT hack.
£60 million and
101,000 customers
Example

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Two ministers
were sacked by
the Swedish PM
for their part in a
data leak.
Example

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To restore an
organisation’s
reputation takes on
average about one
year (11.8 months)
after losing a
customer's data.
Proof
Source: Ponemon

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How much are you
willing to risk?
The impact of an outage may last months or years
– if your business survives

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Can you really afford to risk...
Your reputation? Your customers? Your way of
doing business?

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No matter how big
the saving,
taking these risks is
irresponsible – and your
business may never recover.

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Takeaways
Lose customers
Damage your reputation
Hurt your cash flow
Limit future growth
Threaten your very
existence
IT outages:

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Your IT is far too important to leave
to chance. Discover the secret to
keeping your systems safe in our
complimentary playbook:
The Out Of Shape CIO: How
to transform the health of
your IT with customer-centric
managed IT service.
Download playbook