A President's Advice - Good For IT?

One of my favorite quotes is attributed to former President Dwight D. Eisenhower, when he said “Plans are nothing, planning is everything.” Recently, a large customer of mine had a major database failure, bringing operations to a crawl. More importantly, this database housed critical customer information and due to the size of the organization, full backups were completed only periodically with differentials more frequent.

Many years ago, while working with an internal corporate IT department, I recall regularly performing tape back-ups of filestores and databases. While it was a relatively straightforward process, restoration was a different story. On one slow day, I decided to go back into the archives to see what would happen if we needed files from old backups. I was surprised to find that 30% of the tapes could not be read, or were missing a bulk of the data. While the technology has improved significantly since then, and best practices have been refined, I suspect that the real-world implementation of the two lag far behind. In other words, organizations know what to do, they just don’t do it. Unfortunately this can be costly…

• In a 1996 study conducted by the Contingency Planning Research organization, they found that the hourly cost of downtime associated with lost data can range from $18,000 for a small business, to $6.5m for a Retail Brokerage.



• According to an article published in the Disaster Recovery Journal, Fall 2001, “Only 6 percent of companies suffering from a catastrophic data loss survive… 43 percent never reopen, and the remaining 51% reopen only to close within two years.”



• In a USC study conducted by Ian Mitroff, professor of Business Policy, interviews and surveys about crisis planning conducted with Fortune 500 companies found the following: During a three-year period, proactive companies [those who did not need a crisis to occur before preparations and planning] averaged fewer crises than reactive organizations, 22 compared to 33. The average return on assets for proactive firms was higher than that of reactive ones, 6 percent versus 2 percent.