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SURVEY UNCOVERS HIGH COSTS OF COMPUTER DOWNTIME; AMERICAN BUSINESSES LOSING BILLIONS

 SURVEY UNCOVERS HIGH COSTS OF COMPUTER DOWNTIME;
 AMERICAN BUSINESSES LOSING BILLIONS
 MARLBORO, Mass., July 28 /PRNewswire/ -- In a first-of-its-kind survey, business leaders nationwide have indicated that computed downtime has a direct impact on corporate America's bottom line, costing American businesses at least $4 billion last year alone. Those companies able to quantify the cost of downtime reported an average of $3 million annual losses due to computer failure. With businesses' increased reliance on computers, these numbers are likely to grow.
 The business leaders surveyed also perceived that customer dissatisfaction and lost productivity due to computer downtime had greater negative impact than the quantifiable loss of revenue due to downtime. Lost customers, dissatisfied corporate management, and lost data were other impacts cited.
 The research, funded by Stratus Computer (NYSE: SRA), identifies and quantifies the major costs of computer downtime -- measuring economic impacts and putting them into perspective. The sample consisted of 450 information systems (IS) executives from Fortune 1000-sized companies in seven key industries. The survey participants were polled about the costs and other impacts of online computer system failures.
 While the cost of a minute of computer system downtime on Wall Street, for example, is widely known to be calculated in the millions, the survey demonstrates general businesses' increased reliance upon online applications to deliver more services, and the ensuing risk factor of having these systems fail. Economic Impacts
 Revenues were severely impacted as computer downtime resulted in lost business transactions, failure to deliver a customer service, failure to complete production or delivery, failure to earn fees per transaction and failure to retrieve data. These businesses lost $3.4 billion in annual revenues due to unplanned computer downtime. An average hourly revenue loss of $78,191 was experienced, while some individual companies reported losses of $500,000 or more per hour of downtime.
 Productivity costs associated with computer downtime also had a significant impact on the bottom line. The survey found that for major businesses in the U.S. workers were idled 37.3 million hours last year translating into more than $400 million in lost productivity (average hourly wage equals $10.53)(a).
 Productivity costs coupled with lost revenue bring total losses to at least $4 billion. The net impact resulted in an average loss of approximately $330,000 per outage.
 These figures do not reflect overtime costs, which nearly 60 percent of companies surveyed experienced, nor does it include lost customers (23.1 percent experience) or fines (7.6 percent experience).
 "Information systems today are fully integrated into most corporation's primary business functions," said Bill Foster, president and CEO, Stratus. "Even brief outages can have devastating effects."
 The study points out that an overwhelming majority of businesses are becoming more reliant on online computer systems and perhaps do not fully recognize the impact of everyday computer downtime. Because of this increased exposure, particularly where customers are involved, the threat of downtime is a bigger gamble than ever before.
 "With today's economy putting the squeeze on most businesses, losses of this magnitude have an even greater impact," Foster added. Frequency of Downtime Has Far-reaching Effects
 Survey results are based on a representative sampling from senior IS executives from major corporations in the telecommunications, travel/transportation, insurance, manufacturing, banking, securities and retail industries. Other major findings include:
 -- Unplanned system downtime (a computer crash) occurs nine times per year, per company, on the average.
 -- Each time unplanned outages occur, systems are down an average of four hours.
 -- IS executives perceived customer dissatisfaction and lost productivity to have the most negative impacts on business when online systems fail.
 -- Management dissatisfaction (87.1 percent), overtime costs (59.3 percent), and lost revenues (41.8 percent) were also named as significant problems for major U.S. businesses. Losses on the Rise
 Respondents also indicated that downtime would continue to grow as an important issue: 75 percent of IS executives feel they will become increasingly more dependent on these systems. In addition, the survey also indicated that many companies will become more reliant upon data communications networks, and that increased dependency on networking will leave them more exposed to online system failures than before.
 "As business practices move toward the real-time demands of customers, more systems will go online, requiring uninterrupted processing. In this environment, every transaction must be considered critical if you're going to remain competitive," said Foster. "Increasingly, computers are actually running the business, literally are the business, as opposed to past times when computers were used for tracking business after the fact."
 The survey was conducted by the Strategic Research Division of FIND/SVP, a worldwide research and information corporation headquartered in New York.
 Stratus Computer, Inc. is a leading supplier of fault-tolerant computer systems for critical online applications, such as online transaction processing, online data communications, and telecommunications. The company offers the broadest range of fault- tolerant systems and maintains the highest standard for computer reliability.
 One of the fastest-growing companies in the industry, Stratus reported revenues of $448.6 million for fiscal year 1991, up 11 percent from $403.9 million in 1990. The company, headquartered in Marlboro, markets its systems in more than 40 countries.
 (Stratus and the Stratus logo are registered trademarks of Stratus Computer Inc.)
 (a) U.S. Department of Labor Statistics
 -0- 7/28/92
 /CONTACT: David Hayward of Stratus, 508-460-2796, or Shawn A. Sullivan of Leonard Monahan Lubars & Kelly, 401-277-9020, for Stratus Computer/
 (SRA) CO: Stratus Computer, Inc. ST: Massachusetts IN: CPR SU:


CH -- NE001 -- 3865 07/28/92 08:59 EDT
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Date:Jul 28, 1992
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