Think before pink: Cut IT now ... and pay later

Downturn, slowdown, meltdown: Call it what you will, but the current economic crisis is placing almost unprecedented pressure on companies to cut costs. One key area in which resources are becoming stretched is IT—the consequences of which might only become apparent when disaster strikes.

12/08/2008



Downturn, slowdown, meltdown: Call it what you will, but the current economic crisis is placing almost unprecedented pressure on companies to cut costs. One key area in which resources are becoming stretched is IT—the consequences of which might only become apparent when disaster strikes.

With the outlook for the world economy continuing to look bleak, many organisations are predictably taking a hard look at their IT expenditures to identify projects that can be cut or deferred. The reality, however, is that business needs for available data and regulatory compliance obligations do not decline in step with an economic downturn.

"Focused on short-term pressures to make budget cuts, it often escapes companies that disaster preparedness needs may actually be greater during times of economic duress," says William DiMartini, senior vice president of consulting services at U.S.-based SunGard Availability Services .

"For example, many organisations are reducing costs by consolidating equipment, but because of compliance and a plethora of other requirements, data must still be retained—even with a cap on spending."

The bottom-line consequences of failing to maintain an effective business continuity plan are indicated in a study undertaken by Suncorp in the U.K., which found that just a third of small- to medium-size enterprises (SME) are now taking active steps to ensure their business will continue to operate normally in the event of a disruption.

From those surveyed, 40 percent said a computer hardware failure or malicious attack on their systems would be detrimental to their business, while only 10 percent said they would be able to function as normal.

In the U.S., an annual study on business continuity and disaster preparedness by AT&T found that in 2008 one in five businesses do not have a business continuity plan in place. Arguably of even greater concern is that for the third year in a row the study found that nearly 30 percent of U.S. businesses do not consider business continuity planning a priority.

AT&T canvassed the views of IT executives from companies throughout the U.S. that have at least (US) $25 million ($39 million) in annual revenue, and found that two-thirds predict hacking will be the biggest threat in the next five years. The next most frequently cited threats are internal: accidents (56 percent); sabotage (47 percent); and remote workers (44 percent). Further, while six out of 10 companies have made some type of business change in the past year, only 28 percent updated their business continuity plans.

The risks they run are acute, and graphically highlighted in the 2007 Best's Underwriting Guide by AM Best , which revealed that only 6 percent of companies that suffer catastrophic data loss survive, while 43 percent never reopen and 51 percent close within two years of the disaster.

According to DiMartini, a veteran of more than 20 years in disaster planning and recovery, when reviewing corporate IT programs, there are three core issues integral to optimal preparedness:

1) What are the risks?

2) Which programs must be maintained and how can they be most effectively maintained?

3)

Make risk assessments a priority

"As organisations are challenged to scrutinise how to spend their dollars, conducting availability risk assessments to identify vulnerabilities can provide excellent guides on how to determine budget priorities," DiMartini says.

However, he says it is essential to measure and assess three major areas: information security—covering policy, procedure and regulatory response; information management—examining program controls, flow of information and continuity of services—and information architecture— looking at network and facility design, environmental infrastructure and system design.

Keep essential programs going

Typically, during an economic downturn, internal IT resources become stretched. This leads to companies looking for outside support to fill gaps to get essential work done and still save money. One key area in which third party providers can have positive input is maintaining and testing disaster recovery plans.

Importantly, disaster recovery plans need to be viewed as ongoing programs—not projects that can be put on a shelf for a year.

Another area that often faces cutbacks in tight budgetary times is recovery environments. However, when companies are pressured to scale back an IT recovery site it often leads to the recovery installation not matching the current production environment.

The result is that critical applications can no longer be supported at recovery sites. To address the issue, companies can leverage third party-managed services that host secondary applications at a third party site and protect data with disaster recovery solutions.

Keep abreast of changing technology
As is well known, many organisations are now moving to virtualisation technologies to generate IT cost savings by consolidating servers and storage.

But moving to such environments with untested plans to recover data should an unplanned outage occur can turn a problem into a disaster that impacts on an entire company.

"Data managed by virtualised systems still needs to be accessible," DiMartini warns. "Business continuity plans need to be updated to account for virtual environments to assure information availability."







No comments
The Engineers' Choice Awards highlight some of the best new control, instrumentation and automation products as chosen by...
The System Integrator Giants program lists the top 100 system integrators among companies listed in CFE Media's Global System Integrator Database.
The Engineering Leaders Under 40 program identifies and gives recognition to young engineers who...
This eGuide illustrates solutions, applications and benefits of machine vision systems.
Learn how to increase device reliability in harsh environments and decrease unplanned system downtime.
This eGuide contains a series of articles and videos that considers theoretical and practical; immediate needs and a look into the future.
Robotic safety, collaboration, standards; DCS migration tips; IT/OT convergence; 2017 Control Engineering Salary and Career Survey
Integrated mobility; Artificial intelligence; Predictive motion control; Sensors and control system inputs; Asset Management; Cybersecurity
Big Data and IIoT value; Monitoring Big Data; Robotics safety standards and programming; Learning about PID
Featured articles highlight technologies that enable the Industrial Internet of Things, IIoT-related products and strategies to get data more easily to the user.
This article collection contains several articles on how automation and controls are helping human-machine interface (HMI) hardware and software advance.
This digital report will explore several aspects of how IIoT will transform manufacturing in the coming years.

Find and connect with the most suitable service provider for your unique application. Start searching the Global System Integrator Database Now!

Mobility as the means to offshore innovation; Preventing another Deepwater Horizon; ROVs as subsea robots; SCADA and the radio spectrum
Future of oil and gas projects; Reservoir models; The importance of SCADA to oil and gas
Big Data and bigger solutions; Tablet technologies; SCADA developments
Automation Engineer; Wood Group
System Integrator; Cross Integrated Systems Group
Jose S. Vasquez, Jr.
Fire & Life Safety Engineer; Technip USA Inc.
This course focuses on climate analysis, appropriateness of cooling system selection, and combining cooling systems.
This course will help identify and reveal electrical hazards and identify the solutions to implementing and maintaining a safe work environment.
This course explains how maintaining power and communication systems through emergency power-generation systems is critical.
click me