Why execs need to factor availability into the digital transformation equation
Business Management

Why execs need to factor availability into the digital transformation equation

The following is a contributed article by Richard Agnew, north-west EMEA VP at Veeam

 

At a recent roundtable event with CIOs and IT managers, I was left with one prominent thought. IT departments are under greater strain than ever to deliver better, more efficient IT services with generally smaller budgets and less time – particularly in the public sector. In most cases, these pressures are painted against the backdrop of digital transformations. IT departments everywhere are seeking to keep their business relevant, efficient and competitive in an increasingly fast-moving and connected world.

The statistics demonstrate a mixed picture for organisations irrespective of shape and size. In January, a Gartner report found that worldwide IT spending is forecast to grow just 0.6 percent in 2016. More positively, IT software spending will rise by 5.3 percent on 2015 to $326bn, indicating that demand for software will remain strong even in the face of spending cuts in other areas of IT. On the flip side, the prospect for public sector spend looks more bleak due to a five percent decrease in spending during 2015.

In any case it could be argued that these investments are insufficient when we consider that there will be 21 billion connected devices by the end of 2020. Moreover, when customer-facing services are becoming increasingly digital, the small increases in IT spend are not proportional to the context of our modern surroundings.

It might be because business executives understand the need for digital transformation, but they aren't prepared for how quickly they need to adapt. Further Gartner insight shows that, based on research amongst almost 400 leaders of large companies, three-quarters recognise the need for a digitally-led approach, but few are actively making provisions to ‘make it happen’. Likewise, statistics from Appian suggest that only 14 percent of business executives have fully migrated in line with digital transformation standards.

 

Transformative effects

Digital transformation entails making a change to the mechanisms of a business to embrace new technologies that will result in a more efficient organisation. Today, more than 50 percent of the world operates on virtualised servers and Gartner predicts that by 2018 this will increase to 82 percent. Virtual servers contain massive amounts of data, and in order to avoid data loss it is imperative for businesses to regularly back up their files to ensure constant availability. In this sense, an always-on approach is critical to the success of digital transformation, and it is where executives must centre their strategy.

The IT department has begun to recognise this. According to the 2016 Veeam Availability Report, 84 percent of senior IT decision makers across the globe admit to suffering an ‘Availability Gap’ between what IT can deliver, and what users demand. This has not yet filtered through at a Board level though, as shown by the staggering losses that businesses can face when downtime strikes, because time is, quite literally, money.

Veeam’s findings suggest that such outages of services and data can cost up to $16 million annually. Such a loss may be hard to comprehend. But hourly, in the UK, the average cost of downtime for mission-critical applications is $100,266. Aside from financial loss, there’s the incalculable impact to customer confidence and brand integrity.

However, it seems that enterprises have not received that message. Earlier this year, one of Britain’s biggest banks, HSBC, faced an outage for almost two days, affecting personal and business online banking. For 17 million account holders in the UK, this unplanned outage caused delayed payments, frustration, and the incurring of fees which then had to be reversed by the bank. Waiting for such a high profile case to occur is not the way that Board-level executives should understand their IT flaws.

Another equally important issue is that data recovery for any application requires spending one of the most valuable resources – time. The average downtime of critical applications in the IT systems of UK companies is five hours, which is quite an extended time for an organisation to be offline when it could be as low as 15 minutes.

Being always-on means that there has to be a continuation of services irrespective the crisis that occurs. Continuity is critical.

Thanks to new, high-quality solutions that make it both affordable and easier than ever before to prevent the loss of data, it is no longer the case that businesses have to choose between optimising their budget or safeguarding their data. The need for availability of information around the clock is becoming a reality for millions of entrepreneurs around the world, paving the way for the era of the always-on business.

From a public sector perspective, government departments need a way to support aggressive recovery time and recovery point objectives. Providing citizens with access to these are essential as is maintaining the processes which keep the country functioning. Similar to a large organisation, the public sector has to have enterprise-class performance and responsiveness across wide geographic areas at a fraction of the cost. The transition to a seamless business continuity experience might not be the easiest to do – or the cheapest – but it underpins everything around it.

Availability – and the always-on mindset – are becoming increasingly mainstream. While Boards are squeezing budgets and expecting more from their IT deployments, they need to focus attention on the core principles that will underpin a digital transformation strategy, while ensuring there are no hiccups en route. Ensuring constant availability of services and data is the way to do that.

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