Business Risks of Application Downtime

Lost productivity

If staff cannot perform their job function due to applications being offline, then there is an obvious hit on productivity. This downtime will often have additional knock-on effects for others in the organization or business partners when workflows get blocked by an offline application. In extreme cases, application downtime can lead to shutdowns on the factory floor in manufacturing businesses. Incidents like this are very costly both in direct lost production, and there can be additional costs restarting a production line.

Reputational damage

Downtime to an application that clients or business partners rely on can result in significant reputational damage. People using applications expect a seamless experience, and any interruption to services can (and will) drive them to other services and competitors. This is especially true if outages are frequent. Reputational damage gets compounded if the downtime is due to a cyber attack that also results in a data breach. 

Lost sales

A direct result of the statement above about people moving to other services when they don't get the experience they expect is lost sales in an online shopping application. Information shows that 50% of customers will abandon their online shopping carts if web pages don't load in six seconds (ref 1). This shows that an application doesn't have to be offline completely to have an adverse impact. It can also lead to lost sales and revenue if the application is slow to respond. If an application is slow, that's equivalent to downtime. 

Missed business opportunities

In addition to direct loss of sales, an offline or slow application with a poor user experience will lead to missed business opportunities. Potential clients using your web application as part of their product evaluation process will move on to competitors if their user experience is not top-notch. The same is true for potential B2B partners using your online applications to see if they could work with your organization. 

Hidden costs

On top of lost sales, there are many other costs that accrue when there is unplanned application downtime. One cost often overlooked is the IT team's time and resources to analyze, troubleshoot, and fix any issue. When doing this in response to an emergency, they are not doing other planned activities and projects designed to improve the business. Downtime often results in staff working in manual ways via paper records for the duration of the outage, and then having to revisit activities that they recorded on paper to input them into the applications when they are available again. The costs of a downtime incident in dollars can range from low five figures up to high six-figure sums for larger organizations if the outage is severe. For Fortune 1000 companies, downtime costs can even be millions of dollars per hour (ref 1).

By deploying LoadMaster load balancers to manage access to your application servers, you can essentially eliminate the risk of unplanned downtime for on-premise applications. Also, by deploying Global Server Load Balancing (GSLB), you can load balance applications across geographically spread data centers to mitigate the risk of a disaster taking a complete location offline. See ref 2 linked below for more details on Kemp LoadMaster.

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