UK plc wastes over £63bn per year in technology downtime costs
New research highlights how British companies are risking their businesses by not effectively supporting their technology
READING, Berkshire. – 17 November 2004 - A new survey of British business today revealed that 66% of the firms surveyed have experienced technology 'downtime' in the last two years with nearly two-thirds of those suffering at least once every three months. With 81% of firms taking up to half a day to fix the problem, the UK's small to medium business sector could be wasting as much as £63.855 billion* per annum, equating to nearly 3% of the total revenue generated by this business sector. The costs consist of lost sales, reduced customer satisfaction, cost of fixing the problem and lost opportunity costs for companies that could be focusing on their revenue but instead have to spend valuable time fixing their technology.
"Technology downtime can be caused in a number of ways – from things like servers failing to simple human error," said Neil Vickers, Support Manager at Microsoft Limited. "However, in the same way we all have house or car insurance, companies need to be planning for the worst and ensuring they can get fast support from the experts."
The survey also revealed that just 20% of companies support their own operations with expert external support or backup in case their technology fails, yet 88% of them recognise their businesses could not operate without IT.
"Good support will help companies avoid downtime through effective planning as well as manage the problems when they surface. That is what Microsoft offers through Essential Support," said Lionel Lamy, Research Manager, (Infrastructure Services and Outsourcing Practice) at IDC.
The problem is most apparent in companies with between 250 and 500 employees where only 20% of companies support their own operations with expert external support or backup. This contrasts with some of their smaller rivals where nearly 38% bolster their internal resources with external support.
Industries most guilty of not providing the support necessary to ensure effective long-term business continuity are retail, distribution and transportation where as little as 23% of companies have external support arrangements.
"There are nearly four million small to medium businesses in the UK, each of them almost totally reliant on technology for their survival to some extent or other," said David Frost, Director General at the British Chambers of Commerce. "Our advice to all of our members is to ensure they have an appropriate level of cover, either through internal resources or using an external company. That way, if something goes wrong, they can have the reassurance of knowing that they can be back up as quickly as possible minimising the damage to their business."
Essential Support is a relationship-based service direct from Microsoft Services that helps customers regularly monitor their technology environment, plan the deployment of technology and identify upcoming issues such as security. The net result is a reduced number of emergencies, improved availability and lower support costs. The support falls into four broad categories of assistance:
| • | Problem Resolution Support: When problems start to impact your business, customers need a fast, reliable route to technical support engineers with the depth of knowledge to effect a speedy resolution. Essential Support gives them direct access to a team of highly qualified Engineers twenty-four hours a day. |
| • | Support Assistance: Accessed by telephone, Microsoft engineers are deeply technical specialists who will answer customers’ more complex queries about undertaking specific tasks or plan for future changes. |
| • | Critical Situation Management Process: Essential Support customers also benefit from Microsoft's Critical Situation Management Process. For Business Critical incidents this will automatically trigger problem escalation, including our product development groups and early engagement of senior executives to resolve problems. |
| • | Training and Information Services: How do you and your staff keep up to date with the latest information from Microsoft? Fast, easy access to technical information is critical for planning and keeping operational systems running at peak performance. With Essential Support, the answer is simple. |
For further information about the research and Microsoft's Essential Support, visit the web site.
About the Microsoft research
Vanson Bourne interviewed 450 small and medium organisations (minimum 50 employees, maximum 1,000) within the UK across a variety of commercial sectors. Interviews were carried out via its online website and respondents were IT decision makers within the stipulated organisations. Interviews were conducted during October and November 2004.
About Microsoft
Founded in 1975, Microsoft (Nasdaq "MSFT") is the worldwide leader in software, services and solutions that help people and businesses realise their full potential.
About Vanson Bourne
Information is the key to the success of any business today, and never more so than in the IT industry. Vanson Bourne was established to provide information services to support IT companies enabling them to navigate the marketing cycle.
Incorporated in 1999, Vanson Bourne is a specialist IT market research consultancy, whose clients range from global corporations to small, highly specialised start-ups. Our goal is to provide research expertise and market insight using analysis and advice based on incisive and rigorous research into their market environment. These rely on the confidential contributions of qualified IT and Business professionals in organisations of all types, around the world.
Our experience encompasses researching both IT and Business professionals in all business sectors and geographies from Europe to Africa and from AsiaPac to the USA.
For further press information about this release, please contact:
Laura Abrar / Victoria Melville
AUGUST.ONE Communications
0208 434 5553 or 0208 434 5524
Laura.abrar@augustone.com / Victoria.Melville@microsoft.com
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*The average turnover for the 450 companies surveyed is £34,670,833 meaning that a half-day of revenue (£34m divided by 365 divided by 2) is £47,494.29. There are 3,992,000 small- to medium-sized firms in the UK (DTI figures, August 2004) and, extrapolating from the research, 66% of them have experienced downtime over the last two years. Of those 2,634,720 firms, 65% (1659873) have experienced downtime in the last quarter and 81% (1,344,498) of them take up to half a day to fix the problem. That means a total cost of up to £63,855,962,686.85.
