Availability Guide for Application Design

What Is Application Availability?
Availability Guide for Application Design—525637-004
1-4
Cost Containment
Revenue Loss
Revenue loss is perhaps the most obvious cost of an outage. Application failure means
that the stock brokerage can handle fewer transactions that day, the mail order
company cannot process orders, and the manufacturing plant might have to shut down
its production altogether. Any organization that depends on its computer system for its
revenue-generating functions will suffer a loss of revenue in the event of an outage.
Penalties
Service providers are typically under contractual obligation to provide an agreed level
of service. For example, the contract might state that the service must be available with
no more than 5000 minutes of outage time a year and that the provider is obligated to
pay penalties if that clause of the contract is not fulfilled. Such penalties can be
devastating if the outage time is significantly larger than the contractually agreed
maximum.
Productivity Loss
Temporary loss of an application causes a significant loss in productivity. The number
of workers standing idle, waiting for the application to come back online, can run into
the thousands. Typical human reaction to an application going down can make matters
even worse; the system goes down, so many employees take a 15-minute break, then
come back to find the application was down no more than a couple of minutes. Or
worse, the employees come back after 15 minutes, see that the application is still
unavailable, so decide to go home for the day!
Support and Operations Costs
Bringing the application back online places a heavy burden on operations and support
personnel, who might need to work extra hours to catch up on scheduled work,
investigate the outage, and propose and implement long-term solutions. All of these
tasks involve highly paid professionals and often incur additional overtime payments.
Reputation Costs
When a user is unable to make use of a given service, that user becomes reluctant to
trust the service again. Frustrated customers often take their trade elsewhere, leaving
the service provider with the task of finding additional new customers. One rule of
thumb says it costs five times as much to get a new customer as it does to keep an
existing one.
The problem is magnified for high-visibility outages where competitors can take
advantage of adverse publicity. Rebuilding the corporate image of a company that you
can trust to deliver services can be expensive and can take years to accomplish.