The cost of an outage and IBM APM

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In February of last year, Sony’s PlayStation Network (PSN) went down, affecting almost 56 million gamers and users. This was not the first instance. The PSN has experienced problems and outages in the past. However what embittered users most was the generic response from the company, which stated that engineers were investigating the issue. People from all across the world took to social networking sites to criticize the company and Sony lost some of its most loyal customers. This type of incident is of course not restricted to Sony. According to Forbes, Amazon loses $66,240 per minute if their site goes down. With a downtime of 40 minutes last year, more than $2.5 million dollars of revenue was lost.

These are just a few examples of what an application outage or downtime can cost your organization.

How is cost of an outage calculated?

Various internal and external factors can contribute to application outages. The costs can be both tangible and intangible. The upfront tangible costs can include loss of business revenue due to downtime, idled labor and loss of productivity. And then there are the intangible costs like loss of customer loyalty, loss of customer trust, effected reputations and competitive disadvantages. Given the digital age we live in, bad news travels faster due to social networking sites, and competitors can use an outage as an opportunity to hurt business owners further.

Additionally, businesses need to spend marketing dollars to restore their lost reputations. These are generic costs associated with every outage. You can estimate the true cost of an outage for your business by identifying critical components, determining any vulnerabilities, estimating the associated length of an outage or slowdown and estimating the cost of post-outage resolution and maintenance activity costs.

How can an outage be avoided?

Calculating the cost of an outage will illustrate why it makes sense for organizations to not only diagnose the root cause of an outage quickly, but more importantly, prevent the outage from happening in the first place. Fortunately, there are tools available today to prevent outages and slowdowns.

Consider IBM application performance management (APM). This product can monitor your application infrastructure along with individual application components down to the code level. It can also monitor the end-user experience and predict outages before they happen. If these same tasks were done manually, it would require experts several months to manually instrument the code in each of the application components, adding on the extra burden of maintaining and optimizing the code itself. APM can relieve the burden of involving experts by calculating behavioral patterns using cutting-edge machine learning on historical data, ensuring that health levels are maintained. These products come with various deployment options, including traditional on premises deployment, cloud or hybrid. The monitoring capabilities can be customized depending on the needs of the business and its application infrastructure.

In today’s competitive world, consumers expect uninterrupted access to their favorite services. It is imperative for businesses to analyze what it takes to increase application uptime and minimize the total cost of outages by investing in a toolkit that can help them optimize overall application performance. APM is the most important part of today’s IT toolkit and can make or break your business bottom line. Try IBM Application Performance Management to get insights on your application performance and prevent outages.

Want to learn more? Check out our APM for App-Driven Businesses whitepaper.

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