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CALCULATING DOWNTIME COSTS:How much should you spend on DR?
Paul Croteau – Enterprise Cloud StrategistRackspace Hosting
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Agenda
Downtime: The NumbersBuilding Your CaseManaging ExpectationsReference ArchitecturesRoles & ResponsibilitiesQ&A
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DowntimeThe Numbers
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Outages Happen
59% of Fortune 500 companies
experience a minimum of 1.6 hours of
downtime per week, according to Dunn
& Bradstreet.
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F500 2012 Hourly Loses
Total 2012 Revenue = $11.75T
Total 2012 Profit = $824B
• Ave. F500 Revenue = $23.5B
• Med. F500 Revenue = $10B
• Ave. F500 Profit = $1B
• Med. F500 Profit = $646M
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F500 2012 Hourly Loses
Total 2012 Revenue = $11.75T
Total 2012 Profit = $824B
• Ave. F500 Revenue = $23.5B
• Med. F500 Revenue = $10B
• Ave. F500 Profit = $1B
• Med. F500 Profit = $646M
($2.7M/hr)
($1.2M/hr)
($122k/hr)
($74k/hr)
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Minutes Matter• The average cost of data center downtime across industries:
approximately $5,600 per minute.
• For a partial data center outage, averaging 59 minutes in length, average costs were approximately $258,000.
• For total data center outages, which had an average recovery time of 134 minutes, average hourly costs were approximately $680,000.
• 93% of companies that lost their data for 10 days or more filed for bankruptcy within one year of the disaster, and 50% filed for bankruptcy immediately.
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Humans Make Mistakes
Through 2015, 80% of outages impacting mission-critical services will be caused by people and process issues, and more than 50% of those outages will be caused by change/configuration/release integration and hand-off issues. – Gartner Research
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Building Your CaseQuantifying Risk
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Do You Have A Plan?
41% of SMBs surveyed said that putting together a Disaster Recovery plan never occurred to them.
Less than half of SMBs back up their data weekly or more frequently, and only 23% backup daily.
Backups are not enough! The goal of a backup is to enable data restoration. A DR plan helps quickly restore operations.
DR is a holistic strategy for restoring IT systems that powers business ops that includes people, process, policies and technology.
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From minutes to weeksDowntime Perspective
How Resilient Is Your DR plan?– Device failure– Cabinet failure– Facility failure
Time To Recovery
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Cost of Downtime Scenarios
Annual Revenue App/ProductivityAnnual Revenue $15,000,000 Annual Revenue $75,000,000
Percentage of Revenue from Online 90% Number of employees 400Average shopping hours per day 12 Annual revenue per employee $187,500
Annual total revenue hours 4380 Work hours per year (2000 hours/employee) 500,000Cost of downtime per hour $3,082 Employee revenue per hour $150
Hours of downtime 10Sales Lost Percentage employees affected by downtime 20%
Duration of Event (days) 4 Cost of downtime per hour $375,000 Hours of event 96
Expected visits generated 500,000 Event RevenueConversion rate (visits to purchase) 6% Expected Event Revenue $100,000
Average revenue per purchase $500 Event Duration (days) 3Revenue per event $15,000,000 Event hours 72
Cost of downtime per hour $156,250 Cost of downtime per hour $1,389
If you don’t know your actualcost of downtime,
you are wasting time.
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Annual Revenue BasisCost of Downtime Scenarios
Annual Revenue
Annual Revenue $15,000,000
Percentage of Revenue from Online 90%
Average shopping hours per day 12
Annual total revenue hours 4380
Cost of downtime per hour $3,082
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Cost of Downtime Scenarios
Event Revenue
Expected Event Revenue $1,000,000
Event Duration (days) 3
Event hours 72
Cost of downtime per hour $13,089
Single Event Revenue
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Cost of Downtime Scenarios
Sales LostDuration of Event (days) 4
Hours of event 96Expected visits generated 500,000
Conversion rate (visits to purchase) 6%Average revenue per purchase $500
Revenue per event $15,000,000Cost of downtime per hour $156,250
Sales Lost
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Cost of Downtime Scenarios
App/ProductivityAnnual Revenue $75,000,000
Number of employees 400Work hours per year (2000 hours/employee) 500,000
Employee revenue per hour $150 Annual revenue per employee $187,500
Hours of downtime 10Percentage employees affected by downtime 20%
Cost of downtime per hour $120,000
Productivity Basis
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Get The Downtime Calculator
rackspace.com/dt-cost
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ExpectationsImplication of Time
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RPO / RTO
WeeklyBackup
WeeklyBackup
WeeklyBackup
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RPO / RTO
WeeklyBackup
WeeklyBackup
WeeklyBackupOUTAGE
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RPO / RTO
RPO
WeeklyBackup
WeeklyBackup
WeeklyBackupOUTAGE
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RPO / RTO
RPO
WeeklyBackup
WeeklyBackup
WeeklyBackup
RTO
OUTAGE
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RPO / RTO
RPO
WeeklyBackup
WeeklyBackup
WeeklyBackup
RTO
RecoveryCompleted
OUTAGE
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RPO / RTO
Recovery Point ObjectiveHow much data is lost
Recovery Time ObjectiveHow long to recover
Weeks Days Hours Min Sec Sec Min Hours Days Weeks
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RPO / RTO
Recovery Point ObjectiveHow much data is lost
Recovery Time ObjectiveHow long to recover
Weeks Days Hours Min Sec Sec Min Hours Days Weeks
Tape
PeriodicReplication
Snapshots
Replication Clustering
Snapshots
Tape Restore
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RPO / RTO
Recovery Point ObjectiveHow much data is lost
Recovery Time ObjectiveHow long to recover
Weeks Days Hours Min Sec Sec Min Hours Days Weeks
Tape
PeriodicReplication
Snapshots
Replication Clustering
Snapshots
Tape Restore
CostImpact
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RTO/RPO Cost ExpectationsHOT COLDWARM
RTO
RPO
Tier
• DNS Failover
• Array-based Replication
• Host-based Replication
• DB Replication (Transactional)
• DB Rep. (Log Shipping)
$$$ $$ $
0-24
2-6
0-24
4-24+
24-48+
1 2 3 4
0-2
• MBU (Disk)
• VM Replication
Price
• MBU (Tape)
• MBU (Offsite)
Elements of DR, not an end-to-end solution
Missing process, policies and procedures• GSLB
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ArchitecturesDefined By Your Priorities
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Designing for Redundancy
HA FirewallsHA Load Balancers
Private Cloud
DB Cluster
SharedStorageDedicated
Storage
Hypervisor
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Designing for Geo-Redundancy
LUN
VM
vSphere-basedArray-based
Prod DR
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I need backup!DR Site Requirements
How long must you depend on your DR site?
How do you define your DR site requirements?
DR = Insurance.
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DR-specific Site
Prod DR
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DR-specific Cold Site
Prod DR
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DR-specific Cold Site
Prod DR
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Staging as Warm DR
Prod DR
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Staging as Warm DR
Prod DR
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Staging as Warm DR
Prod DR
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Staging as DR(expanded)
Prod DR
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Roles/ResponsibilitiesShared
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Leverage Expertise
Common questions from customers:
Who owns the overall DR strategy?
Who will design it?
Who is going to manage and monitor it?
Who will perform the failover?
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Designing Your DR Strategy
Businesses own the strategy.
Vendors enable the strategy.
The strategy is unique to your needs.
Testing matters.
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Prioritizing Content/Apps
How do you prioritize?
What are you protecting?– Business Operations– Revenue– Data– Customers– All of the above
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Roles & Responsibilities
Role Responsibility
DR Plan Failover Plan / Run Book Business
“Pushing the failover button” Business
Failover Process Partner
Replication Applications Partner
Virtual Machine Partner
Database Partner
Guest OS Partner
Hypervisor Partner
Server Partner
Storage Partner
Network Partner
Data Center Partner
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Testing
Companies don’t test their failover plan enough.
Some replication services charge per test: expensive
The failover/back process can be risky in production
Risk dictates extensive planning around every test
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So, How Much Should You Spend On DR?
How much revenue will you lose?
How much else will you lose?
How much can you afford?
Based business decisions on fact, not emotion.
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Summary
DR is Your Responsibility
Know Your Cost of Downtime
Prioritize Your Apps
Select The Right Tools
Select The Right Partner
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Rackspace HostingA Diverse Portfolio
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The Rackspace Portfolio
PRIVATECLOUD
PUBLICCLOUD
CUSTOMER
PREMISE
PARTNERDATA
CENTER
PRIVATECLOUD
PRIVATECLOUD
VIRTUALIZED
VMware
DEDICATED
BARE METAL
RACKSPACE DATA CENTER
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Q&A