What Internet Downtime Is Costing Your SME

In 2013, a lapse in cable maintenance sparked a fire in Bukit Panjang exchange. Telecommunication operations nationwide came to a halt, and close to 270,000 subscribers experienced service disruption, which was only fully restored 8 days later. In the meantime, banking services like ATM cash withdrawals were affected, AXS kiosks could not process payments and several polyclinics were unable to access their patient records.

Although the occasional period of internet downtime might not seem like as much of a pressing issue to smaller businesses, here are a few ways it could cause your business considerable damage.

Loss of productivity

If your data is stored in a cloud solution, or if your mission-critical applications rely on internet connection, your business loses majority of its operation capacity until online access is restored. A drop in internet connectivity culminates in interrupted operations. The resulting loss in productivity could take form in a serious decline in consumers. See how businesses which use cloud-based POS systems are affected by downtime:

Important data can also be lost during the outages, no matter how short they might be. For example, files being transferred or uploaded online are compromised by poor connectivity, and recovering the lost data eats into your time and resources.

Employee productivity also sees a serious drop as they are unable to access your core business sytems to carry out their day-to-day work.

Decrease in service production

With fewer channels for communication between you and your customers, you are most likely unable to deliver your product or service on time. Businesses cannot offer prompt responses to customer queries or delivery orders, decreasing faith in the brand. If you’re in a consumer-facing or commerce business, a heavy dent in brand reliability is especially detrimental to your business’s success.

Furthermore, as most communications are conducted via online mediums like email, a disruption in the connection means your business is ultimately at a standstill until the problem is fixed.

Revenue loss

As any business owner would know, a dip in productivity and service production can result in tangible repercussions in the loss of revenue:

“The average SME loses anywhere between $20,000 and $100,000 from just one hour of internet downtime¹.”

The massive damage comes from paying unproductive employees, the cost to restore IT infrastructure and a lack of communication channels critical for day-to-day operations.

Other possible downsides, depending on your type of business, includes compliance violations and loss in stock value. For a closer estimate of how much your business stands to lose from downtime, try this downtime calculator.

The Solution

According to IDA investigations, the Bukit Panjang exchange disruption was caused by the assumption that the fibre cable paths were diversified when in actual fact, several connections were made through the same entry point. This proved to be incredibly risky: damage to the sole point of connection brought about failure in the multiple cable paths that relied on it.

While internet outage of this large a scale is unlikely for SMEs, the crux of the downtime problem remains the same—a lack of link diversity. This is easily prevented with a 4G failover network in place, cutting internet downtime to virtually zero by automatically rerouting to a 4G network connection when your primary network fails.