Downtime can represent a significant loss in operating efficiency if not managed properly. While many resources are expended on analyzing and optimizing efficiencies on the shop floor, some basic areas of critical importance outside of the manufacturing heart of a business are often neglected.
So there you are, looking over your lean and mean enterprise. Your manufacturing ERP software, EnterpriseIQ, is scheduling production requirements, monitoring the shop floor, automagically processing EDI, managing scanners and effectively keeping your enterprise connected as part of the global supply chain. It is a thing of beauty. This is the glamorous side of business that can be quantified, graphed, calculated and bottom-lined. It’s where all the eyes are focused.
But when was the last time someone looked inside the closet that contains the hardware running the hardware running the enterprise? Yes, I am talking about the servers, switches, storage devices and anything else needed to keep your revenue-generating hardware working at its peak effectiveness. It is unfortunate, but all too often the SysAdmin department at IQMS receives questions regarding areas to shortcut or squeeze hardware requirements in order to shave off a few dollars. Questions like:
- “Do I really need to allocate that much memory to the server?”
- “RAID, why do we need a RAID system? It is too expensive.”
- “Why do I need a training server?”
- “Do I really need to segregate the Oracle database on a dedicated server? I have my old Pentium IV server that is running my current production system, which also happens to be my Exchange server, PDC and my web server. Can’t I just install Oracle and EnterpriseIQ on that machine?” (My personal favorite)
To be fair, these questions do not typically come from IT professionals unless they are new to the job. We usually see these kinds of questions coming from someone trying to figure out a budget and approaching the process with a fairly short-term view in mind. The issue with this kind of restrictive approach is that areas that do not obviously contribute to the generation of revenue within a company do not get enough consideration.
Really, a wire is a wire, what is there to consider here? Well, when that wire does not function properly, there is quite a bit to consider, especially when it starts to affect enterprise performance metrics (revenue).
Let’s look at a hypothetical scenario revolving around a promising company named Acme Rubber Mallet Inc. Acme has a fairly sweet deal selling rubber mallets to a captive audience consisting of animated rabbits and ducks (Humor me; I grew up with this stuff). They have done very well for themselves and are ready to expand their operations through the use of the above mentioned EnterpriseIQ suite of tools. Currently, the company is reporting annual revenue of around $12 million per year, but expects to double its output in the next year.
Acme’s Accountant/IT person, Elmer, is working out the details of the necessary hardware and trying to fit everything into the allotted budget. Looking over the numbers, he realizes that he is a bit over budget and needs to implement some creative cost savings. He decides to skimp on the battery backup systems for the server and rather than getting enterprise class UPS units, he runs down to the local computer shop and picks up some consumer UPS units (saving about $500).
Now fast forward three months. Acme Rubber Mallet Inc. is up and running and doing very well with their new system. That is until the seasonal Midwest storms set in and wreak havoc on the area. There were some very powerful lightning strikes and heavy winds that cause power spikes that take the power grid down for about 25 minutes. Once power was restored, it is discovered that the server would not restart properly. While the hardware is intact, corruption to the data on the storage units occurred because the battery backup units were not able to handle the load on the servers and power them down gracefully.
In the end, it required six hours of work to rebuild the servers and restore data from backups. While the company was not completely down, overall it was functioning at 50 percent efficiency because of the extended outage. How much did the outage cost Acme in lost revenue? I can guarantee that it was much more than the $500 of savings by purchasing inadequate battery resources. From a very simplistic view, $12 million revenue per year averages to $32,876 per day. The company was running at 50 percent for six hours. That translates to about $4,110 in potential lost revenue over the period of the outage. Not the bargain that Elmer was looking for.
I realize this is a very simplistic and contrived scenario. The point behind this little exercise is to help bring some perspective and focus to the bigger picture regarding overlooked risks that affect overall organizational efficiency. Clearly understanding how each component within the enterprise ties together and prioritizing and addressing potential weaknesses is critical for effective downtime management.