The Votes Are In – Sandy Takes All

Spend Matters welcomes another guest post from NPI, a spend management consultancy, focused on delivering savings in the areas of IT, telecom and transportation.

The election may be the talk of the day, but the CIOs I've spoken with have one thing on their minds: disaster recovery. With the aftermath of Hurricane Sandy weighing heavily on businesses across the country, many companies are shaking the dust off of their business continuity and disaster recovery plans and asking themselves a tough question: "Are we really prepared?"

This is a good thing, of course. BC/DR plans should be living, breathing documents that are updated and evaluated frequently. If anything, Sandy has taught us that many businesses are still under-prepared for large-scale natural disasters.

For that reason, NPI anticipates many companies will take a fresh look at their BC/DR plans in the coming months, likely resulting in an uptick in BC/DR spending. As this happens, companies should do two things to make sure they get the most out of their BC/DR investments:

Eliminate retainer-based, oversubscription DR contracts. Many companies have "checkbox DR," which means they've partnered with a vendor who will provide drop-ship BC/DR resources within 72 hours of a disaster. In addition, this "check-box" vendor will need to confirm that the circumstances constitute a disaster which presents both another timeline obstacle as well as possible point of dispute.

Furthermore, these vendors oversubscribe their BC/DR equipment. For example, a vendor may have only 100 servers available to 20-plus clients. They hedge their bets on the fact that no more than a few clients will ever need those servers at the same time. Just in case, they prioritize who will have access first. Between the insufficient timeframe for receiving resources and the chance you won't have readily available access to the very resources you've paid for, these vendor agreements are rife with overspending for too little, too late.

Establish volume discounts in your high availability contracts. Going to a high availability (HA) environment is no longer twice the cost of a single site. Advances in technology have made HA setups very attainable, but there are still dedicated components that will require a long-term investment (e.g. real-time data replication and extra network/SAN capacity). It's important that you understand vendor pricing and the cost impact should your volume of data drastically increase. Make sure your contract includes a rate structure that provides volume discounts and rate tier changes should your data volume increase.

- Jon Winsett, CEO, NPI

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