87% of Businesses in Malaysia Might Not be Able to Recover Lost Data and Systems

New independent research sponsored by EMC points to outdated backup and recovery infrastructure

Malaysia – June 21th, 2012. EMC Corporation (NYSE: EMC) today announced results of ‘The Disaster Recovery Survey 2012: Asia Pacific and Japan’, which found that 87% of companies in Malaysia are not very confident that they can fully recover systems or data in the event of a disaster, and that 69% of Malaysian organizations lost data or suffered systems downtime in the last 12 months. These findings highlight the need for backup transformation from antiquated technologies that are not suited for today’s data growth or availability expectations. A move to next-generation backup and recovery solutions ensure continued business operations in the event of a natural disaster, malicious activity or more routine and common disruptions to IT systems. In fact, the research has shown that the causes of systems downtime are often the commonplace disruptions to IT, such as hardware failure or data corruption, rather than natural disasters or other major incidents.

Commissioned by EMC and conducted by independent research company Vanson Bourne ‘The Disaster Recovery Survey 2012: Asia Pacific and Japan’ looks at the state of backup and disaster recovery in the region to understand how well companies are prepared for data loss and systems downtime.

Survey Findings:

Disruption happens: downtime and data loss more likely from an IT problem than a natural disaster

The research showed that it is not the extraordinary that creates problems, and it can take just a little to cause a lot of disruption, even something as simple as data corruption. The three most common causes of data loss and downtime in Malaysia are:
1. Hardware failure: 51%
2. Data corruption: 51%
3. Loss of power: 50%

This compares to just 13% of respondents citing natural disasters as a cause of systems downtime or data loss, and 16% of respondents attributing systems downtime or data loss to employee sabotage. Regardless of the cause, 61% of Malaysian organizations reviewed and changed their procedures for backup and recovery in response to an incident.

Furthermore, 51% of businesses increased their spending on backup and recovery after a disaster. This is against a backdrop where 36% of organizations surveyed did not feel they were spending enough on backup and recovery. On average, the research found that businesses across Malaysia are spending 9.54% of their IT budgets on backup and recovery.

Economic impacts: Lost revenue attributed to systems downtime
The study identified that there are measureable business impacts from systems downtime, with the top three cited by Malaysian organizations as:
1. Loss of employee productivity: 40%
2. Loss of revenue: 37%
3. Delay in product/service development: 39%

Systems failure resulted on average in two lost working days for the Malaysian businesses in the survey. Based on an average eight hour working day, this is the equivalent of 32,000 man-hours for a Malaysian company employing approximately 2,000 employees. Additionally, each organization lost an average of 1099GB of data during a 12 month period. Given that 1MB of data is approximately the equivalent of 25 email documents in size, losing 1099GB of data would be the equivalent of losing 27.48.1 million emails.

Despite loss of revenue being rated as a major consequence of systems downtime, the research also revealed that many Malaysian companies are not doing enough to protect essential customer data. 64% of organizations do not have a disaster recovery plan for their CRM systems, while only 5% of organizations who do have a disaster recovery plan for their applications would require their CRM applications to be up and running first following systems downtime.

Furthermore, businesses in Malaysia are failing to take advantage of insurance premium benefits that a comprehensive disaster recovery plan can engender. 62% of companies in Malaysia are obliged by either insurance policies or regulatory requirements to have a disaster recovery plan in place. More importantly, however, 40% of Malaysian organizations surveyed are offered reduced premiums by their insurance provider according to the strength of their IT systems backup/disaster recovery strategy. However, 36% of Malaysian organizations do not know if their insurance provider offers such reduced premiums – or they had never considered it at all – highlighting a missed opportunity for many businesses.

Outdated solutions: 43% still depend on tape and 35% still use CD Rom for backup and recovery, but this looks set to change
For backup and disaster recovery purposes, 43% of Malaysian organizations still rely on tape. Looking at the operational cost associated with tape, organizations in the Asia Pacific and Japan region spend on average more than USD58,821 (RM185,484) including transportation, storage, test and replacement of tape for the purposes of offsite disaster recovery. Meanwhile, 35% of companies rely on outdated CD-ROM for backup storage. Surprisingly, 14% of Malaysian organizations have an employee take a copy of their backup home with them for safekeeping.
However, 61% of businesses in Malaysia are already using modern disk-based backup and recovery solutions. This trend looks set to increase, with 80% of tape-using organizations looking to move beyond tape. The top three reasons cited for this planned move are:
1. Faster backups: 40%
2. Speed of data recovery and system restores: 38%
3. Durability (disk-based methods have a longer lifespan): 31% ; and Total cost of ownership: 31%
Preparedness for routine disruption or more significant incidents starts with a next-generation backup approach that leverages disk with data deduplication and network based replication technologies. The survey shows the reaction after disruption is to spend more on backup and recovery, but the damage is done in terms of time and money during a downtime as well as longer term damage to customer loyalty. By raising the visibility of the most common problems facing companies today and the associated economic consequences, organizations can proactively review their own strategies for backup and recovery to ensure they can meet business requirements.

Quotes
Aakash Gandhi, Chief Technology Officer, Infoplex
“This research raises a number of interesting issues around backup and recovery, not least that businesses need to take a proactive approach to ensuring their systems can cope well before an incident occurs. From our own experiences, it seems clear that a next-generation disk-based approach to backup and recovery is best placed to get business-critical applications up and running immediately, so that the economic impact such events have are minimized. By careful planning and ensuring we make the right investments, we are confident that we are well prepared for systems downtime, whatever the cause.”

Michael Alp, Vice President, APJ Backup and Recovery Systems Division, EMC
“It’s not uncommon that we find major organizations that cannot recover a lot of their backups, or rely solely on replication for Disaster Recovery. With increasing regulatory requirements in most countries, increasing and more aggressive security threats and continual growth of data fuelled by online channels, it is more important than ever that companies have a well defined DR strategy. Companies that do not have an effective strategy risk losing customer data and suffering significant fines from the regulators. There are new technologies that remove human error, eliminate the potential for losing data (such as backup tapes), provide encryption and automate the monitoring and reporting across the entire data protection environment. These solutions help our customers save money while reducing risk. This report looks at the risks and shows us that there is a lot of work to do.”

Shane Moore, Director APJ Backup and Recovery System, EMC
“Asia Pacific and Japan, is not immune to the uncertain economic times facing the rest of the world. Against this backdrop, it is more important than ever for businesses to ensure that they are protected against systems downtime and data loss or they are to withstand the damaging effects of loss of productivity and revenue. By establishing a well thought-out and strategic approach to backup and recovery that utilizes the next-generation solutions available today, businesses can withstand the consequences of day-to-day outages as well as more serious incidents, while reducing the total cost of ownership of their backup systems.”

Survey Methodology
For ‘The Disaster Recovery Survey 2012: Asia Pacific and Japan’ – commissioned by EMC, Vanson Bourne interviewed 2,500 IT decision-makers in private and public sector organizations in Australia, China, India, Japan, Korea, Indonesia, Malaysia, The Philippines, Singapore and Thailand. Each organization ranged between 250 and 3000-plus employees and represented a variety of industries including manufacturing, retail, financial services and telecoms, among others.