News and Insights – July 2018

The Real Cost of IT Downtime for Argentine SMBs

Downtime. It’s a word no business wants to hear. Yet for many small and medium-sized businesses (SMBs) in Argentina, unplanned IT outages remain an all-too-frequent—and costly—reality.

In July 2018, downtime is more than a minor inconvenience; it is a critical business risk. Whether caused by hardware failure, software crashes, cyberattacks, or internet disruptions, IT downtime directly impacts productivity, revenue, reputation, and even compliance.

According to industry benchmarks, the average cost of IT downtime is between USD $5,000 and $20,000 per hour for SMBs. While these numbers vary by sector, the bottom line remains the same: downtime drains resources, strains customer relationships, and diverts internal focus from strategic goals.

Common Causes of Downtime

• Outdated or unpatched systems
• Unstable internet or ISP failures
• Poorly managed backups or data recovery processes
• Lack of IT monitoring and alerting
• Malware or ransomware infections

Prevention Strategies

1. Implement proactive monitoring: Early detection prevents extended outages. System alerts let IT teams act before issues escalate.
2. Ensure backups are complete and tested: Regular backup audits and recovery simulations reduce restoration times.
3. Keep infrastructure updated: Apply security patches, upgrade aging servers, and retire unsupported software.
4. Leverage managed IT services: Outsourced IT partners provide dedicated support, monitoring, and rapid incident response.

Departmental Impact

• Sales: Lost opportunities from system unavailability and communication gaps
• Finance: Delays in invoicing, payroll, and transaction processing
• Operations: Halted workflows, order processing failures, production disruptions
• Customer Support: Inability to respond to clients or access CRM tools

Real example: A Buenos Aires–based firm suffered a 2-hour outage during their monthly billing run. As a result, they delayed invoices for over 200 customers, resulting in cascading cash flow issues and customer confusion. This was traced back to a failed Windows update that was never validated prior to rollout.

How to Calculate Downtime Costs

• Estimate the average revenue generated per hour
• Identify the number of users affected during an outage
• Factor in overtime, remediation efforts, and loss of goodwill
• Consider intangible losses like brand perception and employee morale

Example: Company A has 25 employees. Their average hourly revenue generation is $400. A 3-hour outage affecting 70% of operations costs them:

$400 x 3 x 0.7 = $840 in direct revenue loss, plus IT labor, potential fines, and reputational damage.

Next Steps

• Create an IT continuity plan
• Adopt cloud platforms with high availability SLAs
• Train staff on incident response
• Schedule infrastructure health checks quarterly

Here is your Downtime Cost Estimator