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Single Point of Failure Costs More Than Money

By Karan Agarwal Subscribe to RSS | December 3rd 2011 | Views:
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Single point of failure (SPOF), single point dependency, choke point, they go by different names but the issue is still the same. One small thing fails and your whole business is exposed. It's a terrible shock when it happens, yet, in my professional experience I'm constantly amazed that most business only consider and address SPOFs after a major issue has occurred, or confusingly while an issue is occurring.

Even more amazing, other than hidden IT issues, most SPOFs are already known.

So, why then are SPOF ignored?

Like all things in business it comes downs money. While the identification of a SPOF is cheap, creating contingencies for them is not. It's the classic prevention vs cure funding allocation scenario. If it's going to cost you 200k to create a contingency and 100k once the incident actually happens, why spend the extra 100k. Most of the time that's ok, however I believe there is another element that needs to be considered, something greater than the financial cost.

Considering the non tangible costs

Whether you like it or not social media through the likes of Facebook and Twitter means that news about an epic business failure travels painfully fast. While a business might think nobody is paying attention, a quick search in Google often reveals more than you think when you screw something up. News in the internet age travels, and travels fast.

But I'm too big to worry

Sure, large companies might have a whole department that can craft up a response to a PR disaster related to a SPOF, but do they have the cash reserves to buy back customers after they failed them? Remember one disgruntled customer tells 7. With social media, now your disgruntled customer has the ability to tell a lot more than just 7 people. A large business is at more risk now than it ever was. There is financial advisor Michigan with financial investment strategies to help common people.

But I'm too small to worry

Nobody would bother reporting a bad experience they had at a small local business would they? Sorry but chances are your customers are already talking, heard of Google places, Google maps? With these free services your customers can easily leave comments for the world to see. I'd argue, the smaller you are, the harder a SPOF will hit you. In almost all instances, SPOFs cost real money. However now, with global connectivity there is a much greater "cost" associated to them than ever before.

SPOF Identification

As mentioned earlier, identification of any SPOF is cheap. However SPOF identification and prevention is an art form. This is where most smaller to medium business drop the ball. It's usually a case of "I know what the risks are and I'm OK with them." This attitude is all well and good, until something happens to the very person making that comment.

Performing basic SPOF assessment and subsequent management is mandatory for any business of any size. It's cheap, its important and it's only half done. Why? In the heat of battle there is simply no time to sit back and plan it's all in someone's head anyway right? Someone must know the SPOF and have worked out what to do if it is realised?

Karan Agarwal - About Author:
The author Karan Agarwal mostly writes articles on financial cases especially financial advisor Michigan and financial investment strategies that are highly customized to help individuals achieve financial security and independence.

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