As organizations look to transform their business operations and revolutionize customer service, Digital Transformation (DX) is at the top of most CXOs’ agendas; in fact, DX spending is expected to approach $7.4 trillion between 2020 and 2023, a CAGR of 17.5%. However, according to the latest industry data released today from Veeam Software, the leader in Backup solutions that deliver Cloud Data Management™, almost half of global organizations are being hindered in their DX journeys due to unreliable, legacy technologies with 44% citing lack of IT skills or expertise as another barrier to success. Moreover, almost every company admitted to experiencing downtime, with 1 out of every 10 servers having unexpected outages each year — problems that last for hours and cost hundreds of thousands of dollars – and this points to an urgent need to modernize data protection and focus on business continuity to enable DX.
The Veeam 2020 Data Protection Trends Report surveyed more than 1,500 global enterprises to understand their approach toward data protection and management today, and how they expect to be prepared for the IT challenges they face, including reacting to demand changes and interruptions in service, as well as more aspirational goals of IT modernization and DX.
According to the report, the top challenge faced by all organizations today is ransomeware and cyberthreats. Average ransomware attack costs over $80k to restore data, if possible. Another challenge faced by companies is skills shortage due to legacy systems. Organizations skills are locked up in managing legacy platforms, providing significant barriers for innovation.
“Technology is constantly moving forward, continually changing, and transforming how we do business – especially in these current times as we’re all working in new ways. Due to DX, it’s important to always look at the ever-changing IT landscape to see where businesses stand on their solutions, challenges and goals,” said Danny Allan, CTO and SVP of Product Strategy at Veeam. “It’s great to see the global drive to embrace technology to deliver a richer user experience, however the Achilles Heel still seems to be how to protect and manage data across the hybrid cloud. Data protection must move beyond outdated legacy solutions to a higher state of intelligence and be able to anticipate needs and meet evolving demands. Based on our data, unless business leaders recognize that – and act on it – real transformation just won’t happen.”
The Criticality of Data Protection and Availability
Respondents stated that data delivered through IT has become the heart and soul of most organizations, so it should not be a surprise how important “data protection” has become within IT teams, including not just backing up and restoring data, but also extending business capabilities. However, many organizations (40%) still rely on legacy systems to protect their data without fully appreciating the negative impact this can have on their business. The vast majority (95%) of organizations suffer unexpected outages and on average, an outage lasts 117 minutes (almost two hours).
Putting this into context, organizations consider 51% of their data as ‘High Priority’ versus ‘Normal’. An hour of downtime from a High Priority application is estimated to cost $67,651, while this number is $61,642 for a Normal application. With such a balance between High Priority and Normal in percentages and impact costs, it’s clear that “all data matters” and that downtime is intolerable anywhere within today’s environments.
“Data protection is more important than ever now to help organizations continue to meet their operational IT demands while also aspiring towards DX and IT modernization. Data is now spread across data centers and clouds through file shares, shared storage, and even SaaS-based platforms. Legacy tools designed to back up on-premises file shares and applications cannot succeed in the hybrid/multi-cloud world and are costing companies time and resources while also putting their data at risk,” added Allan.
DX and the Cloud
Enterprises know they must continue to make progress with their IT modernization and DX initiatives in order to meet new industry challenges, and according to this report’s feedback, the most defining aspects of a modern data protection strategy all hinge upon utilization of various cloud-based capabilities: Organizations’ ability to do disaster recovery (DR) via a cloud service (54%), the ability to move workloads from on-premises to cloud follows (50%), and the ability to move workloads from one cloud to another (48%). Half of businesses recognize that cloud has a pivotal part to play in today’s data protection strategy; and it will most likely become even more important in the future. For a truly modernized data protection plan, a company needs a comprehensive solution that supports cloud, virtual and physical data management for any application and any data across any cloud.
Allan concluded: “By already starting to modernize their infrastructures in 2020, organizations expect to continue their DX journey and increase their cloud use. Legacy solutions were intended to protect data in physical datacenters in the past, but they’re so outdated and complex that they cost more money, time, resources and trouble than realized. Modern protection, such as Veeam’s Cloud Data Management solutions, go far beyond backup. Cloud Data Management provides a simple, flexible and reliable solution that saves costs and resources so they can be repurposed for future development. Data protection can no longer be tied to on-premises, physically-dedicated environments and companies must have flexible licensing options to easily move to a hybrid/multi cloud environment.”
Other highlights of the Veeam 2020 Data Protection Trends Report include:
- Over half (54%) of Middle East and African organizations have an “availability gap” between how fast they can recover applications versus how fast they need to recover them. This is significantly lower than the global average of 73%.
- Over half (51%) of Middle East and African organizations have a “protection gap” between how frequently data is backed-up versus how much data they can afford to lose after an outage. This is significantly lower than the global average of 69%.
- The No. 1 challenge that will impact global organizations within the next 12 months is cyber threats (32%). The most impactful data protection challenge global organizations currently have is the lack of staff to work on new initiatives (42%), whereas in the Middle East and Africa, it is the lack of ability to support DevOps or AppDev (27%).
- Over half (51%) of global respondents believe DX can help their organization transform customer service. Almost half said it could transform business operations (48%) and deliver cost savings (47%).
- Almost one-quarter (23%) of global organizations describe their progress towards achieving DX initiatives and goals as mature or fully implemented.
- Almost a third (30%) of global organizations are currently in the early stages of implementing or planning DX.
- 43% of regional respondents in Middle East and Africa said lack of IT staff skills or expertise is preventing or has prevented their organization to move forward with DX. Other barriers include dependency on legacy systems (40%); lack of buy-in from senior management (23%); limited budgets (29%); and lack of time (16%).
- Over a third (39%) of global respondents said the ability to improve reliability of backups is the most likely reason to drive their organization to change its primary backup solution. 38% cited reduced software or hardware costs and 33% said improving return on investment.
- Almost a quarter (23%) of global organizations’ data is replicated and made business continuity (BC)/DR capable via a cloud provider. Over a fifth (21%) of data across organizations globally is not replicated or staged for BC/DR.
- Over a quarter (27%) of global organizations’ data is backed up to the cloud by a Backup as a Service (BaaS) provider, compared to 28% of Middle East and African organizations. Nearly a fifth (19%) of Middle East and African organizations is not backed up, which is higher than the global average of 14%.
- Over two in five (43%) global organizations plan to leverage cloud-based backup managed by a BaaS provider within the next two years, this is the same as Middle East and African organizations.
Claude Schuck, regional manager, Middle East at Veeam said, “According to the Veeam 2020 Data Protection Trends Report, Middle East and African organizations would be well advised to focus on staff training and development as well as on IT modernization to accelerate Digital Transformation. With data being the most valuable business asset today, its protection and security is paramount and should be the base and stepping stone of each company´s digitalization strategy. Although organizations in the Middle East spend a lot of budget on security technologies in general, there is still a considerable discrepancy when it comes to planning and implementing a data protection policy,” and he concludes “Regional IT decision-makers need to have a consistent action plan in place which includes important measures like stress testing of IT systems, regular backups, a disaster recovery plan and educating employees.”