24 March 2011: The string of natural disasters that have struck both globally and locally in 2011 have highlighted the importance for businesses to ensure they have sufficient data storage systems and reliable back-ups in place to avoid the potential loss or damage to critical company data and information.

According to a report by the National Archives & Records administration in Washington, 93% of companies that have lost their data centre for 10 days or more due to a disaster filed for bankruptcy within one year of the disaster.

Anthony Eedes, General Manager of Metrofile, the JSE-listed information and records storage management business, says that failure to securely store and back-up data means a company has to rebuild its database from scratch in the event of it being destroyed. "Reconstituting company information and data could take months, or even years, which can have a potentially devastating impact on a business by delaying, hindering or even permanently ceasing productivity."

Eedes singles out the local financial, telecommunications and medical industries as examples of sectors where immediate access to critical information is paramount. "These industries simply cannot afford to lose data. For example, in the medical industry someone's life may depend on the availability of vital medical details, which could result in legal ramifications if the information is lost or not delivered on time."

He says that should a company have no data storage and recovery plan in place the potential business repercussions include, among others, financial losses, damage to brand reputation, costly litigation, job losses and total business inoperability. "Data is unquantifiable and therefore extremely difficult to insure, making it impossible to recover any financial losses.

"Potential legal risks include law suits for loss of information and original contract losses. The new Companies Act in particular stipulates company directors are held liable if information is not securely stored and could face possible imprisonment."

Eedes advises that in order to avoid the loss of critical company information, businesses should review their existing data storage procedures, identify key information and develop a Business Continuity Plan (BCP) which entails storing data and information with a specialised records and data management company.

"Records management entails the storage of company data and information in purpose-built facilities and data protection involves the securing of a backup data tape in an off-site vault. The location of storage facilities are specifically situated in low-risk areas where exposure to flooding, fires, earthquakes, flight paths or other natural disasters are least probable."

Eedes says that a combination of both physical and online data backup provides the most comprehensive backup storage system. "The online disaster recovery site continuously mirrors the information stored to the records management storage system to avoid loss of data due to data corruption.

"Closure as a result of loss or damage to company data and information is becoming increasingly prevalent yet this risk is so easily mitigated," concludes Eedes.