How much money is poor network performance really costing your business?

As businesses and organizations become more and more connected, network performance increasingly becomes a valuable resource that needs to be safeguarded. Migrating key systems and applications to the cloud is generally recommended for the wide range of benefits it brings, but if you rely on a cloud-based infrastructure, poor network performance can seriously jeopardize your operations.

Every organization should ensure they have the right tools, and resources available to maintain peak network performance.  This is essential to maintain a proper level of performance and assuring quality of service, while also staying in your budget.  Network issues can cause loads of headaches for any organization, and repair costs can be hefty.  Often it is quite challenging for organizations to balance cost versus quality. In fact,many times teams don’t even have the skills they need in-house, and external help if needed is not cheap. Yet, companies must pay for these skills or risk bigger issues such as missed SLA’s or poor customer satisfaction. 

The consequences of poor network performance

Computer networks are meant to make your organization’s operations more efficient and your employees’ jobs easier and more convenient. However, problems with your network may have the opposite effect. When teams find it harder to do their jobs, their morale often worsens. This often results in more mistakes, and slower response times.

Lost productivity is particularly damaging when it comes to customer-facing applications. Customers expect your websites and applications to function as intended.  This is especially true for e-commerce sites, where customers expect to find their desired products and pay for them instantly. If a network slowdown affects their user experience, they may become very frustrated. It’s been estimated that nearly half of all consumers expect a web page to load in two seconds or less—and if it takes more than three seconds, 40 percent will just abandon it.   This can result in lost business opportunities or sales.

Employee productivity and customer satisfaction aside, poor network performance can also adversely affect data processing, analysis, and storage on the cloud. Not only can accessing data be hindered, but vital information can even be lost due to a problem on the network.

The true cost

Poor network performance has a real dollar cost. Loss of productivity due to poor network connectivity has been estimated to amount to 71 hours per employee per year—which, with a 40-hour work week, amounts to every employee taking an extra two weeks off each year. In another recent survey by network quality monitoring provider Netrounds, this drop in productivity accounts for about $165,000 in losses every year.

In that same survey, up to 83 percent of companies report being affected in serious ways by unanticipated drops in network quality. Yet, 61 percent of such incidents were not even discovered by the companies’ IT teams. All this adds up to an estimated average loss of $600,000 a year. Can your business afford to pay that price?

Causes of poor network performance

There can be any number of reasons why your network is performing poorly. Sometimes the problem may be simple, such as poor cable connectivity, or some other physical problem with your cables. These types of problems can be solved easily by replacing the wires—and a network monitoring solution can help to identify the network interface that is causing errors.

More complex issues include high CPU usage on your computer network, usually caused by heavy traffic slowing down traffic. Excessive bandwidth use can also cause congestion on your network, especially if employees are downloading videos and other large files. This can result in other important systems and applications not getting the bandwidth they need.  Adding to the problem, these types of performance issues are often difficult to debug.

How to mitigate poor network performance

Fortunately, there are ways to avoid these losses and ensure your network traffic is benefiting from optimal performance. Fiber internet uses fiber optic cables, which transmit information at literally the speed of light. Not only are they faster, they also aren’t susceptible to electrical interference like normal copper cables.

When you’re selecting a cloud or co-location provider, you’ll also want to choose one that’s located near your office. Latency is the effect of data slowdown when it travels from one location to another, and you can reduce it if your data is stored somewhere physically closer to you. In fact, one study suggests your cloud-based applications can run up to 20 percent faster this way.

Another step you can take is to check your service-level agreement (SLA) with your network provider. This agreement should lay out the performance metrics that they’re required to meet, which include upload and download speeds. When choosing a potential provider, read through their SLA before deciding to commit.

Finally, active network testing and monitoring can produce up to 10 times fewer drops in network quality. With active service assurance and monitoring services, not only can businesses identify the cause of a network slowdown more quickly, but they can also prevent 66 percent of all causes of poor network speeds. This is clearly the best option to take in order to prevent the consequences of poor network performance, and worth every penny it costs.

An effective network and application monitoring solution such as Accedian Skylight can help reduce poor network performance, and assure a high quality of experience.  For a free demo, click here.