Australian firms face $24 million yearly hit from IT outages

New research from PagerDuty has highlighted a significant rise in digital incidents within Australian organisations over the past 12 months. According to the study, digital incidents have increased by 41%, with the average customer-facing incident now taking approximately two and a half hours (148 minutes) to resolve. This equates to a cost of nearly AUD $1,036,327 per incident or AUD $7,011 per minute.

The research underscores Australia's severe automation gap and provides insights into the escalating impact of customer-facing incidents. The data suggests that Australian organisations are facing substantial financial challenges due to these incidents, with respondents reporting an average of 23 high-priority/priority incidents each year, leading to cumulative costs of almost AUD $24 million annually.

This trend poses substantial issues for organisations attempting to manage the complexities of digital services. "Emerging technologies, growing consumer demands and legacy systems are costing Australian organisations, impacting their bottom lines and adding to wider market pressures," stated Natalie Fair, Regional Vice President for Asia Pacific, Japan at PagerDuty. "We're now at a point that automation has become critical in maintaining IT infrastructures, consumer trust, and ensuring sufficient investments are a priority for business leaders."

In addition to the substantial costs, the study reveals that a majority of Australian IT leaders believe board and management are failing to invest adequately in protecting customer trust during outages. Specifically, 71% of respondents criticised the lack of investment, while nearly a third (30%) reported that outages have negatively impacted share prices. Moreover, more than a third (38%) of IT leaders noted higher levels of employee burnout attributed to the impact of digital incidents and outages on business operations.

The report also highlighted significant gaps in automation within Australian organisations. More than 70% of IT leaders reported that critical processes such as remediation, mobilising responders, collaboration between teams, and internal communications with stakeholders are not fully automated. Despite these gaps, there is a positive trend towards automation; 85% of IT leaders surveyed mentioned that their organisations are making strides towards fully automating the end-to-end incident response process.

Jeffrey Hausman, Chief Product Development Officer at PagerDuty, noted the importance of automation in this context. "Digital incidents occur, and front-line responders are too often hindered in their ability to resolve incidents quickly due to fragmented IT environments, inadequate processes and inability to identify the right responders," said Hausman. He added, "Automation can be a key enabler in achieving resilience in these increasingly complex environments. With automation built into the PagerDuty Operations Cloud, businesses can streamline repeatable, critical work across incident response and service management to reduce the staggering financial costs of incidents."

The survey providing these insights was conducted online between May 31, 2024, and June 6, 2024, by Censuswide on behalf of PagerDuty. It involved responses from 500 IT leaders and decision-makers from companies with more than 1,000 employees across Australia, the United Kingdom, and the United States.