The impact of data protection challenges on digital transformation

Nigeria now hosts over 90% of State data locally

Veeam, has released its Data Protection Report 2021 which highlighted that data protection challenges, COVID-19 and economic uncertainty are undermining organizations’ abilities to execute Digital Transformation (DX) initiatives globally.

According to the report, up to 58% of backups fail, leaving data unprotected and 40% of CXOs have cited COVID-19 and economic uncertainty as the biggest threat to their organization’s Digital Transformation in the next 12 months.

Over 3,000 IT decision makers were surveyed at global enterprises to understand their approaches to data protection and data management. The study examined how organizations expect to be prepared for the IT challenges they face, including reacting to demand changes and interruptions in service and global influences such as COVID-19.

Danny Allan, Chief Technology Officer and Senior Vice President of Product Strategy at Veeam said, “Over the past 12 months, CXOs across the globe have faced a unique set of challenges around how to ensure data remains protected in a highly diverse, operational landscape. In response to the pandemic, we have seen organizations accelerate DX initiatives by years and months in order to stay in business. However, the way data is managed and protected continues to undermine them.”

Urgent action on data protection required

According to the report, respondents stated that their data protection capabilities are unable to keep pace with the DX demands of their organization, posing a threat to business continuity, potentially leading to severe consequences for both business reputation and performance.

Despite the integral role backup plays in modern data protection, 14% of all data is not backed up at all and 58% of recoveries fail, leaving businesses’ data unprotected and irretrievable in the event of an outage by cyberattack.

The report also notes that unexpected outages are common, with 95% of organizations experiencing them in the last 12 months, and with one in four servers having at least one unexpected outage in the prior year, the impact of downtime and data loss is experienced all too frequently.

Businesses are seeing this hit their bottom line, with more than half of CXOs saying this can lead to a loss of confidence towards their organization from customers, employees, and stakeholders.

“There are two main reasons for the lack of backup and restore success: Backups are ending with errors or are overrunning the allocated backup window, and secondly, restorations are failing to deliver their required SLAs,“ said Allan.

“Simply put, if a backup fails, the data remains unprotected, which is a huge concern for businesses given that the impacts of data loss and unplanned downtime span from customer backlash to reduced corporate share prices.”

IT strategies impacted by COVID-19

The report notes that CXOs are aware of the need to adopt a cloud-first approach and change the way IT is delivered in response to the digital acceleration brought about by COVID-19.

Up to 91% of CXOs increased their cloud services usage in the first months of the pandemic, and the majority will continue to do so, with 60% planning to add more cloud services to their IT delivery strategy.

However, while businesses recognize the need to accelerate their DX journeys over the next 12 months, 40% acknowledge that economic uncertainty poses a threat to their DX initiatives.

DX starts with digital resiliency 

As organizations increasingly adopt modern IT services at rapid pace, inadequate data protection capabilities and resources will lead to DX initiatives faltering, even failing says the report.

CXOs already feel the impact, with 30% admitting that their DX initiatives have slowed or halted in the past 12 months. The impediments to transformation are multi-faceted, including IT teams being too focused on maintaining operations during the pandemic (53%), a dependency on legacy IT systems (51%) and a lack of IT staff skills to implement new technology (49%).

In the next 12 months, IT leaders will look to get their DX journeys back on track by finding immediate solutions to their critical data protection needs, with almost a third looking to move data protection to the cloud.

“One of the major shifts we have seen over the past 12 months is undoubtedly an increased digital divide between those who had a plan for Digital Transformation and those who were less prepared, with the former accelerating their ability to execute and the latter slowing down,”

“By 2023, 77% of businesses globally will be using cloud-first backup, increasing the reliability of backups, shifting cost management and freeing up IT resources to focus on DX projects that allow the organization to excel in the digital economy,” concluded Allan.

Other highlights of the Veeam Data Protection Report 2021 include:

  • Hybrid IT across physical, virtual and cloud: Over the next two years, most organizations expect to gradually but continually reduce their physical servers, maintain, and fortify their virtualized infrastructure, and embrace “cloud-first” strategies. This will result in half of production workloads being cloud-hosted by 2023, forcing most organizations to re-imagine their data protection strategy for new production landscapes.
  • Rapid growth in cloud-based backup: Backup is shifting from on-premises to cloud-based solutions that are managed by a service provider, with trajectory reported from 29% in 2020 to 46% anticipated by 2023.
  • Importance of Reliability: “To improve reliability” was the most important driver of a global organization to change its primary backup solution, stated by 31% of respondents.
  • Improving ROI: 22% stated that the most important driver for change was improving the economics of their solution, including improving ROI/TCO and reducing.
  • Availability Gap: 80% organizations have an “availability gap” between how fast they can recover applications and how fast they need to recover them. 
  • Reality Gap: 76% have a “protection gap” between how frequently data is backed up versus how much data they can afford to lose after an outage.
  • Modern Data Protection: 46% of organizations around the globe will partner with a Backup as a Service (BaaS) provider by 2023 and 51% plan to adopt Disaster Recovery as a Service (DRaaS) in the same timeframe.