A successful entrepreneur shares her thoughts on business success and failure.

Are You Making This Common Mistake (That Could Ruin Your Business)?

common mistake in business?
Erica’s note: This is a true story. All names in this post have been changed to protect the parties involved.

During the last recession, in 2002, I picked up some contract PHP programming work to make ends meet. One of the clients I picked up shared an office with another firm. The firm was successful, and I talked to its owner, Sam, fairly often. His business did a few million dollars a year in sales, and Sam himself was wealthy. He was also an excellent business owner.

He considered his employees valuable assets and invested in top-of-the-line computer systems to make sure they could do their jobs well. His business used computers heavily, creating a set of files for each client that were then kept forever should the client ever come back and want more work done. (For this post, it’s not relevant exactly what his business was, although you can replace it with any business that works heavily with computers and keeps a “master record” of client files, such as any accountant or law firm…or perhaps your own business!)

He had a state-of-the-art network setup, especially for the time period. All of the computers his employees used were networked to a file server where all the master documents were kept. That way, any employee could go to the file server, pull up the folder pertaining to a certain client, and work with their documents. Changes were then automatically saved to the file server so no employee ever had to worry about where the latest copy was. Sam’s employees printed out hard copies whenever a client came in, but the records on the file server were the masters.

Sam didn’t believe in hiring cheap labor, so he hired a local tech guy, Mark. Mark’s tasks included setting up new computers, maintaining the network, and making sure the file server was always available, since it was the “brain” of Sam’s business. Sam, having been raised near Silicon Valley and being fairly technically savvy, was insistent that Mark do regular backups, since he knew how much damage it could do to his business to lose all of the master records for his clients.

Sam spent a lot of money to ensure that his computer systems and network had high uptime, since even an hour or two of downtime cost his business thousands of dollars. He was also security-paranoid; the file server and his office computer weren’t connected to the Internet, as to reduce the chance of either one getting infected with viruses.

In summary, Sam was a fairly technical, smart, savvy business owner who seemed to be doing everything he could to ensure that his multi-million dollar business would continue running with no downtime.

Sam’s Costly Mistake

Then, one day, disaster struck. Sam had relied on Mark to perform regular backups. Unfortunately, Mark, in the interest of billing more hours to Sam, had set up a manual backup process that relied on him, Mark, physically coming into the office and swapping out backup drives, then taking the backup drive back to his office for safekeeping. Sam was in the process of changing this manual process when the entire file server crashed. Sam was upset, but he called Mark and asked for the backup drive back to restore all the data.

A quick technical detour: Mark had set up Sam’s file server with cheap hardware RAID-5 with three drives. The “backup” process basically was Mark coming into the office, swapping one of the three drives, and rebuilding the array. Unfortunately, Mark, not understanding quite how RAID-5 worked, had taken the parity drive back to his office.

This wouldn’t have been a problem had a single hard drive in the array died, which was what Mark assumed would happen. What actually happened was that the entire motherboard failed, taking the cheap onboard RAID controller with it. This was one of those uber-crappy controllers where if the controller died, there was no ability to recover the array.

In plain English, the failure of a single cheap part had just brought Sam’s business to its knees.

In a panic, Sam called in another computer specialist, but the data was a jumbled mess. Sam eventually ended up calling a data forensics company that recovered most of his data…10 days later, and costing Sam thousands of dollars.

Can you imagine what would happen if your multi-million dollar business was down for 10 straight days, and you had none of the master records your clients depended on you to keep?

I’m telling you this story not for Sam and Mark, but for you. I see far too many small businesses with no backups. With no backups, you are in a far worse position than Sam. If you take away one thing from this blog post, it is: If you don’t have an automatic backup system on your computer, you are guaranteeing that you will lose critical data at some point.

Don’t ignore this just because you have a “tech person” who does your backups, either. You should be in charge of backing up your business files and knowing how to restore them should data be lost.

Please read the rest of this post carefully. Follow the instructions below, and you will be backing up your files 15 minutes from now.

Backing Up

Here’s the backup system I use. It takes less than 15 minutes to set up and runs automatically. Plus, I will show you how to make sure it’s working.

The first step is to download Jungle Disk. It’s a great piece of software that allows you to easily back up on a schedule to the Internet. It costs $20 (there is a free 30-day trial) and then a small monthly fee, depending on how much data you have. As a point of reference, I back up both my server and my desktop computer to it, and my bill runs about $12-$13/month. Yours may be less.

Jungle Disk dumps your backups into a “bucket” on Amazon S3, which is then distributed to multiple datacenters around the world. Your data is secure, protected by multiple passwords. You can access it on multiple computers if you wish. Run through the setup program. If you don’t have an Amazon S3 account, Jungle Disk will walk you through setting up one. If you’re using Windows, Jungle Disk will ask you if you want to set up backups only, or as a network drive as well. I like setting it up as both, so I can access all my files on J: as well.

Jungle Disk will then ask you when you want to back up. I set mine to back up weekly, on Saturday night. I also checked the option to back up immediately if a scheduled backup is missed. If your computer is shut down during the scheduled backup time, when you turn it on again, it will start backing up right away. I recommend this option.

Jungle Disk will ask you what you want to have backed up. This is a good time to make sure all of your data files, especially from programs like Quickbooks that put them all over the place, are in “My Documents.” If they are scattered around your hard drive, make sure you move them all into “My Documents”. Then back up that, as well as your favorites. Unless you know for sure that you will need another folder if your computer crashes, you probably don’t need to back up anything else.

If you’re one of those people who stores important things on the desktop, first, stop that! But if you insist, make sure your desktop is backed up too. Take it from a former tech support person: Do not store important files on your desktop. Put them in My Documents instead.

Finally, Jungle Disk will start its first backup. Depending on how fast your Internet connection is and how many files you want backed up, this may take days. That’s okay — let it run, and don’t turn your computer off. This is a good time to clean out anything you don’t really need.

Only the first backup takes a long time; future backups only upload changed files, so they will be much faster.

If you ever need to restore a file, even if you’ve just done something silly like deleted a document you now need, just click the “Restore Files” button in Jungle Disk, or go to J: and copy the file back.

Time Machine and other “external drive” backup systems

If you have a backup program that backs up to an external drive, like Time Machine on the Mac, I recommend also setting up Jungle Disk. To me, it’s like buying home insurance. What happens if your house or office burns down, or thieves break in and steal your computer — and the external drive that’s sitting right next to it? Jungle Disk protects you from all of these scenarios, since your data is stored safely online. I have seen people get bitten by this before. Please don’t rely solely on an external drive.

And, for heaven’s sake, if you know anyone still using CD-RWs, DVD-RWs, flash drives, or worse yet, tapes to back up their data, please send them this article. Those are not sufficient as a sole backup method. Please urge them to join this century and also back up online!

I urge you to take this seriously. Sam’s story is only one of many I’ve seen — as the owner of a hosting company, I watched many people lose their entire business due to bad backups or no backups. I watched grown men and women break down and cry. On top of that, I have personally lost entire (profitable) websites due to corrupt backups.

For your business, backups are a life-or-death matter. Since Jungle Disk is so easy to set up, there is no excuse. Even if someone else handles your backups — even if you already back up to an external drive — even if you can’t afford the monthly fee — if you can’t afford to lose what’s on your computer, back it up yourself and check regularly to make sure you can restore files. Don’t make this common business mistake.

If this sobering reminder can prevent some of you from losing your entire business, I am glad to have been of service.

Recommended Reading:

  • Jungle Disk. Download it now and save yourself hours of hassle. It works on Mac, PC, and Linux. (This isn’t an affiliate link.)

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