The temptation for Chief Information Officers (CIOs) to self-insure business-critical software often happens after they’ve had a few bad experiences with escrow service providers that deliver substandard service. CIOs may feel they are best suited to insure their mission critical business processes that they are responsible for maintaining.
“The answer to abuse is never non-use, it is correct use!”
The high stakes when CIOs insure software
Consider what’s at stake if the software owner’s (developer) lights go out. What will the business do if they are unable to support the product that they have sold to you?
- Investment risk. The total capital investment in the software product is the sum of the initial purchase costs plus the thousands of man hours implementing and customising the software, training staff, educating users, and improving productivity. All of this is at risk.
- Brand damage. The reputational damage caused by operational downtime can be significant. In our world of instant solutions, when your platform doesn’t work, customers are left frustrated and simply click across to your competitors offering, leaving you with fewer customers, reduced revenue and significant harm to your brand.
- Profit loss. The actual revenues associated with the business processes that are dependent upon the product that has failed need to be considered.
- CIO job security. The CIO’s position and future professional life is on the line. Should they decide to self insure, and things go wrong, the consequences will certainly reach beyond the corporate collateral and into the personal and professional life of the decision maker themselves. When you have made a call that has cost the enterprise millions and resulted in chaos and distraction for the C suite, you may find yourself without work, and other enterprises may not be queuing up to offer you a new position.
Leading CIOs Insure their Software with ESCROWSURE
Software Escrow is recognised globally as best practice for those adopting third party owned software for mission critical business functions. Given the severe downside of disaster recovery without escrow protection, the business case for active software escrow is excellent.
ESCROWSURE is the Leader in South African Technical Escrow Solutions.
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