One in three organisations cannot recover files from backup tapes and a similar number would not be able to easily retrieve email from 18 months ago, according to research from data storage specialists Hitachi.
Neville Vincent, Hitachi's Australian chief executive, said a third of organisations were so choked up with digital information it was having an impact on business results.
"Digital information growth is not new. What [the research] did highlight for us is the true business impact that the growth of digital information is having on businesses today," he said.
Vincent said realisation that an "information glut" was having a significant impact on business performance could signal a tipping point in the management of digital information.
Researchers Sweeney Research surveyed 400 firms with 100 or more employees in New Zealand and Australia. In total, 95 per cent of the organisations surveyed said their business was suffering as a result of the excessive growth or mismanagement of digital information.
More than 10 per cent said the information glut was having a serious impact on their business.
Susan Williams, associate professor at the University of Sydney's faculty of economics and business, said the findings back up her own research in the area of digital information management, but she was surprised by the extent of the issue.
"I think it's something that is not completely recognised by organisations," said Williams. "Even though they are suffering from [information overload] it's not always a priority for them to solve this problem."
She said organisations needed to make information an everyday practice rather than it becoming a priority when information was lost, accidentally released to the public or was needed during litigation.
A third of companies surveyed admitted they would have difficulty responding to a discovery audit for emails more than 18 months old.
Vincent said the vast majority of businesses were leaving decisions about retaining or deleting email in the hands of their staff, exposing companies to compliance risk such as a court-ordered discovery process.
"The regulatory requirements to ensure the integrity of business is only going to get more stringent and I think organisations haven't actually woken up to the fact yet," said Vincent.
Williams said organisations needed to return to traditional information management practices such as understanding what information was critical for the business and archiving or destroying anything that was no longer needed on a day-to-day basis.
"I don't think it's about getting more technology, it's about managing information better," said Williams.
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