Cloud migration: Key considerations for financial services
Nicola Buckley, senior vice-president of advanced engineering and support centre at Park Place Technologies | 15:09 Thursday 18th July 2019 | 7
More than ever, it is imperative for financial services organisations to migrate to the cloud.
New demands from customers, along with increasing regulatory requirements, require organisations to have an IT ecosystem that can deliver increased agility, innovation and customisation.
Yet, despite recognising the multiple benefits of cloud-based IT, many financial services organisations have been hesitant to make the leap, primarily because of security, data privacy and compliance concerns. The process of migrating IT systems to the cloud — while simultaneously ensuring ‘business as usual’ for staff and customers — is not without its challenges. Here are seven areas to consider that will allow financial organisations to best reap the rewards, while making the process as efficient and straightforward as possible.
Strategy before action
Moving every IT system to the cloud may be appealing, but in practice, this is unrealistic. Not everything can, or should, be moved. Many applications and services are still not optimised for virtual environments, let alone the cloud. Businesses will also need to consider the order of migration and impact on operations and staff. Considering these unique needs is critical to unlocking the benefits of the cloud without compromising security, daily activities, existing legacy systems or wasting budget.
Interim planning is critical
The long-term plan may be to move a specific percentage of applications and data storage to the cloud, however, in the short term, businesses will need to consider how they will maintain accessibility and security of existing data, hardware and applications during the migration. Third-party suppliers can help maintain legacy systems and hardware during the transition to ease disruption and ensure continuity of service.
Careful disposal of legacy hardware
Cloud migration will inevitably involve the retirement of some hardware. The financial services industry contains a multitude of sensitive personal and financial information. Loss of data integrity in such highly regulated environments could have severe long-term consequences. It is imperative to ensure that any stored data is secure to avoid the risk of data breaches. Many organisations underestimate hard-drive related security risks or assume, incorrectly, that routine software management methods provide adequate protection.
Integration between cloud and on-site technology
Financial services organisations must develop ways to integrate premise-based hardware with cloud systems to ensure data and applications can work in tandem. This will smooth data transmissions between various information sources. However, it can be incredibly difficult. Cloud computing depends on a significant amount of oversight to ensure vendors are meeting service level agreements, keep budgets under control and avoid cloud sprawl. This vital work requires a different skill set, so businesses need to consider upskilling and retraining staff.
Streamlining ongoing hardware costs
Following cloud migration, as retained legacy IT systems age, dedicated hardware maintenance and support strategies can enable financial services organisations to reduce their costs — especially considering the cost of OEM extended warranties. In fact, a third-party maintenance provider can provide required support for almost half the cost. This means financial services organisations can free resources to support the systems that remain in the on-site environment.
Short-term pain for long-term gain
While some organisations are understandably hesitant about the impact of cloud migration in terms of operational disruption and costs, it’s worth remembering that, in the long term, moving to the cloud will allow financial organisations to unlock the potential of a more flexible, scalable and resilient IT system so they can focus on delivering improved services for customers and increasing innovation.
Adopt an end-to-end approach
Moving to the cloud, in whatever capacity, means a new way of doing things. This means an organisation must adapt and manage its new ecosystem accordingly, unifying it from support and cost perspectives, as well as control risk and security. The best way to do this is to deploy a comprehensive solution that encompasses the full lifecycle of cloud adoption, from strategy to implementation, and provides a vertically integrated solution view for applications, infrastructure and operations. However, whatever the measure, adopting a full end-to-end approach is critical and will benchmark excellence for future projects.
SIGN UP TO OUR NEWSLETTER TO RECEIVE MORE NEWS LIKE THIS STORY
Gravity selects Finastra to power banking and lending services
Gravity has selected Finastra’s Fusion Essence in the cloud solution for its end-to-end core banking capabilities...
An interview with Paul Stockwell: Islamic finance has ‘enormous opportunity’ for growth over coming years
In an interview with Specialist Banking, Paul Stockwell, chief commercial officer at Gatehouse Bank (pictured above), discusses increasing awareness of Islamic finance and opportunities in the banking world...
Revolut for Business launches expense management tool
Revolut for Business has launched a new expense management tool designed to simplify the handling of expenses for growing businesses...
Leek United strengthens intermediary team
Leek United Building Society has strengthened its intermediary team with five new appointments...
BCR awards £10m to Atom bank
Atom bank has received a £10m grant as part of the Capability and Innovation Fund Pool C grants announced by the board of Banking Competition Remedies (BCR)...
Bank of Ireland UK updates broker portal
Bank of Ireland UK has revealed that it has relaunched its broker portal...
Unity Trust Bank increases lending by 47%
Unity Trust Bank has reported an underlying pre-tax profit of £4m in H1 2019, an increase of £1.2m compared with H1 2018...
Taxing times for SMEs
Small business owners are the most creative and resilient individuals I know...
Metro Bank to open first store in the Black Country
Metro Bank is set to open two stores on 20th and 21st September in Solihull and Merry Hill...
TMA Club adds Harpenden Building Society to lender panel
TMA Club has added Harpenden Building Society to its lender panel, giving its members access to the building society’s range of mortgage products...
N26 appoints chief banking officer
N26 has appointed Thomas Grosse (pictured above) as its new chief banking officer...