Cloud migration for financial organisations: key considerations
Over the years, the financial sector has struggled with cloud migration. Find out why and how to address it.
In the world of cloud migration, it's become a cliche to say that no sector has been left unchanged. But there's one sector which has proven a little more stubborn than others: the world of financial services.
It's not all doom and gloom. While research from
Accenture on cloud outcomes revealed that "40% of banks and less than half of insurers fully achieved their expected outcomes from migrating to cloud", it's worth remembering that 40% is still a significant figure. This is especially the case when you consider just how recent these cloud-based solutions are.
Nevertheless, the financial sector faces challenges that others don't. This is partly because of a historic trepidation about the cloud.
Cloud services are, most would agree, efficient, flexible and agile. But when it comes to the workloads of financial organisations, does it really make sense to shift operations onto third-party servers? Aside from anything else, won't business-as-usual suffer during the migration?
This has meant that, in the words of a writer for Forbes, "the easier, less risky projects were tackled first… and on their own… the migration of workloads seldom happened within a coordinated, enterprise-wide initiative.
"Where we are today," she goes on, "is that the low-hanging fruit have been harvested and, for any financial services executives, the yield has been disappointing."
It doesn't have to be this way. In this article, we take a closer look at some key considerations that financial organisations should keep in mind when migrating to the cloud. Taken together, they can help any organisation work towards better cloud outcomes.
1. Security and compliance
All sectors are regulated – these days, even cowboys have rules to follow. Regulation in the financial sector has become a hot topic since the global financial crash of 2008 – and while progress still remains to be made, most financial organisations want to be on the right side of regulations.
Moving to the cloud means spreading risk and responsibility. This raises security issues when hefty tranches of financial data are in play.
This is a key driver behind the increased adoption of hybrid and multi-cloud environments. Indeed, "multi-cloud" is fast becoming a tautology. If your organisation handles sensitive data, it can be wise to keep it locked down in an on-prem server. Less critical data can then be stored on the public cloud.
This many-headed approach is the best way to unlock the cloud's cost savings while also keeping business-critical and sensitive data under lock and key.
But solutions themselves aren't enough. You also need to adopt a rigorous cloud security policy to ensure effective governance. Rules, processes and policies lack the glamour of digital transformation itself – but without them, you're in for a rocky ride.
2. The pace of change
Everyone in the upper echelons of the business world will be familiar with the injunction to do things
fast. Indeed, so-called industry disrupters like to "move fast and break things": the tech world's equivalent of James Dean's "Live fast, die young, and leave a good-looking corpse".
Some industries thrive on novelty. It's where they get their competitive edge. Financial services is not one of them. There, caution is the order of the day.
Some of the financial sector's problems with cloud solutions have stemmed from a piecemeal approach – but that doesn't mean a piecemeal approach is in itself problematic. In fact, proceeding slowly but surely can be advisable, so long as it's in pursuit of a long-term, large-scale aim.
3. Cloud shock
We've all ordered a meal at a restaurant and gone pale when we saw how much it came to. The same thing can happen with cloud migration. In fact, it's such a common experience that it's got a name: cloud shock.
One of the main reasons to migrate to the cloud is to cut costs. But all too often, organisations dive headlong into a multi-cloud approach and watch in mute horror as costs begin to spiral unexpectedly.
Cloud shock isn't inevitable. The chances of it happening can be drastically reduced by thorough planning – something that a cloud consultant can help you to achieve.
4. Knowing your strategy
Migrating to the cloud without a business plan is like hiking in the Amazon without a map. Having a strategy that's in line with your business goals is paramount if you want to get to your destination.
It's obvious, right? Well, apparently not. Technology research firm
Gartner has estimated that "less than one-third of enterprises have a documented cloud strategy". Imagine writing a similar sentence about health and safety, inclusion and diversity or the recruitment process.
Before any kind of migration takes place, you need to do a thorough audit and analysis of your systems, apps and processes. Otherwise, you'll end up Cloud Creek with an overpriced paddle.
Do some applications need to be retired, replaced or re-hosted? That's a question you should be able to answer long before you get to work.
What's more, you need a clear timeline – one that lays out the upcoming waves of migration as well as measures to mitigate any disruption they cause.
5. Keep the customer satisfied
As technology changes, so too do customer expectations. As well as prioritising data governance, compliance and budgetary constraints, financial organisations should always keep in mind that the customer is also part of the transformation.
This could mean, for instance, coordinating internal teams and external partners to deliver the products and services that customers have come to expect – a consideration that can, in turn, affect the nature and cost of the cloud migration.
Conclusion
Moving to the cloud is a complex endeavour, especially in the financial services sector. Keeping these key considerations in mind, however, will help you to hit on the right course of action. We hope you get the cloud outcomes you deserve.
Are you looking for a
cloud computing specialist to help you conquer your migration? At Ascend Cloud Solutions, we've managed more than 400 migrations and counting.
Get in touch today for a no-obligation consultation.
