The widespread adoption of a hybrid cloud model – using a mixture of on-premises and third-party clouds – is in full effect. According to a recent report by McAfee, hybrid cloud adoption grew 3x in the last year, increasing from 19% to over half (57%) across organisations. And while this is true for most, one industry in particular is moving at a far more rapid pace – financial services.
The reasons behind the shift vary. For some, it is the opportunity to adopt a new agile way of developing and deploying applications. For others, it is a replacement for the on-premises data centre. Either way, various leaders within the finance industry – including HSBC and OakNorth – have already taken steps to adopt a cloud-centric strategy.
Yet despite the industry’s impressive move towards the cloud, many organisations are still facing significant pressure points when designing, implementing and deploying their hybrid cloud infrastructures.
Traditionally siloed IT
When designing and deploying hybrid cloud infrastructures within the financial services industry, one of the most common pain points tends to come from within. Traditionally speaking, most financial organisations have a history of being steeped in silos of IT. This is true across most parts of the business, including storage, networks, middleware, as well as within databases and applications.
But as an increasing number of firms are being pushed to implement new technologies that put the end user in control, many of the traditional silos are, as a result, breaking down through the cloud’s simplification of IT structures. This process has not only left the siloes condensed but has, to some degree, democratised access to IT capability.
Risk and financial spend
Another major challenge that financial organisations run into when considering the move to a hybrid cloud is risk. This is especially true when it comes to the process of identifying and mitigating risk, as it ultimately slows down and impacts any new hybrid cloud design. In order to get ahead of the potential impact that risk can have, organisations need to ensure that they have a deep understanding of the risk profile of all applications that may be moved or built within the cloud.
Having a complete understanding of which applications are present and how they are performing will put organisations in a good place to prepare for new security boundaries that need to be properly managed.
Once implemented, the public cloud infrastructure is actually known to be quite secure and built to a high standard, similar to many on-premise locations. Traditionally speaking, public cloud providers spend more on security than most financial services companies. As banks consider the hybrid cloud as an extension of their own data centre, security is often built to the highest standard, every step of the way.
The future of the hybrid cloud within financial services
Both start-ups and traditional financial services players are heavily depending on the hybrid cloud model to both innovate and disrupt their markets. One example is BBVA, the international banking group, which is working to transform its business model through digital services built and launched using the hybrid cloud. Working with key players on a range of hybrid cloud data services, the digital bank is working to develop its own Data Fabric strategy to support the next generation of financial services and products.
Though true of many industries, the future is particularly optimistic for financial services. The industry is going through a moment of disruption and the hybrid cloud model is offering unfettered access to a new level of agility as well as a diverse portfolio of new technologies such as artificial intelligence, analytics, serverless computing and quantum computing. Looking forward into the next few years, organisations within the space will likely start to see the impact of this technological access combined with new initiatives such as open banking.
In the end, building within the hybrid cloud can be complex for financial services organisations, especially when it comes to managing the development and operations of applications and data consumption. As the industry moves forward, those organisations that are traditionally inclined need to embrace this moment of digital transformation and experiment with building their own hybrid cloud model.
If they’re able to do this for enterprise data management and hybrid cloud application orchestration, they’ll ultimately be able to maximise the value the hybrid cloud can bring.
Read more: Hybrid cloud solution is no pie in the sky