For banks, cloud computing is a game-changer, but it also brings new issues in data management and regulatory compliance. Learn how to handle the implementation process effectively in this article.
It’s difficult to avoid the cloud these days, given the amount of problems surrounding it. Almost everyone in the information technology industry seems to be talking about SaaS, integration, mobility, and how they are altering digital banking solutions. The reality is that the cloud is a game-changer for the organization and that making the shift is well worth the effort, despite it seeming overwhelming at first.
Discovering the perfect fit and mix of solutions for your firm, as well as effectively configuring these solutions, can be a complicated process. Banks are among the organizations that find it most difficult to transition to the cloud because of the stringent laws regulating the financial services sector.
Most of the time, the most significant difficulties for banks trying to move to the cloud — whether it’s for CRM, ITSM, messaging and collaboration, or anything else — center around data. How do you precisely know what information you can store in the cloud when there are data privacy and residency concerns? In addition, taking into consideration the mobility made available by the cloud simply adds another layer of worry about compliance concerns, since once this data becomes mobile, how does the bank know where it is going?
In spite of these difficulties, banks may nevertheless succeed in migrating to the cloud and enjoying the advantages that have been repeatedly touted. How did you figure it out? Education and strategy are combined successfully. While there is no specific recipe for success, the following seven stages may serve as a guide for financial institutions:
- Make a practical business case.
It’s critical to prepare ahead before tearing down your present systems and introducing your consumers to the cloud. This preparation should involve articulating clearly the advantages you anticipate deriving from the new solution as well as how this change will aid in the achievement of company goals. Take the time to understand your present and future processes, and ensure that the cloud solution can provide you with the features you want before using it.
- Research the industry
Any bank contemplating a move to the cloud should do a thorough study before making the decision. Investing the necessary time to learn about the available solutions should alleviate concerns about the cloud’s ability to meet the stringent regulations imposed by banks. There are a number of solutions designed to assist banks in complying with these regulations, like the Oracle digital banking experience. Additionally, many of your bank’s competitors are effectively transitioning to the cloud if they haven’t already done so.
- Take advantage of peer reviews
Getting together with your peers and listening to their tales is one of the most effective measures you can take. Even though hearing generic statements such as “This is why you should move to the cloud” or “This is why this solution is the best available” may provide a good foundation for your cloud education, hearing first-hand from people who face the same regulations as you about how they were able to move to the cloud is far more valuable. Make it a point to attend events or user groups where you can network with individuals from other banks using cloud-based solutions. Inquire about their solutions, how they’re employing them, and the steps that led them to this point in their careers. This will provide you with an insight into what you should be looking for during the discovery phase, as well as what to anticipate once you’re ready to begin the migration process.
- Create the suitable TCO model.
The fact that your bank has made considerable investments in infrastructure that the cloud will replace is undeniable, and you’ll have to explain the additional costs associated with not utilizing that infrastructure. Remember to include the cost of maintaining the on-premises hardware when developing your total cost of ownership model for the cloud solution and comparing it to the cost of maintaining the legacy infrastructure. Keep in mind that the infrastructure needs extensive IT administration and maintenance and monthly patches and updates, which may be costly if you don’t keep up with the latest technological advances.
- Determine what data belongs in the cloud
Although going to the cloud may eliminate some outdated hardware, your bank will most likely need to maintain some on-premise systems in order to remain competitive. It does not make sense for all of the data banks have, such as credit data and client transactions, to be stored in a cloud environment. Part of this choice will be influenced by regulatory requirements for data retention, which will necessitate the storage of archived data on-premises and data encryption. Put forth the effort to establish what should be stored in the cloud and what shouldn’t.
- Pay close attention to your data and integration strategies.
In light of the fact that you will have many solutions in place, decide which system will serve as the master when it comes to data governance. Historically, banks have been account-centric organizations. However, the move now is to be more client-centric. Therefore, you must ensure that your data is set up to reflect this new paradigm. Aside from that, spend the necessary time planning your integration strategy to guarantee that these systems will interact with one another in an appropriate manner.
- Leverage experienced resources
No matter how hard you attempt to make cloud computing appear and feel like your legacy system, it will never be the same. Even the most experienced IT experts will have a steep learning curve when it comes to configuring and administering cloud systems in the future. Many financial institutions believe that they can successfully transition to the cloud on their own since they have highly skilled technical personnel on their IT teams. However, much skill is required for the intricacies of cloud technology to be properly deployed. This necessitates seeking advice from someone knowledgeable about cloud technology as well as the banking business.
For banks, moving to the cloud using the OBDX is an option that they can take. To get the most out of your search, you need to take your time. Migrating your bank to the cloud has several advantages if you do your research and prepare ahead of time.