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Offering FX brokers four steps to prepare for Disaster Recovery


By Chad Stanfield, Vice President of Field Engineers at InMage Systems Chad Stanfield


In today’s climate, most enterprises maintain some form of business continuity plan. Business continuity plans provide a way for an enterprise to continue functioning in the event of a catastrophic disaster that shuts down business operations at one or more primary locations. Business continuity plans cover information technology (IT) infrastructure recovery,


human capital issues that arise when business operations must be restarted at a remote location, and physical infrastructure issues, such as re-establishing communications, ensuring physical security, and providing appropriate work areas at remote locations. IT infrastructure recovery, sometimes referred to as disaster recovery (DR), addresses the issues involved with recovering computing equipment (servers, storage, etc.), data, and application services. DR provides a necessary foundation for business continuity plans but is not a substitute for them. An effective DR plan is especially important for online foreign exchange (FX) brokers, whose trade servers are absolutely essential to their businesses. Any downtime events, such as a server failure, virus or natural disaster, significantly affects a broker’s ability to complete transactions, generate revenue and service its customers. FX brokers also operate in an increasingly strict regulatory environment. The National Futures Association (NFA) requires all members to adopt a disaster recovery (DR) plan reasonably designed to enable them to continue operating, re- establish operations, or transfer their business to other members with minimal disruption to their customers, other members, and the commodity futures markets. Additionally, all downtime events must be reported. This article will focus on the key elements of creating an effective DR plan, and then provide a short case study of how a leading provider of foreign exchange trading services, Interbank FX, implemented an updated DR plan to meet their requirements.


74 | INSTITUTIONAL FX SERVICES - THE BROKERS HANDBOOK 2012/2013


Market Forces Driving Change


Te conventional approach to DR was to periodically ship copies of backup tapes to remote locations, where they were often stored for years, to ensure data recovery in the event of catastrophic disasters which may shut down primary sites. In the world of DR, two key metrics govern recovery capabilities: recovery point objective (RPO) and recovery time objective (RTO). RPO defines the minimum acceptable level of data loss (e.g. no more than 24 hours, no more than 4 hours, etc.) per recovery event, while RTO defines the maximum acceptable time to recovery (e.g. data and/ or applications restored and running within 8 hours, etc.).


Remote recoveries from tape generally exhibit lax RPO and RTO. By the time tapes are stored at a remote location, the data may already be several days to a week old, and recovery can easily require several days to a week. Data is growing at unprecedented rates, and evolving business and regulatory mandates are driving ever more stringent recovery requirements. For most critical application environments, a tape-based DR approach just can’t meet these requirements, putting businesses at risk for lost revenue, poor customer service, and, in certain extreme cases, overall business viability. Tese market forces are driving many foreign exchange brokers to re- evaluate how they plan for DR.


Business process and outsourcing


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