Company insight
Banking on a multicloud future
One of the biggest challenges faced by banks today is modernising a highly complex IT estate and moving to a scalable cloud-based infrastructure. Achieving this transition rapidly, to keep pace with competitors and deliver modern digital experiences for customers and employees alike, is no mean feat. Future Banking talks to Dean Clark, chief technology officer at cloud engineering specialist GFT, about the many challenges and benefits of cloud migration.
he transition of banking technology infrastructure to the cloud is no longer a choice, but an imperative. Banks know they have to leverage the cloud to deliver agile, up-to-date and cost-efficient services – and simultaneously address their sustainability agenda. But with thousands of applications and no set model for what cloud-based infrastructure should look like, that journey is fraught with challenges.
T Dean Clark,
chief technology officer, GFT
banks are trying to apply the same rules as they would for their own data centre – which is stifling innovation and agility.”
Beyond those challenges, however, lies the promise of great benefits: not least scalability, agility and a simplified approach to compliance that can help banks to meet the ever-changing demands of regulators. Banks need a road map through risky terrain, but they need to first understand what the challenges are.
Bridging the skills gap “We have a lot of experience working with banks and the skills gap is the biggest challenge,” says Dean Clark, CTO at cloud engineering services provider GFT. “There is a war for talent across the global market, particularly people who have worked with the cloud before and, preferably, cloud transformation processes.” “At the moment a lot of banks are scrambling to lure this talent away from fintechs and the big technology companies,” Clark continues. “Then there is the regulatory challenge. Regulators have not fully caught up with what it means to move to the cloud. They need to lock down those grey areas. Then there is security. There are few junior people with security expertise in banking, so
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Bespoke cloud strategies While some banks have been quick to embrace digital transformation, others are lagging behind, whether through inertia or a lack of relevant skills. “We’ve worked with some banks that have been trailblazing in their approach to cloud modernisation,” explains Clark. “They didn’t just pick up their virtual machine estate and move it to the cloud. They focused on what their customers wanted and got the underlying cloud infrastructure right from the beginning, which allowed them to focus on innovation. We have, however, seen banks simply following the leader and seeing costs rise and agility suffer.” In short, banks face many choices in their cloud migration journey. That’s similarly true when it comes to deciding if they want to leverage public cloud services – with all the concerns over security that arise – or the less versatile, and less cost-efficient private cloud route. The answer may be to use both and to explore the use of multiple vendors: the so-called multicloud approach. “We see a lot of banks worried about regulation and data security with public cloud, and sometimes the only solution is to keep personally
identifiable information on a private cloud,” Clark says. “But one of my biggest frustrations is banks copying and pasting their infrastructure onto a public cloud provider without planning how they will operate it. “Where we see savings is when clients have paid attention to the target operating model and the business strategy, putting the needs of their customers first and building their cloud journey around that,” he continues. “Some are still using on-premise private cloud infrastructure, while others are using a multicloud model, selecting two or three vendors with strengths on different workloads.”
A multifaceted future
Managing multiple cloud service providers certainly adds complexity – but with the right tooling in place to manage all cloud solutions in the same way, it is certainly possible. To put it another way, the future of the cloud in banking may well have many different faces. “Retail banks are trying to compete with the challenger banks, and investment banks are addressing how siloed they are, with different business divisions taking different approaches to the cloud,” says Clark. “I’m looking forward to the future – seeing what new technologies can bring.” A multicloud future may be a long way off, and cloud migration as a whole is still a work in progress for the banking industry. But some major transformational progress has already been made – even as the learning curve gets steeper every day. ●
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