Across all industries, the use of data and analytics is helping enterprises to achieve business resiliency, flexibility and improved management capabilities on a global scale.
In fact, 96% of senior business decision makers reported that clear data strategies have become essential to improving their organisations’ performance metrics.
For the financial services sector, this shift has sparked a revolution in the way banks store and manage their data. Last November, it was cited that 40% of IT decision makers are already using a hybrid model to manage their data and this trend is expected to continue. This topic is consistent across enterprises in the financial sectors with the adoption of a hybrid data cloud approach, offering improved flexibility and agility to enable banks to pivot their strategy when needed.
What is the hybrid data cloud?
It is a logical architecture and implementation that provides a consistent and intuitive experience for data users and developers. The approach provides improved data access, whilst protecting data security and governance, as well as providing open and extensible support for clouds, data types and data applications. This is being increasingly implemented by enterprises in the financial services sector as it helps them scale their organisation, utilise the best skills in effective teams and build a more efficient data-driven culture throughout the business.
When assessing the deployment of the hybrid data cloud, there is a set of key considerations and issues that must be pushed to the top of your business strategy:
1. Understanding the purpose of your data first
Recognising the value of data, and thinking of data as a key differentiator and business advantage is crucial. Before you begin the process of assessing your data infrastructure, you have to understand the purpose of the data you are analysing and how it aligns with your business goals. Once you have determined these attributes, you can move onto understanding what you are seeking to improve within your business:
- Do you reduce data warehouse costs?
- Improve the speed of your regulatory reporting?
- Personalise your customer journey?
Answering important questions like these will help you to understand which data your business should be focusing on, how you should be analysing the data and which use-cases to implement first to deliver the value. Understanding this is the first step to building your hybrid data cloud.
As customers and businesses become more connected, moving to a real-time data architecture will help transition how your business operates. It will help as a forcing factor for driving more timely data decisions and support the development of your data-driven culture. A product approach to data management and curation will lead to better decisions made in the operational aspects of data usage, related to who needs access to what data, with what levels of SLA on their access and use.
2. Including a multi-cloud approach matters
In my experience, a hybrid data cloud is becoming the most dominant pattern in the financial services sector, and although the specific profile varies from firm to firm, the needs are maintained. A chart from our recent Enterprise Data Maturity Research Report highlights this trend across businesses from a range of industries. One of the most interesting statistics here is that 36% of enterprises expect an increase in multi-cloud deployments in the next 18 months, due to improved flexibility, cost management and regulatory oversight prevalent for financial services.
3. Scaling costs back
According to our customers, one of the key benefits of a dynamically scalable environment is reduced costs. Axis Bank and Kasikorn bank are both good examples of customers that have benefitted from the flexibility of the cloud. They have been able to expand their processing power when needed, only paying for what they use. A further benefit is the ability to select the most cost-effective cloud service provider and transition workloads seamlessly between them. This option will become increasingly important to facilitate an effective cost management strategy and distributing workloads based on competitive pricing models.
4. Managing cloud concentration risk
With the UK’s Prudential Regulation Authority (PRA) recently highlighting concerns over the systemic risk of cloud service providers, cloud concentration risk has become a top business consideration to protect against financial instability. This is where a multi-cloud approach can offer individual organisations greater agility for when legislation changes, as well as improved collaboration across the whole financial services ecosystem – cloud service providers, regulators and financial services entities.
5. Making data accessible
Previously it has been assumed that the individuals requiring access to a company’s data are limited to data scientists or SQL experts. However, now it is more common for business decision makers and other departments to rely on access to this data. We all know data has value and we must anticipate that more and more people will require access to data in their day-to-day decision making. As a result, hybrid cloud environments play a critical role in allowing businesses to control data access while helping users to build data governance and security into the core principles of their data strategy. In the highly sensitive world of finance, it’s important to retain data context, lineage and accurate audit trails as part of this process.
6. Enabling the hybrid future
As more financial organisations seek new ways to unlock greater data insights from their business, digital transformation strategies will continue to evolve. Whether data is on-prem, in public or private cloud, as AI initiatives advance, and regulations change the deployment strategy must be proactively updated to keep up with new demands and value opportunities. Creating a blueprint for a hybrid data cloud is the first step towards creating an agile, enterprise data strategy that is proactive and responsive to industry developments and can play a critical role in maintaining business success for the long-term.