• The ability to provide unique types of services in marketplace , such as new investment types . Considering that their products are rather abstract , this becomes a core focus since they have much the same products as their competition .
• The ability to become agile . Most financial services companies are big and bulky . Over the years they have become siloed , and are hard to change . IT could not keep up . But with cloud-based platforms that are scalable on demand , and quick to change , they may be able to fix that problem .
• The ability to remove cost . At cloud computing ’ s core is the ability to provide more efficiency . This includes the ability to have much lower operational costs . While the financial sector has not had to economize much in comparison to other vertical sectors , today they want to tighten IT belts . Typically first on the agenda is a move to the cloud .
What about the risks ?
What specific risks does the cloud pose for financial services companies ? Security comes to mind most often , considering that they have the most to lose if breaches and security issues become a problem .
That said , cloud computing seems to be a security upgrade , and actually removes risks in most cases . Indeed , I declared this back in 2015 , and there has been no additional data to indicate that I was incorrect in making those assertions . I wrote , “ What public clouds bring to the table are better security mechanisms and paranoia as a default , given how juicy they are as targets . The cloud providers are much better than traditional systems at systemic security services , such as looking out for attacks using pattern matching technology and even AI systems . This combination means they have very secure systems .”
Just Look at the Top Cloud Consumers
Who ’ s who in cloud users is really around the financial sector . Capital One made the largest public cloud deals to-date last year with AWS , and other financial firms are following suit , in terms of both scope and size of their migrations , or net new application implementations .
Basically , when asked about the whys , they pretty much stick to the items outlined above , such as agility , cost control , time to market advantages , etc . However , the biggest pattern that we ’ re noticing in this industry is the fact that the financial sectors get more back from their investment in technology than other sectors .
In other words , if somebody who owns and operates a paper mill invests into a cloud migration project , they may get 10 times their investment back over a 5 year period of time . However , if a financial firm invests in the same types of technologies , they may get 200 times their investment back , considering the benefits listed above .
30 | THE DOPPLER | SUMMER 2017