User Experience Requirements Will Drive Cloud-Native Adoption in the Financial Industry, But Data Resilience Still Vital

By Dan Middleton, Regional Vice President for UK & Ireland at Veeam

Over the past decade, two big changes have taken place in the way companies create, deploy and use digital technology. The first is the consumerization of IT. In 2005, Gartner declared consumerization to be “the single most important trend affecting IT over the next 10 years”. After the dot-com collapse, enterprise IT budgets shrunk and vendors instead focused on targeting larger consumer computing markets. The result has been a change in the way technology has entered the market, including that of the financial sector. Instead of innovation starting in the business world and flowing to consumers, the consumer market would embrace new technologies before businesses. Accelerated and affordable improvements in mobile devices, connectivity, web applications and software have helped democratize computing and started this trend.

The other big change has been the arrival of digital natives in the workforce and their expectation that the enterprise technology experience will be more like that of consumers. They were less likely to distinguish between enterprise and personal technology, or to settle for using complex enterprise software when the consumer tools they are used to are more flexible and powerful. Hybrid and remote working has accelerated this trend, with employees away from the physical workplace and free to make more decisions about where and how they work. With around a quarter of UK employees working in a hybrid way according to the ONS, this should remain an important consideration for IT managers. Behaviors this pattern can create include personnel turning to familiar services to do their jobs (such as “shadow IT” and its likely payload of system exposures adding to the burdens of technical teams who often ignore such transgressions until it is too late).

Very high expectations

All of this has led to both customers and employees expecting instant results when using the technology. In a society where we all become impatient even in front of the microwave, there is little tolerance for delays or disruptions. Customers are accustomed to transactions and processes being as seamless as possible and will not hesitate to switch services if they become frustrated. With ever-increasing expectations for the customer experience and availability of services demanded of businesses, agility and rapid deployment of new products and services are now hallmarks of market leadership.

A case in point is the finance industry – a market disrupted by fintech brands that were designed from the start to be data-driven and branchless, and free from the legacy technologies and barriers that established banks had to face. overcome, while striving to innovate rapidly. By leveraging modern application architectures and DevOps practices associated with native cloud technologies, fintech challengers have been able to grow and scale without the associated high IT infrastructure and development costs normally associated with more traditional methods of software development. .

Cloud-native technologies have an important role to play in providing the right conditions for this to happen. A key benefit is accelerating development cycles by maximizing the performance of cloud-based tools. Due to the high degree of abstraction that cloud-native architectures allow – using application services and serverless functions wherever possible, so physical infrastructure is not something a business has to need to sustain – new digital services can be developed and brought to market much faster.

Plan for the worst

These benefits are not only realized when developing new applications. If a company needs to re-engineer an existing application to extend functionality, for example, cloud-native development strategies have an important role to play. Container technology, such as Kubernetes, has allowed organizations to take a modular approach to application management, enabling rapid deployment and updating across clouds.

But the consistent performance that a cloud-native environment can deliver is only possible if the data it all relies on is properly protected. A simple misconfiguration, data breach, or outage can cause huge disruptions if services cannot be restored quickly. The unfortunate example of Travelex is just one of many such incidents, where a ransomware attack brought down its systems globally and disrupted business for many months, leaving customers no way to access foreign currency. The impact of the attack was so severe that it eventually pushed the company into administration. In the rush to adopt cloud-native technologies and modern software development practices, rather than being mainstreamed, practical questions about resiliency, disaster recovery, continuity planning, and data protection can often move into the background. For an industry that was an early adopter of IT, trading room and back-office disaster recovery, and subject to FSA and PRA guidelines, such oversights have no excuse. Moreover, recent findings show little difference these days between “high priority” and “normal” data, with 64% of the former and 58% of the latter having a data unavailability tolerance of no more than one hour ( Source : Veeam Data Protection Trends Report 2022).

Inadequate data protection could be disastrous for the digital transformation initiatives that fintechs are trying to carry out and, in fact, undermine the benefits that cloud-native digital transformation can bring. According to Veeam Data Protection Trends Report 2022. What adds to the complexity of a modern application development methodology is that each of the hundreds of microservices that can make up a cloud-native application often has its own independently managed database instance, which makes applications insufficient traditional safeguards.

With applications and data now residing in physical, virtual, cloud and Kubernetes environments, and given the highly sensitive nature of financial and other information held by fintech organizations, all infrastructure vulnerabilities and single points of failure must be eliminated. The Veeam Data Protection Trends Report 2022 also revealed that 44% of finance and insurance IT managers consider the most important aspect of any enterprise backup solution to be the scope of the workload it protects. No wonder when 50% of respondents had ransomware outages in which 38% of data was unrecoverable, while 28% of servers experienced at least one unexpected outage. Those in need of such expertise or resources are best advised to partner with an expert modern data protection vendor with proven, specialized capabilities around cloud-native platforms and tools. With the rapid pace of development, deployment and change, such support must also be agile, flexible and adaptable. Supplier agnosticism and strategic vision should be sought.

The way computing powers our modern world has changed forever. Exciting microservices and cloud-native applications are reducing software development time and enabling more innovation, faster in their attempt to transform business models as they strive to meet changing customer demand. It is essential to implement a modern data protection solution that can operate in these new environments, and perhaps even anticipate the next evolution. This way, fintechs can remain confident that they can bring applications back online in the event of malicious incidents or human error, protect themselves and their customers from cyber threats, and easily roll back to previous versions if something goes wrong. as simple as an accidental deletion happened.

In order to move forward, no business wants a lack of resilience to hold them back.

Comments are closed.