"Financial services firms were once slower than businesses in many other sectors to invest in data centers and cloud computing. They face similar challenges to managing large-scale infrastructure as industrial companies and are the only equal to healthcare in terms of the many layers needed to safeguard the personal information of their customers. However, firms cannot put off data and cybersecurity concerns any longer. The task now is to quickly ramp up back-end infrastructure, information management and full-scale network protection.
Fortunately, the sources of financial services firms' pressing issues can also be enablers of a stronger, more adaptable business model. Banks, credit unions and other organizations can leverage big data and analytics to consolidate their customer engagement and fulfillment processes, make more informed cross-channel decisions and protect themselves from rising cyberthreats. To make successful use of data and business intelligence, financial services companies will need to invest more aggressively in data centers, cloud computing and network infrastructure. By outsourcing these needs through colocation or in a third-party data center, firms can cut costs, become more efficient and ultimately position themselves to better face upcoming challenges.
Firms Banking on Data Centers
A recent report by the Uptime Institute found that financial services organizations are making the addition of data center space and capacity a high priority. In doing so, they're taking a slightly different approach to data center space acquisition and investment, said the report's author, Matt Stansberry, according to EnterpriseTech.
""They are looking at the datacenter as a business,"" Stansberry said. ""Colocation providers and financial services data center organizations are on similar maturation paths""
The need for speed in ramping up infrastructure and data center footprints is one reason that colocation providers and financial services firms have found themselves with similar goals. The ability to quickly deploy server infrastructure and surround it with best-in-class network and workload infrastructure decreases start-up costs and positions the organization to start benefiting from their investment almost immediately.
Financial services are also going modular for much the same reason. The companies that were in the first wave of data center adopters have seen how difficult it is to keep large-scale onsite facilities functioning at full capacity, with a healthy ROI. Many have begun working with modular providers to design, deploy and manage prefabricated data centers so that capacity can be added in a piecemeal and constant fashion.
""The banks are really paying attention to efficiency,"" Stansberry said.
Big Data, Big Money
As firms build up their data center presence and portfolios, they need something to store in them. Big data is a much-ballyhooed technology with seemingly limitless applications, but some of the most effective ones are right in the banking and credit card industry's wheelhouse. There are several major aspects of financial services firms operation that big data, the cloud and data centers can supercharge, making firms more cost-efficient to run. Two of the most important aspects are customer relationships and cybersecurity.
Customer Engagement: More than 75 percent of organizations in the finance sector plan to invest in big data to enhance their customer transactions and marketability, according to one recent AIG survey. With big data and analytics insights, these businesses can effectively redesign their end-to-end customer fulfillment strategies, using data to make predictions, better market their products and improve every interaction. This enables them to build the critical cross-channel capacity that they need, putting information and real-time observations at the fingertips of customer service professionals and building better websites.In order to ensure these features all function correctly, firms will have to invest in the cloud and data centers to keep all applications and data fully updated, integrated and available. Modular designs can help in this regard, as organizations can build up capacity on the fly as they accumulate more data and grow their application portfolios.
Cybersecurity: Data centers and the cloud can help banks improve the information management strategies they already have in place, as well as provide support for information requirements rapidly coming into focus. Most banks use some sort of central repository for information, but actually leveraging it for actionable insights can be quite difficult, wrote Forbes contributor Steve Culp.""Banks feed data from many sources into centralized monitoring systems, but maintaining the quality of data in terms of accuracy, timeliness and other factors is increasingly difficult,"" Culp wrote.Firms need more robust processing tools, stronger analytics applications and infrastructure that can adequately support it all. Efficiency- and capacity-building are critically important to being able to sum up the resources to make it happen. By investing in third-party data centers, banks can ensure that their data is available, managed and secure. These protective and maintenance features can then be marshaled into more effective data loss prevention, transaction monitoring and preventative reporting, keeping data safe and organizations out of hot water."