Dispelling Myths about Cloud Computing
As we move toward creating faster and more secure ways of doing business and fighting financial crimes, we at Alessa have been asking ourselves some critical questions about what our clients need in order to have an AML compliance and continuous controls monitoring (CCM) system that will take them into the future.
A key hurdle that many customer face is the availability and scalability of IT resources and infrastructure. Keeping compliance and audit systems upgraded, secure and scaled to meet their growing needs is not always a top priority for businesses. To make the issue worse, often IT problems are only discovered when there is an interruption in service or a much-needed upgrade is delayed or failed.
We have been very bullish in our recommendation for customers to migrate their Alessa deployments to the cloud. While the use of the cloud by businesses has grown extensively, there remain many pre-conceptions or myths about the use of this technology. Everything from security to location of data are critical questions asked by IT, risk officers and the C-suite.
Here are some common misconceptions about the cloud, facts that dispel the myths and the reasons that Alessa is now collaborating with Microsoft to migrate and expand our Alessa solution in the Azure cloud.
Myth #1: The public cloud is less secure
Global public cloud providers like Microsoft are able to invest massive amounts of resources that exceed what any individual organization can realistically invest. It is estimated that Microsoft has more than 3,500 security professionals and spends over US$1Bn on cloud security annually. This is what allows them to use state-of-the-art technology, and employ the world’s leaders in cybersecurity.
Public cloud providers also invest heavily in monitoring of their infrastructure since it is one of their core value propositions and a cornerstone of their business. The constant monitoring along with their massive scale and geographic presence enables public cloud providers to detect emerging threats quickly and address issues before they gain traction.
Beyond security, ensuring compliance with global, local, and industry regulations is also a significant burden to individual companies. When organizations turn to a global cloud provider, they are inheriting the compliance and security certifications and standards of work already put in place for organizations around the globe. In this case, Azure has over 92 global, regional and industry specific certifications.
Myth #2: Your data will be stored internationally
Many organizations, including financial services businesses, require their data be stored in specific jurisdictions. It is for these reasons, that many public cloud providers have regional data centers.
In the case of Microsoft Azure, it has 58 worldwide regions and is available in 140 countries. There are multiple data centers in the U.S., Canada, UK, India, Africa, Australia, China, etc.
These offer the scale needed to bring applications closer to users around the world, preserving data residency, and offering comprehensive compliance and resiliency options for customers.
Myth #3: Cloud computing will cost more
While thinking about costs, there are many aspects to consider. There is the actual capital and operational expenses of hardware, virtual machines, software and staff to deploy, secure, upgrade and maintain IT equipment and services.
Another consideration is time. How much time does it take to deploy new services and products? What is the lead-time to purchase new equipment and services?
Finally, utilization is a consideration. Do you have to purchase extra capacity in advance to plan for future needs? Are resources being spent for underutilized equipment for the “just in case” or upgrade scenarios?
When you consider all these costs, the total cost of ownership is comparable, but with the added benefit of greater security and redundancy along with an improved end-user experience. Organizations also have the added benefit of being able to purchase capacity as and when they require, so capital investment is not locked in underutilized equipment.
Myth #4: Cloud service providers will have access to my data
Encrypting client data at rest and in transit ensures that there is no potential for cloud providers to access confidential information without an encryption key. In the end, the clients have the final say over who does and does not have access to their data.
Myth #5: Working in the cloud is complex
While the theory behind how the cloud works may be complex, the end-user experience is quite the opposite.
When it comes to setting up or migrating to the cloud, your service provider does all the heavy lifting in the back-end, which results in a seamless transition that limits downtime and creates the same, if not a better, experience as an on-premise environment.
Fact: Faster deployments and software upgrades
It is without a doubt that cloud deployments have made life easier for our customers. Initial implementations and software upgrades are much faster for Alessa customers in the cloud than those who opted for on-premise installation.
Internally, our decision to use Microsoft Azure has been a boon. Alessa developers are able to spend more time developing compliance and fraud prevention functionality rather than code for IT infrastructure and deployment code. This has translated to more integrations with other service providers and features that help our clients with their day-to-day operations.
Fact: Greater capacity for fraud detection and prevention
With the increased data storage and computing power offered the cloud, deploying AI-based techniques in Alessa becomes a reality for many more organizations.
In the case of Microsoft Azure, the platform offers advanced machine learning capabilities, which allows companies to quickly and easily build, train, and deploy machine-learning models.
Fact: Cloud Cuts Operational Costs
Accenture, a consulting firm that helps large organizations, has found that moving applications to the cloud delivers 10 to 20 percent reduction in operating costs compared to legacy technology.
They also find that the move to the cloud results in 30 to 50 percent reduction in time-to-market and 40 to 50 percent reduction in provisioning time.
This translates to greater customer experience as well as, the ability to introduce innovations that may introduce greater efficiencies.
Fact: More Banks are Planning to go to the Cloud
A market study by EY found that every UK bank executive they spoke to was exploring the use of public cloud. At the time of the survey, 80 percent of UK banks had migrated less than 10 percent of their business to the cloud and 27 percent planned to migrate 50 percent or more of the business in the next two years.
In Asia, an IDC study found that more than 40 percent of financial services institutions already are running applications in a multi-tenant public cloud. The study also found that close to 30 percent of the banks that were using a private cloud now plan to move a percentage of these to the public cloud.
Fact: Cloud Computing not just for Big Banks
Regional banks with their smaller budgets, can be constrained on their overall IT expenditure leading to aging systems, slower adoption of emerging and more effective technology, and continued use of manual processes.
The adoption of cloud technology allows smaller financial institutions to bring new revenue-generating products and services to market faster. It also increases productivity, allows banks to focus on introducing new financial services all the while reducing capital costs and the costs of managing IT infrastructure.
At Alessa, we have been helping our customers to migrate to the cloud so they can spend less time worrying about infrastructure to support their AML compliance and CCM systems. We invite you to learn more about how the cloud can help you, too.