May 30 2019

The 5 Habits That Innovative Financial Services Firms Practice in the Cloud

Transformational financial sector companies are using the public cloud to create more value from data, optimize machine learning and provide better tools to business units.

Although it probably feels like a lifetime to most IT professionals, only a few years have passed since the mere thought of migrating resources to the public cloud was seen as bold, innovative and even a little daring.

Today, the cloud is largely seen as just another method of delivering IT resources, and the act of placing workloads with public cloud providers isn’t necessarily considered any more cutting-edge than investing in on-premises servers and storage appliances.

To set themselves apart, organizations need to do more than just push resources to the public cloud; they need to utilize the cloud in new and strategic ways that achieve business value beyond commonly cited benefits like increased scalability and flexibility. This is especially true in highly competitive industries such as financial services, where technology is seen as a differentiator and a business enabler — and where virtually all firms are trying to use cloud resources to give themselves an edge.

VIDEO: See what it takes to better manage workloads in the cloud.

Companies Approach Cloud Adoption in Different Ways

A recent white paper from Google Cloud divides financial services firms into three categories of cloud adopters: Infrastructure Optimizers that focus on migrating specific workloads to cut costs; Cautious Strategists that are beginning to take advantage of capabilities available only in the public cloud; and Transformative Innovators that fully utilize the flexibility and agility of the public cloud to attract top talent and build solutions that change their industry.  

In examining the Transformative Innovators, Google Cloud found that the most innovative financial services firms have these five habits in common:

  1. They learn from the tech industry. Technology companies build software more effectively than most organizations in other industries — not only due to a higher level of talent and expertise, but also because of practices that significantly reduce the time spent on code maintenance. These practices include continuous integration and continuous delivery (CI/CD), code reviews, unit and integration testing, incremental rollout, blameless post-mortems and others. Because these practices reduce the need for code maintenance, IT experts can continue to innovate instead of getting bogged down with support for existing applications.The most transformative financial services firms mimic these actions and attitudes, and often utilize cloud-native technologies to put them into practice effectively. 
  2. They embrace an “everyone’s a programmer” culture. By bringing line-of-business stakeholders into the process of building solutions, firms can create purpose-built tools that are more easily audited and tested than existing solutions (such as spreadsheets). Google Cloud points to one global asset management firm that is natively building new applications for funds distribution and marketing in the cloud, giving business users direct access to development tools and enabling a user-driven approach to software delivery.
  3. They use data openly, but securely. Regulations like the European Union’s General Data Protection Regulation are bringing compliance concerns to the forefront in the financial sector. Yet, financial services firms must also ensure that data is readily available when needed. Innovative organizations are using the public cloud to thread this needle — storing data in a manner that allows access to be easily granted or revoked, and leveraging cloud-based data security and monitoring services, such as advanced tools for data loss prevention, obfuscation, tokenization, encryption and logging.
  4. They adopt machine learning effectively. Innovative firms are adopting robust machine learning systems that integrate a number of components, including data collection and verification, analysis and process management tools, configuration, monitoring and server infrastructure. Additionally, they are implementing cloud-based tools that provide functionality such as model monitoring, error diagnosis and reporting. These solutions include HPE Bright Cluster Manager Machine Learning and others.
  5. They implement serverless applications. By embracing serverless applications in the cloud, transformative financial services firms are eliminating the management and support tasks associated with infrastructure like virtual machines and Hadoop. This, in turn, allows their IT professionals to focus on building new systems and learning from data as they improve time-to-market and project ROI.


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