How can banks and financial services enable a faster, more purpose-driven cloud adoption? What are the secrets to success and the potential pitfalls? A hint: don’t just move existing processes to a new platform.
The financial services industry has been notably tentative in moving to the public cloud. Only approximately 30–40 percent of banks’ current workloads are in the public cloud. What’s hampering progress then?
Challenges for heavily-regulated companies
As banks move beyond legacy IT systems to modernize their platforms, they deal with a myriad of challenges. This is a well-known matter to Contino, part of Cognizant consulting, which has executed over 300 transformation projects with over 150 of the world’s largest companies.
Any common obstacles? Well, regulations almost are used as an excuse not to transform:
“What I see are companies moving heritage on-prem controls into a cloud-based way of working, an approach where they may end up with the worst of two worlds”, says Ben Hicks, Transformation Director at Contino. “Yes, you have to obey the same rules when in cloud, but it’s up to the organization to re-assess, interpret and meet them in a way that doesn’t hinder innovation”.
Engineering and business should do it together
This approach links into another common problem: the existing federated view on particular areas such as risk and security. When processes are transferred to the cloud, who is to look after what? All this insecurity creates fear and mistrust.
How do you make an organization, comfortable in the on-premise structure, transform then? Start by combating the disconnection between engineering teams and business people. Both competencies are very much needed when embarking on a cloud journey.
“I’ve seen a lot of great engineers on the ground that lack the business perspective,” says Ben Hicks. “The merging of these two sides has never been more important, as well as ensuring buy-in from the top level; everyone needs to get involved in the cloud journey”.
Organizational and cultural change required
Contino normally gets called in when the organization hits a specific problem. That problem rarely has anything to do with technology. Rather, problems are sprung from a mixture of engineering culture and organizational structure.
Ben and his team have worked with several retail banks, where challenging paradigms, focusing on outcomes and building confidence are key ingredients to accelerate cloud transformation. Among the clients is one of the UK’s largest retail banks.
“Pushing back on existing traditions is important,” says Ben Hicks. “However, you can’t just hire a partner to fix that, you have to change as an organization. Our job is to show what is possible, step by step. To this specific client, we started and proved value with a small cloud-based app and have moved on to a large heritage migration journey”.
Get started – and have a sustainable approach
Any final advice to other companies?
“Get started ASAP (the analyze phase tends to go on forever) and learn to fail fast and often,” says Ben Hicks. “Also, if you are serious about a major transformation, don’t run it from a program. Make sure your vehicle for funding transformation is sustainable and continuous because it will be needed”.
To learn more, please visit Cognizant’s cloud section.