While 52% of firms of asset management use the cloud for management of data even today. A further 28% plans on shifting towards the cloud for management of data in 18 months that are to come.
Financial institutions have recognized that the industry is at a point where the cloud is the only default option. Maximizing the benefits of cloud technology and adopting a model of managed services.
By moving to cloud, Institutions of Finance can decrease costs, increase their flexibility and further re-allocate resources to more strategic projects.
The cloud offers potential that is great for buying side companies and Finextra spoke to Eisen who is the global head of solution for the services of finance. The benefits of adopting a service model that is managed and outsourcing. Moreover, the cloud helps map be varied data sets that need to analyze for the insight
The cloud as only default option
Andrew Eisen highlighted that around five years back, that there was a skepticism that was generally about if the services provided by the financial business and other large companies with the sensitive data would be more comfortable outsourcing or using the infrastructure to the cloud platform.
Most of the firms, however, we have worked with have taken a strategy of cloud first strategy. In the boardrooms, It is not a discussion about whether they are shifting to the cloud or how fast it is. Moreover, how they will be dealing with capital expenses to operating expenses. Also the change in the skills and people. As said by Eisen.
The finding of the 52% of firms using the cloud for data management as of today, Eisen has predicted that the figure could increase to 80% by 2021’s end. The growth of the cloud is reflected on the market own client with more than 70% of the new clients selecting a service that is managed ver the traditional one with enterprise deployment of software.
Putting capabilities of the cloud into a native solution gives financial institutions the chance to grow in a way that is cost effective and that has not been available traditionally. Like with high performing computing. Where thousand or tens of machines can be used to run a calculation that is complex for completing a task. Then it is complete, the institutions of finance are able to turn it off and stop the spend that is being done.
According to Andrew, the cloud is not only changing the cost that is underlying but also the infrastructure available. It is also changing the login of the way instituitions of finance go on for solving a problem. The cloud has been an amazing innovation in the industry.
Outsourcing Differentiation of Cloud Data
The services that are managed often fill the gap that the new technology brings and changes the process while it frees up capital that is limited or the resources. This allows the financial instituitions to focus on their part of the business that differentiates from their competitors. Andrew Eisen also explored how outsourcing services of management have impacted the management of risks.
In the services of finances, new regulation and risks of regulatory on the instituitions are increasingly offering up parts of their companies to parties that are third parties to run their department for them. They must now explain how this has affected their profile of risk. Especially as traditionally, the consensus was that services in the house have risks reduced.
The cloud technology providers have grown and established credibility. And because they have such specialization, they have the ability to eliminate the risk in the cloud. Moreover, is better than the instituitions of finance that have on-premises.
However, a note on the moels of hybrid. Eisen says that this is a religious conversation almost. The model of hybrid is for those who don’t want one supplier to have control over their infrastructure.
In the end, however, it needs an increased cost of capital that will help the company allocate workloads across different providers of cloud and financial institutions will not be able to take full advantage of the feature, expertise, and functions that will be give to them.
This also tells that there is value in the infrastructure that is physical. Eisen has described that as an interim where the end goal is to get most of the models operating in the cloud, but the Institutions of finance are to these assets that are physical which are a noncurrent investment in the capital and software.
Truth’s single source of Cloud Data
While the Financial Instituitions opt for changes in the provision of the cloud. There is a source that is single of truth for the data that is operational. Especially when the machine learning models are concerned with. The management of data, as defined is for making sure that the data is in the process of operation. You have records of truth that are traceable through the governance of the lineage of the process of decision making. So in the audit, the best known data is there for the moment at that time. For that task only.
However, Eisen explains that with machine learning and analytics of the portfolio. The data has been bad and will also need to be considered. As this can affect the outcome of the positive of the model that is being built.
Management of Data of the concept of mastering the single source. The truth is for data of business or data that is operating. When you start getting theoretical potentials, you can have a version of the truth that is multiple.