Sungard Availability Services: Partnership is the path to the cloud – Keith Tilley
As banks are forced to bridge the gap between the latest technologies, such as cloud computing, and their legacy systems to optimise their services for the digital banking age, they must increasingly operate with a hybrid IT model. We speak to Keith Tilley, EVP of global sales and customer services management at IT services specialist Sungard Availability Services, about how to manage this model to maximum effect.
Banks have become accustomed to the increasing complexity of their IT architecture over the years, having continuously bolted-on many new elements around their legacy systems. Now, they are competing with new market entrants that are not encumbered by their legacy IT investments, and can start from scratch with cutting-edge technologies and the agility they bring. By turning to the cloud, however, long-established banks can keep up.
"As in all industries, the cloud gives banks the ability to look at how to deliver services to their customers faster," says Sungard Availability Services' (Sungard AS) EVP of global sales and customer services management Keith Tilley. "It is easy to provision and it allows 'burstability' - the ability to meet rapid spikes in demand as retailers have recently had to with Black Friday. It provides flexibility. It helps banks avoid what they are used to doing, which is building their own systems to reach maximum potential and then running them at a low level most of the time.
"Customers want everything immediately when it comes to products and services, and banks must look at people's experience of using the technology. The cloud is just a nice name for virtualised technology that has been mixed with the internet to enable it to do more things. Banks need to grasp it in the way retailers have."
Beyond the remit
Sungard AS has evolved in recent years to focus on more than its traditional heritage in business continuity and recovery. As a natural evolution of its services, the company now provides managed services, cloud services, data centres, networks and security services, IT consulting, applications and software. It operates 80 highly resilient facilities worldwide including 14 data centres in Europe and three cloud-enabled data centres inside the UK. What's more, its reputation for reliability is unmatched, as it has achieved 100% uptime in over 30 years of business.
Drawing on its experience across many industries, but including clients in financial services, the company has been able to amass the skills required to not only recognise the challenges of taking an enterprise in the cloud, but also provide the solutions.
"Going to the cloud is not easy. There is not one cloud that fits all. It is easy to find a cloud solution - it can be done online very quickly - but you have to remember that the biggest lie in the world is 'I have read all the terms and conditions', and banks are highly regulated so they can't just go online, tick the box and start putting customer data out there in the cloud. The hard part is getting the right cloud and putting the right applications out there. Using the cloud does not abdicate responsibility for processes and protocols," Tilley explains.
Taming the hybrid
The teaming up of legacy systems with cloud services presents the possibility of great complexity, but with a selective approach to choosing the right parts of the cloud to use there is also a great opportunity. The key is to understand which parts of an organisation's IT needs can benefit from the cloud and how, which means relying on the experience of experts who understand the cloud and the nature of their clients' business.
"Most CIOs understand that they are there to drive the business forward, but they are concerned about security and the value of the investment in legacy IT. Not every application needs to go through the cloud, so you have a hybrid IT or hybrid cloud model. One bank client of ours has put some of its consumer interfaces on to the cloud for its high-value customers because increasing competition meant it had to move quickly. That bank chose us because we understood its needs for security, availability and scalability," says Tilley.
"Banks can still run private clouds - we run many hosted private clouds so that our clients don't need to run their own data centres. They can benefit from the technology but have self-maintenance, self-management, scalability and the ability to grow capacity as needed. I do see banks also using the public cloud but much depends on what you put out there. Some clients do use Amazon or Microsoft Azure for public cloud services - but with a lot of oversight - because some applications can work on a shared public cloud," he adds.
The public cloud
There are many applications that can potentially reside successfully on the public cloud. A good example is development requirements where live data is not being used. Some front-end applications are also candidates if they target specific services such as allowing targeted customer segments to access and manage their accounts, as long as careful thought is given to the security capability of providers of public cloud services.
"You need security and you need the ability to audit, so accreditation is very important when choosing a public cloud service. The industry will use a mix of public cloud and hosted private cloud services. Security is one reason people look at this model, but performance is another. With the shared public cloud there is a possibility that a burst in activity for someone else will cause your performance to decrease," Tilley notes.
"A hosted private cloud is customisable so performance can be improved if necessary, and security provisions can be increased. Storage capacity and CPU power can also be raised if the client wants. In the banking and finance space, the public cloud is like an off-the-peg suit. Increasingly, clients want a tailored solution - though not a bespoke one - so it is possible to mix public and private cloud provision and link that back to legacy systems."
Private cloud services will, inevitably, come at a higher price because they can be customised in the way Tilley describes. That is not, however, a great disincentive these days. We are already long past the stage where the decision to enter the cloud was mainly driven by a need for cost savings. Just as business process outsourcing was once about cutting costs but soon came to be driven by the potential for greater agility and performance improvement, the use of the cloud has evolved along a similar path.
"Everyone rushed to the cloud at first from the point of view of cost but most of the time you get what you pay for. The real benefits are flexibility and speed. You will get far more of both compared with buying more hardware and going through the change controls required when doing it in house. Speed to market is an important weapon in the battles banks have to win these days," says Tilley.
"I would never advocate going to the cloud for cost reasons alone. It is about being available to customers because they want everything now. It is possible to change you insurer or your bank very quickly online now. So, banks and insurers must deliver services that match customer expectations, though they must also guarantee security and comply with industry regulations."
Partners in innovation
The flexibility the cloud provides is the perfect platform for innovation. Tilley cites the example of a client in the US that wants to link insurance premiums to the satnav system in a client's car. The result would be the ability to calculate premiums in a dynamic way based on where the car is driven.
"Some of that technology will be cloud-driven. The important thing for any financial services organisation to consider is what is right for them in terms of innovation, and how can that be delivered with the right security and flexibility in their cloud solution. That is why here, at Sungard AS, we want to understand our clients' business outcomes so that we can tailor their cloud solutions. We want to understand what their business needs. That is all we do. We have always been in the availability services business," Tilley explains.
"Furthermore, we are independent and we deliver an outcome around a service level agreement. It is not about using a particular technology vendor - we will move services around to suit what our clients need in terms of hardware. One financial services customer that signed up for a ten-year deal has renewed for another seven years, so we must be getting the partnership part right. Our goal is to not only meet our clients' short-term goals, but also develop a long-term relationship that helps clients meet their mission-critical IT needs and ensure their cloud journey is the right one for them."