By Brian Murray , Head of Service Development at IT change specialists ECS
The UK financial services sector is in a state of flux. What with the uncertainties around Brexit, a complex and shape-shifting regulatory environment, and the sheer number of challenger banks entering the market, agility is moving to the top of the financial services IT agenda.
For agility read cloud.
While banks such as Metro Bank have embraced the cloud, the incumbents have historically focused largely on control and cost savings rather than agility. This is because changing operating models is a huge undertaking. It involves making changes that go far beyond changing/adding suppliers, or technology platforms; it’s also about effecting cultural change and establishing a new way of working.
Despite the challenges, changes are afoot. A growing number of large financial services firms with legacy estates are starting to make headway in the cloud, and prioritising cloud service supply for new solutions.
Agreeing on the right cloud strategy can be complicated, and is usually about transformation rather than migration. A laser-like focus on the business case should clarify the key strategic goal of the business be it:
- technical agility, to support more rapid provision and change;
- commercial agility, from a more modular pay-per-use model; and/or
- reducing the costs from in-house technology hosting.
Here are some recommended steps that can help businesses with legacy systems manage migration as part of their cloud journey:
- Choose the right partner(s)
Recognise that comprehensive cloud adoption will take quite a long time to complete, and a cloud supplier’s preferred approach may not be most aligned to your interests. Also, there will be many solutions that turn out to be better suited to more traditional hosting services, so take the time to select the most effective hosting partner(s) as this will never be wasted effort.
- Undertake a thorough application and service portfolio analysis
This process allows you to identify the application services that are the most promising candidates for software-as-a-service (SaaS). It also helps you to:
- accelerate discussions with business users around what changes will happen when;
- root out applications that are ripe for decommissioning, which in turn leads to infrastructure consolidation and cost savings; and
- ensure rapid business-benefit realisation.
- Clarify the interactions between application services.
This is easily overlooked but is vital from a security, performance and availability perspective. The required information can be gathered from the portfolio analysis.
- Assess the underlying platforms as potential candidates for platform-as-a-service (PaaS).
Check the application dependencies so that you know which applications will be impacted by which platform (e.g. databases, middleware, storage, messaging, web services). PaaS migrations, like SaaS (software as a service) migrations, will help to reduce the infrastructure migration requirements and will help on the decommissioning of outdated IT infrastructure too.
- Assess the remaining infrastructure.
Assess the remaining infrastructure to determine what needs to be decommissioned, refreshed, consolidated or migrated directly to either hosting or infrastructure-as-a-service (IaaS) offerings. The migration will be clearer using this approach, and the return on investment will kick in faster.
- Initiate preparatory work streams before migration.
Carrying out extensive IT change can require a factory-enabled approach, with structured functions established to manage the factory throughputs, align with the existing project portfolio and support knowledge-enabled decisions around each component to be changed. The most effective solution designs should be templated in advance, not only in terms of technologies, but also in operating models.
The points above focus on the service migrations, but effective cloud adoption measures will ensure migration success. A cloud-ready operating model will ensure an effective service integration and management (SIAM) function; with end-to-end capacity planning, service level management and support practices across all supply chains.
Perhaps most importantly, the operating model will facilitate people change, through all required restructures and skills development required for a successful cloud journey.
- Ensure the migration framework covers business change adoption.
Regardless of the target state, an IT function can too readily view the end result as simply technology change. Technology changes require testing, but process changes may need more careful assessment, as well as business involvement, to support buy-in and ensure the new solutions are successfully adopted and supported.
Baseline measures will be needed before any initial improvements can be recognised, as well as regular reviews across the cloud supply chain.
In summary, laying the right foundations for a more agile future in the cloud involves careful planning and preparation. Done correctly, the result will be a reduction in internal IT costs, and the ability for in-house IT to evolve from a technical support function to a full-blown business information management service that better supports business goals.
The result is a more nimble business that can move faster to gain a competitive edge. Which is why the smart money is banking on the cloud.