3 Critical Steps to Business Continuity and Availability in Financial Services

Financial services firms have transformed their businesses to align

with the digital lives of their constituents, putting a big premium on

Availability and business continuity to meet customers’ increasing

demands.

Sponsored byVeeam Software

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Chapter 1: Enriching Customers’ Digital Lives in Financial Services

Business customers are seeking easier ways to work with banks, insurers, credit unions and investment firms, while clamoring for approaches to consolidate their financial services vendors. Consumers want greater flexibility and more choices in how, when and where they do everything from paying bills and checking on their 401(k) balances to applying for a mortgage. Regulatory mandates are more numerous, precise and demanding.

The individuals who make up these financial services constituencies have adopted “digital lives” where technologies such as mobile devices, lightning-fast Wi-Fi and cloud services make it easier to accomplish their professional and personal goals. And this has meant that financial services firms have had to support the digital lives of their customers and their employees at every step along the way.

Digital lives in financial services are heavily shaped by the many different forms and formats of data. In fact, financial services executives consider data to be the “fourth pillar”—along with people, processes and technology—required for success. Research indicates that 83% of financial services firms say data is their most valuable strategic asset.1

In the financial services industry, a digital life has a unique quality, depending on the needs of each person in the financial services ecosystem. For instance:

• Loan officers need instant, reliable access to a wide range of information for both commercial and consumer lending—such as assets, liabilities and past loan histories—to accomplish their key goals. These goals include validating credit worthiness and reducing fraud, as well as speeding time to approval.

• Insurance agents want to respond quickly to customers who need a fast quote on a new premium, or who need immediate repair approval after a homeowner’s claim or a car accident.

• Bond traders need the most up-to-date pricing information on municipal securities to determine the precise moment to buy and sell for maximum profit.

1 “The Science of Winning in Financial Services,” Ernst & Young, 2016

Chapter 1: Enriching

Customers’

Digital Lives

in Financial

Services

Chapter 2: How Business

Continuity Fulfills

Digital Lives

in Financial

Services

Chapter 3: Ensuring

Availability in

Financial Services

Chapter 4: Three Steps

to Business

Continuity and

Availability in

Financial Services

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• Data scientists rely on access to a wide range of data to conduct analytics on everything from loan default causes to the financial benefits of investing in faster bandwidth for high-frequency trading.

• Mobile-centric millennials demand the convenience of banking anywhere, anytime—whether it’s running out to the ATM for cash before a trip or paying a utility bill during halftime.

In each of these cases, digital lives are profoundly influenced by changing customer behavior to take care of business in the manner that is most convenient for them, not during the traditional 9 a.m. to 5 p.m. workday at a physical office.

And, of course, business employees and consumers are all engaging with financial services in omnichannel interactions. Business is no longer conducted only at a desk in a brick-and-mortar facility; it’s also conducted over the internet, through a smartphone and within a customized mobile portal accessed by multiple devices.

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Chapter 2: How Business Continuity Fulfills Digital Lives in Financial Services

The mandate to align with customers’ digital lives has coincided with a muddying of those firms’ competitive positions. No longer do banks only worry about how they stack up against other banks; in fact, all financial services firms see themselves in each other’s spaces and feel an intense pressure to continue to differentiate themselves by fulfilling the entire spectrum of their customers’ digital lives.

When businesses and consumers rely so heavily on anytime, anywhere access to their financial data and services, firms must pay heed to proper business continuity safeguards. For example, a four-hour outage at Amazon Web Services’ S3 cloud storage service cost U.S. financial services firms a whopping $160 million.2 Consider the impact on the digital life of consumers who can’t pay their bills or access funds from an ATM because of downtime at their financial institution, or a local retailer that can’t receive electronic authorizations for customer purchases.

This raises the stakes for financial services firms to have a well-thought-out strategy for business continuity—one that goes beyond modernizing in-house compute, storage and networking infrastructure. That business continuity plan must be built around a no-downtime principle, with critical applications and infrastructure protected and secured against physical failure and cyberattacks.

The plan also must put Availability at its core, to ensure that all data and applications are available in an uninterrupted manner on a 24/7 year-round basis. Whether your financial institution does business around the globe or around the corner, this is paramount.

2 “$310m AWS S3-izure: Why everyone put their eggs in one region,” The Register, Mar. 2017

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Chapter 3: Ensuring Availability in Financial Services

Any disconnect between what customers want and what financial services firms provide represents an “Availability Gap.” And that Availability Gap can result in unmet customer expectations, a diminished customer experience and even lost business.

These constituents’ digital lives are interrupted, diminished or dangerously impacted by this Availability Gap. The source of the threat to Availability can range from a simple cut network cable or a misconfigured server to an insidious ransomware attack like the recent WannaCry episode.

This Availability Gap is real and potentially catastrophic for financial services firms. The 2017 Veeam Availability Report points out that half of organizations believe that Availability challenges led to loss of customer confidence, a negative impact on brand integrity, a reduced stock price and eventual revocation of licenses/accreditations.3

The broadening regulatory footprint alone makes closing the Availability Gap essential. The Sarbanes-Oxley Act, the USA Patriot Act, the Gramm-Leach-Bliley Act and many others are the tip of the iceberg when it comes to how financial services firms protect client data.

Other factors that make surmounting the Availability Gap mandatory include the globalized nature of today’s financial services landscape and changing consumer behavior in financial transactions. Consider, for instance, millennials’ demonstrable preference for electronic debit card payments in lieu of cash. Think about the impact on a consumer’s digital life if he or she can’t purchase goods at stores because of an Availability problem. And, of course, merchants suffer a loss in revenue and profits—not to mention shoppers’ confidence—when Availability Gaps occur.

Any service interruption, or any disconnect in the availability of services or access to vital information, has a dramatic ripple effect from the customer back to the firm. Customers—businesses and consumers alike—have come to expect that financial services are, in fact, Always-On Enterprises.™

3 “Why Organizations Still Struggle To Digitally Transform and Innovate,” 2017 Veeam Availability Report, Enterprise Strategy Group and Veeam,2017

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Chapter 4: Three Steps to Business Continuity and Availability in Financial Services

As discussed, an Availability Gap is particularly destructive to digital life in financial services in terms of loss of revenue, profit and customer confidence, as well as hindered consumer flexibility and convenience. Every system, application and activity is reliant on the Availability of the underlying technology.

There are, however, steps IT decision-makers can take to close their Availability Gaps. The first step, as previously mentioned, is to create and follow a viable business continuity plan. Secondly, IT leaders should invest in Availability solutions that have been designed to address the business continuity challenges of today’s highly virtualized and cloud-enabled financial services environments.

Availability software is critical to maintaining and preserving digital life in financial services. But not all Availability solutions deliver the same level of functionality, reliability and performance. In evaluating potential Availability solutions for financial services, IT decision-makers should focus on three critical areas. These are:

1. Ensure continuity and availability

• Optimized backup and recovery strategy: Every bank, insurer, investment firm and brokerage service should follow the 3-2-1 best-practices guideline for data protection, which is:

• Maintain at least three copies of your data.

• Store data on at least two different types of storage media.

• Keep one copy of the backups in an off-site location.

• Ensured data loss avoidance: Your Availability solution should enable you to achieve major improvements in recovery point and recovery time objectives (RTPO™) of less than 15 minutes for all applications and data.

• Off-site backup and recovery: Financial services organizations need the flexibility to leverage cloud backup and replication as part of their 3-2-1 data protection strategy.

• Fast recovery of the entire machine or application-level recovery: Verifiable recovery of every file, application and virtual server, every time, is a must-have.

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2. Enable analytics and visibility

• Visibility and real-time monitoring and reporting for your virtual environments: This will not only help to meet compliance requirements, but also will help financial services organizations anticipate and address potential problems before they affect operations. In the compliance-laden financial services industry, this is a potentially critical point of failure that must be bolstered.

• End-to-end visibility for both physical and virtual machines: This will help prevent possible failures of any type of application or system.

• Creation of incidents based on events that happen in your environment: Financial services environments are subject to strict regulations for data protection and other sensitive areas, so having a clear picture of events can save a lot of time and money in meeting compliance requirements.

3. Achieve digital transformation agility

• Pre-production testing of applications and application upgrades: One of the challenges in meeting the digital life demands in financial services is addressing “IT consumerization.” The concept is that all users are consumers of technology in their personal lives, and they bring those same expectations with them whenever they pay a bill, initiate a loan request or research retirement plans. This means applications must be delivered quickly and bug free. By using a solution that features an on-demand sandbox to test applications, IT teams can cost-effectively accelerate development and improve quality assurance.

• Cloud-based data management: Public cloud is an increasingly valuable aspect of digital life in financial services—even large providers frequently supplement traditional on-premises infrastructure and private clouds with affordable, flexible public cloud services. By leveraging public cloud services such as Microsoft Azure, IT teams can support DevOps teams and other lines of business with the infrastructure they need without having to go through lengthy procurement and deployment processes.

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• Workload mobility: The complex infrastructure of an enterprise involves physical and virtual machines, as well as private, public or hybrid cloud. To achieve an optimal setup, financial services organizations need the right data management and Availability solution can provide a certain degree of flexibility, to manage and migrate data easily.

• Flexible, simple and cost-efficient deployment options: With the right Availability solution, financial services organizations should be able to manage, migrate and restore their data across a physical, virtual and cloud-based IT infrastructure without complex configurations or additional hardware investments, thus minimizing operational costs.

Conclusion

In today’s financial services markets, IT decision-makers have an important obligation to meet the digital life requirements of all their constituencies—from brokers and bankers to insurance agents and digitally inclined consumers. All of these constituents want to conduct financial transactions easily, quickly and reliably.

To meet these obligations, IT leaders must focus on business continuity and closing any Availability Gaps. With the right solutions in place, IT teams can ensure continuity and Availability, while also meeting compliance requirements, extending visibility, and leveraging workload mobility and cloud data management.

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Copyright © Veeam 2017 | Veeam.comJune 2017

Not all Availability solutions are the same. For more information on how to implement a holistic backup, recovery and Availability solution, please visit Veeam at www.veeam.com/financial-services