Asset management firms working on cloud-computing initiatives are tackling cultural challenges as much as data security and operational issues, according to executives from Northern Trust, T. Rowe Price and Vanguard Groupwho spoke at Wall Street & Technology’s Capital Markets Cloud Symposium earlier this week.
Though there is a lot of advertising and publicity about cloud computing and more business units are asking for it, in reality, the migration to cloud computing is a journey that involved constant communication with the IT organization and operations managers. “Saving money is interesting but getting people to appreciate standardization and the ability to deploy quickly kind of bumps up against the cultural aspects,” says Peter Magrini, EVP and CIO at Chicago-based Northern Trust.
Cloud computing is attractive with its promise of “delivering scale on demand or capacity on demand,” said Magrini, but the challenge is delivering the level of service that is demanded in financial services, he added.
While the benefits of tapping underutilized compute resources can lead to big cost savings, executives also cited speed-to-market and standardization as important motivators for the IT organization. “It was time-to-market. We were getting overrun for demands for servers and it was the recession,” says Peter Daniels, VP at T. Rowe Price, who spoke on the panel. The firm had a 300-to-1 server to staff ratio and it was hard to sustain it, he said.
While none of the firms are comfortable storing their data on the public cloud, they are indeed building private clouds for non-mission critical functions.
Security is still a concern since financial services companies are responsible for delivering services to their clients and any breech of data is a reputational risk. Among the challenges is “Getting people to understand it’s not the vendor’s neck on the line with the private cloud. It’s ours,” said Magrini.