As the cloud more frequently makes its way into discussion, clients are not shy to raise questions about security. Despite increased adoption of cloud across the highly regulated investment management industry, this deeper questioning shouldn't be surprising as many have long been accustomed to onsite installation and have a fiduciary duty to their own clients.
The benefits of the cloud are hard to ignore. The cloud provides the opportunity to enhance solutions for the investment management community without having to rebuild core system infrastructures. It allows for more direct, anytime-anywhere access and flexibility in onboarding, deployment, and scalability. The cloud can reduce investment costs in space and money for onsite infrastructure. In short, there are potentially enormous benefits to be realized from cloud solutions as they are by nature agile and we can expect to see them evolve over time with the rapidly changing market demands for investment management firms.
We certainly understand when our clients question how secure it can really be. If you're considering a cloud solution but aren't convinced quite yet, be sure to talk to your provider about the following three things:
1. Cloud security regulation
The investment industry's relatively slow adoption of cloud services can in part be explained by concerns about compliance with regulations requiring the protection of confidential client data.
Why? Regulation and security standards are still evolving when it comes to the cloud because technologies are being developed much faster than legislative bodies can regulate. The cloud and our businesses transcend jurisdictional boundaries, but cloud services providers need to be able to adapt to the regulatory requirements of any jurisdiction.
2. The safety of security
Generally accepted practices in cloud security and reliability have begun to form. Cloud data center providers are taking countless tangible measures to assure data safety like surveillance cameras, limited onsite personnel, and strict authentication. Similarly, your solutions provider should be adding its own layers of security, such as hard isolation, secure sockets layer (SSL) communication, and more.
3. Private versus public cloud
Many firms hear the words public and private in conversations about the cloud and automatically assume private is better. In the public cloud, multiple users access computing services and data via the internet. As a result, you would notice that the sharing of resources and infrastructures enables efficiencies not otherwise possible in the private cloud setup. There are benefits and drawbacks to both public and private clouds. To learn more, talk to your solutions provider about the public, private, and hybrid options available to you.
Cloud computing will likely become more mainstream for the investment management industry before we know it. The aura of novelty will eventually fade, so now is the time to ask the right questions about security.Todd is EVP and CTO at Advent Software. He sets the company's long-term technology and solution vision. It's his job to make sure our solutions incorporate the best technology innovations to meet our clients' needs and are easy to adopt, own and use. Before taking ... View Full Bio