Analyzing Industries Part 1: Banking, Financial Services & Insurance

When we examine how technology is deployed in the field, there are a multitude of ways in which we can slice the market to give depth and greater understanding of the bespoke challenges that are faced in a given segment. For example, we could look at the market through the lens of a workload, where we see vast differences between the varying types of use cases such as Oracle database environments versus SAP, VDI or even HPC.  Additionally, we could look at varying geographies around the world and examine the differences between developed and developing economies, where the cost of labour influences the types of technology used.

In this blog post and subsequent posts, I will look at technology through an industry prism beginning with banking, financial services and insurance (BFSI) companies. To set the scene, I will examine the disruption BFSI firms will face in coming years.

I’ll then move to the technology challenges being faced, starting with the data centre and finishing with the VCE perspective and answering the question of how VCE supports financial institutions in creating a foundation for IT and business transformation.

What will be the game changer for financial services industry in the year ahead?

2014 continues a fundamental shift for the financial services industry as their customers, big and small, have more financial negotiation power due to alternative sources of capital from new technologies. Information intersected with analytics – often referred to as big data – when combined with cutting edge platforms, can bring together investors and borrowers in ways that bypass the traditional model where borrowers seek out banks. Instead, it becomes possible for savvy lenders to identify prime borrower prospects before the prospects even start a search for a lender. Together, big data and new platforms are launching a surgical strike at the very heart of the traditional financing model.

This, coupled with radical simplifications of traditional end-to-end business process and flow, will disrupt the sector, creating opportunity for some, but crisis for others. Disruption brought about by the changing dynamic with partner organisations and customers will be further characterized by the introduction of technology mash-ups, providing outcomes such as a broad uptake of digital wallets, payment disruption and more.

These companies are facing a harsh reality – banking is essential to a modern economy, banks are not. The same can be said for insurance companies.

How can financial services organisations keep pace with the challenge of running their data centres?

I don’t think keeping pace and merely running a data centre is good enough for a competitive and innovative financial services organisation. A successful company needs to be ahead of the demand and predict how technology will impact the very heart of their environments; the data centre. Today our data centres are under more strain than ever as they groan under the weight of the third wave of computing.

The amount of devices connecting to our networks is exploding, not just internally, but also for BFSI customers. This will only continue its inexorable expansion with new connected devices and mobile wearables, such as Smart TVs and Google Glass. These devices surf a tsunami of information as the Internet of Things feeds the digital universe. Compounding the challenge is the pressure of making sense of this deluge through increasingly sophisticated analytics methods.

To keep ahead, not just keep up, organisations should look to platforms that will serve the needs of the modern data centre by reducing complexity, increasing availability and, more importantly, creating an infrastructure that enables rapid service deployment.

Platform strategies should be forward-looking to underpin the shift in the way we manage infrastructure and reduce the amount of time spent on configuring systems, instead of spending more time on applications and workloads.

How does VCE support financial institutions in creating a foundation for IT and business transformation?

At VCE, we have done the complicated work of invention and innovation on the infrastructure layer, enabling BFSI customers to redirect their focus away from the challenges faced in the modern data centre – integration, provisioning and maintenance. Vblock Systems don’t just converge the compute, network and storage fabrics, but the management layer too. This approach frees up BFSI resources to channel innovation, providing customers with a higher ROI as well as allowing the technical staff to focus on business-oriented, outcome-oriented IT, instead of non-strategic, silo-bound configuration activities.

In the case of the financial services sector, VCE Vblock Systems have been successful in use cases ranging from PCI compliance to large scale VDI to allowing rapid provisioning of services for insurance companies to online banking and credit card rewards processing. Vblock Systems add hygiene and consistency to financial services environments and provide a stable, reliable, repeatable and highly scalable platform upon which customers can confidently hold their most mission-critical and business critical workloads and applications.

About the Author: Matt Oostveen