Benefits and Challenges Of Multi-Cloud Solutions in The Financial Industry

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As various industrial sectors have steadily transitioned towards cloud services over the past several years, the finance industry has not been an exception. Though still slower than other industrial sectors, financial companies have increased their rate of transition to the cloud much more quickly than anticipated; by 2020, 36 percent of financial firms expect to use the cloud for more than half of their financial transactions.

To mitigate risk, however, most financial firms utilize the services of more than one cloud service provider during their cloud implementation; this is known as a multi-cloud strategy. With this strategy, the financial firms diversify their tools and applications among their chosen cloud service providers; no single cloud service provider performs all their financial services and transactions. Discussed below are some of the benefits and challenges of the multi-cloud strategy for financial firms as well as some tips in developing an optimal multi-cloud strategy.

Benefits of a Multi-Cloud Strategy

  • Redundancy: The use of multiple clouds enables financial companies to store multiple copies of mission-critical data and applications in more than one cloud storage location. This protects the companies from significant data loss following a disaster of any kind.
  • Flexibility: Financial companies are able to pick and choose the combination of tools and applications from the various cloud service providers that meet their business needs.
  • Vendor-lock-in: By using multiple clouds, companies are not subject to the whims of any single cloud service provider. Rather, the companies have leverage over the cloud service provider which can be used to negotiate better terms.
  • Cost savings: With a multi-cloud strategy, companies can comparison shop and negotiate for the best prices for the desired services; this can result in financial savings.

Drawbacks of a Multi-Cloud Strategy

By and large, the major constraint to a multi-cloud strategy is the issue of security. Some of the ways that security poses a challenge in a multi-cloud strategy include:

  • Threat analysis: An important component of cybersecurity is threat analysis; the network administrator monitors constantly for vulnerabilities to network infrastructure as well as malware. The use of multiple clouds introduces some degree of complexity to threat analysis such that some vulnerabilities may be missed thereby putting the entire infrastructure at risk of compromise.
  • Visibility: For optimal security, the network administrator should be able to easily see the free flow of data across the entire company network; as such, weaknesses and potential vulnerabilities can be seen and remedied. Visibility decreases when data travels between clouds from different cloud service providers; this makes it difficult to track the flow of data and assess the overall security of the network.
  • Security coordination: With each cloud service provider having its own security protocol, effective coordination is necessary to develop an overall comprehensive security policy for the financial company. This can pose a challenge because the cloud service providers may have protocols that are inconsistent with each other or with industry regulations.

Developing a Multi-Cloud Strategy

When deciding to implement a multi-cloud strategy, there is much to consider. Some questions that should be asked during this deliberative process include:

  • What cloud service providers have the services and tools that are best aligned with the company objectives?
  • How will access and security be managed across the various cloud service providers?
  • What level of support will be provided by the cloud service providers?

Due to the complexity involved in developing a multi-cloud strategy, it is advised to seek the services of a cloud service broker. Cloud service brokers are experts who are extremely knowledgeable about the various cloud service providers and will work with you to set up the best multi-cloud solution for your company.

At DoubleHorn, we are a cloud service broker that engages with major cloud service providers to ensure that financial companies are equipped with multi-cloud solutions tailored to their business needs. In addition, we have specialists well versed in developing security policies and strategies to keep multi-cloud networks secure and protected. Contact us today for more information about our services.