2013 – An Inflection Point for Cloud Services in Financial Industry
It’s hard to believe December is already here; time to reflect on the technology highlights of this past year and prognosticate the year in review and see what exciting new trends 2013 holds for the financial industry. What will take center stage amongst all the IT predictions – ranging from Big Data developments, to Mobile Services, Virtualization, Social Media, Digital, or maybe their numerous permutations?
Cloud and “As-A-Service” appear to dominate the lists from Technology and Advisory Consultancy firms alike. But too often when everyone predicts what will be the hottest trend in the upcoming year, it’s a signal that it might have already hit the tipping point! It’s just a matter of where you are seeing it and understanding what to do about it.
For a number of years now, the financial services industry has been in a transition. Early in the decade, many large financial institutions had adopted monolithic enterprise applications to manage multiple lines of business. Then came a period of enhanced regulation with more stringent capital and risk management standards. In turn, these brought a corresponding increased strain on their traditional business models and operating margins. The traditional “build it and they will come” IT model and the 12-18 month project delivery cycle can no longer meet the fast changing business needs. Time to value, time to result and time to change are the ultimate business drivers. Today the business unit holds the checkbook and determines the priorities. They don’t care much about platforms. They just want the best solutions for the problem at hand that’s easy to buy, easy to use and easy to deploy.
As 2012 draws to a close, certain key priorities have emerged for the industry as whole, major themes among them are:
- Enhance customer relationship through seamlessness experiences and greater convenience
- Improve the use of analytics and real-time access to data and business intelligence
- Drive operational efficiencies through new channels and consumer-centric solutions
- Overhaul aging technology to reduce operating costs and existence of complex processes
For many business users, cloud-based services are synonymous to application service provider (ASP) model, outsourcing and hosted solutions as a method of technology consumption. In 2013, we will begin to see more and more companies using cloud solutions to tackle pressing challenges in data management, analytics, client communication and mobile delivery. Cloud adoption is going to accelerate and create better integration and workflow services for single and multiple distributed platforms, even with the heightened regulatory and security requirements.
2013 is the year that financial services clients will finally be ready to make the move to the cloud, but are their services providers ready? For financial technology companies, the growing expectations for well run and delivered cloud services will drive the agenda for 2013. We believe the long term success of those companies will heavily depend on their ability to move more quickly than their customers can on their own in building out a robust cloud infrastructure. It is not just about platforms, but enterprise-class operating capabilities, services offerings suitable for any size business and high standard security.
The recipe for success certainly holds true for one of the leading players in the industry – Eagle Investment Systems, a global data management, investment accounting, and performance measurement solution provider for the buy-side market. Its private cloud services, Eagle ACCESSSM, provides secure access to a fully integrated platform while minimizing the need for firms to purchase and maintain their own hardware and software.
At last week’s Eagle Analyst and Consultant Briefing session, I had the opportunity to chat with President and CEO John Lehner, as he shared Eagle’s strategy behind its thriving cloud services and plans to expand its growth trajectory. “We are in a time where buy-side firms demand cost efficient technology solutions that satisfy operational needs and deliver greater value to their clients.” John pointed out, “In response to market demand, we recognized that we need to further expand our product capabilities and support our commitment to provide the best solution and service offerings.”
It is that discerning industry foresight and client commitment that propelled Eagle to become one of the top financial software companies. Today, Eagle ACCESSSM accounts for 90% of its client growth. Through its alliance with EMC and VMware, they are bringing a new level of security, performance, reliability and global scale to the industry with their cloud-based solutions. 2012 was a year of transformation where Eagle successfully shifted mindshare from techno-centric IT environments to a services-oriented organization, and made significant stride in adopting ITIL® best practices, standardizing processes and unifying security, delivery and services into a single platform. “We are having another banner year,” said John Lehner, “We will continue to innovate and invest in our solutions to ensure our clients are securing streamlined operations for consistency, transparency and compliance. I believe our services strategy is a sustainable advantage for our future success.”
Yes, they are winning with cloud services while others are still playing catch-up. In 2013, Software-As-A-Service (SaaS) will take off and deliver greater value-added services from the cloud. Better, stronger and more secure cloud-based services will increasingly differentiate them in gaining trust; in financial industry, trust is the business.