Organizations have still not unlocked the full potential of cloud computing to help them gain cost efficiencies, greater agility and better serve customers. We look at how to improve cloud strategies in four key areas including establishing an adoption office and increasing visibility into cloud services and spending.

Public cloud adoption continues to grow, with organizations increasingly relying on cloud infrastructure for their operations. The 2024 ‘State of the Cloud Report’ observes a slight increase in multi-cloud adoption from 87% in 2023 to 89% in 2024, and it remains the dominant strategy for most organizations.¹ Despite these trends, the financial services industry has been slow to invest in and optimize cloud computing practices.

This could be about to change. For example, taking inspiration from their smaller challenger bank competitors, larger banks are pledging millions of dollars to improve their technology and enhance their cloud footprint with four main goals: 

• Cost efficiency & scalability. Organizations can reduce capital expenditure, as instead of purchasing their own hardware they can use the pay-as-you-go model offered by CSPs to scale resources up or down as required. 
  
• Agility & innovation. Cloud computing fosters agility in developing and deploying new products and services for customers at an accelerated pace, while managed services within the cloud environment can help to automate routine tasks.
  
• Enhanced security. Financial institutions, historically reliant on on-premises infrastructure to maintain data control through advanced encryption and compliance, are overcoming initial concerns about data privacy and regulations and increasingly see the cloud as a way to improve security.
  
• Data analytics. Advanced tools facilitated by cloud computing are helping banks to harness vast amounts of data to improve services for customers and to better anticipate future trends, including through the deployment of Cloud Native AI.
  

All of these goals are underpinned by one key ambition – improving the customer offer and experience. New generations of customer do not have the same loyalty that previous generations exhibited. They are increasingly willing to switch to a provider that can offer new digital products and features that better suit their lifestyle in an ever-changing, technologically advancing world.²

For example, insurance providers are now developing applications that allow the user to make changes to their policy at the press of a button, instead of sifting through endless browser pages or waiting to speak to an adviser on the phone. Cloud computing can enable organizations across financial services to develop this kind of customer-friendly app – and the operational processes that support it – more quickly and efficiently. 

However, optimizing cloud computing has many challenges including how to migrate critical workloads and core systems, how to adopt and leverage cloud-native technologies including microservices and containers, developing the right multi-cloud strategy,³ and making sure the end results really do improve customer experience and satisfaction.

WHAT CAN ORGANIZATIONS DO TO MAXIMIZE VALUE FROM CLOUD ADOPTION?

The key challenges associated with optimizing cloud adoption can seem daunting for enterprises to consider amid current economic uncertainties. IT executives are concerned about how any transition to the cloud might impact their IT strategy and are keen to avoid surprise bills. Overspending in the cloud is a common problem.  

Drawing upon our experience of expediting cloud adoption, we think attention should focus on four key areas:

• Strategy review. Enterprises need to understand their growth objectives at the business level. Only then can they understand how to align their cloud strategy and risk appetite to serve the organization to the full potential. An extensive ‘discovery phase’ exercise can assist by offering a thorough assessment of the organization’s cloud program maturity and architecture, pinpointing areas that require attention, and formulating strategies to optimize performance.
  
• Establish an adoption office. Implementing strategic governing bodies such as a Cloud Centre of Excellence (CCoE) and adoption office can help to enforce standardized and effective cloud procedures, practices and frameworks. The goal of these governing bodies is to disseminate best practice and to ensure that workloads are deployed efficiently, in line with the organization’s governance policies.
  
• Advance modern ways of working. People in large financial organizations are often apprehensive about the cloud and the newest technologies, and may end up with cloud strategies that are overly cautious or excessively ambitious. This can be countered by education on the significant benefits of successful cloud deployment – for example, how adopting cloud-native technologies can help prevent technology-driven processes from becoming outdated – and on how cloud-adoption can be risk managed. The aim should be to promote a cloud-first mentality and education, from enhancing cloud expertise to streamlining engineering practices. 
  
• Measure what matters. Leveraging centralized tooling empowers organizations to effectively monitor their Objectives & Key Results (OKRs), as well as the health and cost of their cloud environments. Emerging FinOps practices can help organizations to gain visibility into their cloud services and spending, helping to counter the complexity often introduced by multi-cloud environments. An example of this is cost allocation tagging, where each cloud resource is tagged with relevant metadata (e.g. project, team, business unit). This enables granular reporting and forecasting for specific use cases or projects, enhancing cost transparency and accountability.
  

While financial organizations are already making efforts in some of these areas, there remains significant room for improvement given the rapid evolution of cloud services, business needs, and customer expectations.

This in turn begs the question: What’s coming next for cloud computing? It’s no surprise that many experts are forecasting more investment in cloud-native AI, where companies can deploy, run and scale AI models on cloud infrastructure. The big banking players are already investing in this area to help manage the automation of workloads and also to gain customer insights. Increasingly, business users will have access to AI-driven guidance, insights and resolutions through user-friendly interfaces, allowing them to diagnose and resolve problems on their own.

Contact us today to accelerate your cloud journey, simplify complexity, and transform your cloud adoption success story.




REFERENCES

¹ https://info.flexera.com/CM-REPORT-State-of-the-Cloud 
² https://www.weforum.org/agenda/2023/11/gen-z-banking-finance-money-trends/
³ https://www.capco.com/intelligence/capco-intelligence/multi-cloud-and-the-specter-of-spaghetti-architecture