Reaching for the cloud: the potential and the reality of using cloud-based platforms Speaker: Michael Michaelides October 22, 2015
Within today s financial services (FS) marketplace, speed to market, agility and economies of scale in conjunction with world-class customer experience are all being mandated by existing customers FS today Customers In control, working capital advisory, innovation, informed, hyper-efficient, super personalized, global reach Competitors Nontraditional, consolidation, faster, innovative, customer focused Regulators Increasing pressure, BSA/AML, SEPA, BASEL III, currency controls Savings Payments/ FX Retirement Mortgages Loans Insurance Channels Omni channel, shifting branch/paper and electronic usage, customer immediacy, STP workflow End-to-end simplicity Supply chain, finance, innovation, loan securitization, scalability, OCR, big data Ubiquitous connection Responsive design, touch, self-service, location proximity, BI, cloud, mobile, shared service COE Page 2
fast-secure mobile smarter-data The rise of financial technology disrupters and the disintermediation of profitable value chains have caused FS organizations to fundamentally re-examine their business purpose Competitive advantage in an era of pre-emptive disruption purpose-built Advanced customizable friendliest pioneering frictionless-data consistent-experience Customer instant-value modular-structure Data-driven painless continuous-destruction Easy integration Efficient easily-configured API real-time Fast Page 3
Increasingly, FS organizations are examining the potential and the reality of using internal and external cloud-based platforms to serve their customers, employees and partners alike Future in the cloud: The future is now Point of entry Traditional technology Minority adoption Hybrid IT Cloud Majority adoption Unique business platforms that may never move to cloud Most FS organizations are at this point in the adoption curve. Many implemented virtualization with aspects of orchestration, but have not gone as far as self-service and full automation. Page 4
To build further confidence in the cloud, the cloud ecosystem needs to be secure, trusted and audit-ready Secure A secure cloud environment has the appropriate controls to protect the confidentiality, availability and integrity of the systems and data that reside in the cloud. Appropriate procedural and technical protections are in place to protect data at rest, in transit and in use. Confidence in a cloud ecosystem Trusted A trusted cloud environment is designed to stand the test of time. It should demonstrably provide high availability and resilience to adverse events. Audit-ready STAR An audit-ready cloud environment has continuous compliance and is certified to meet specific industry regulations and legislation. Appropriate procedural and technical protection is in place and documented, and compliance can be verified. Page 5
Organization Technology Data Operations Audit and compliance Governance To achieve a better level of confidence and increase cloud adoption, there are six domains of focus Focus areas for achieving confidence in cloud adoption EY cloud trust model By focusing on these Cloud control domains Objectives We aspire to be Secure Trusted Audit-ready 1 2 3 4 5 6 Page 6
Resolving roadblocks to full cloud adoption requires more than just technology changes Evolving from legacy to digital enterprise: breaking down the monolith Governance Keep on track to get to outcomes and goals while managing technical debt, especially where speed of change is increasing Enterprise-level architecture Bring structure to link strategy to outcome to better manage stakeholders and dependencies Extend holistic approach to governance beyond portfolio and program Focus on the right approach and tools for the right job Platform modernization Break down problem into work packages for appropriate speed and delivery style target. Proactively identify and factor into planning the change impact for different areas and speed to adopt Emphasize business in delivery and integrate methods and tooling across delivery styles for continuous integration/ continuous delivery (DevOps) Identify cultural and external impacts that cannot immediately take on a faster pace of change Delivery Change enablement and operations Page 7
To address these legacy challenges and modernize, leading firms are turning to next generation cloud practices and architecture principles, such as those enabling microservices Microservices vs. traditional service oriented architecture (SOA) Dumb end points Smart end points Services Microservice DB ESB Microservice DB DB Services Microservice DB Traditional SOA Smart pipelines Microservices Dumb pipelines 1. Code base: Use one code base for each microservice Microservices development guiding principles 7. Port binding: Export services via port binding 2. Dependencies: Explicitly declare and isolate dependencies 3. Configuration: Store configurations in the environment 4. Backing services: Treat backing services as attached resources 5. Build release run: Strictly separate build and run 6. Processes: Execute the application as one or more stateless processes 8. Concurrency: Scale out via the process model 9. Disposability: Maximize robustness with fast start-up and graceful shutdown 10. Dev/prod parity: Keep environments similar 11. Logs: Treat logs as event streams 12. Administration processes: Run administration tasks as one-off processes Page 8 (Source: Pivotal 12factor.net)
To take advantage of the agility afforded by a cloud and service based architecture, FS institutions must have the proper continuous integration (CI) or continuous delivery (CD) model in place Deploy features with lower cost to production using processes and tools DevOps is the practice of integrating software delivery processes through engineering and automation: Enable rapid evolution of products or services Reduce risk, improve quality across portfolio and reduce costs End-to-end delivery process automation with DevOps Page 9
The move to an agile (and a CI/CD model) is, at times, more about cultural change than technology and leading practices Cultural and organizational implications Factor Guidance Methodology and execution Tools Business engagement Agile Project management Governance Business engagement Project management Methodology and execution Governance Evaluate whether the business model supports the need for LEAN and agile Define overall goal for the set of requirements around project approval Make sure the business is available for requirements management. and prioritization Set up programs using agile scrum or other models Manage dependencies and reporting at the onset Define and execute the right behaviors for executing agile, LEAN, or iterative, which is crucial to enable visibility and transparency Integrate current governance into the process for milestones Design for tool-based reviews Deployment Engagement models Training Engagement models Tools Deployment Engage shared services, such as architecture, infrastructure and corporate risk for defining their availability for agile Adopt the right tools, such as continuous integration, automated testing and reporting, that can integrate with existing systems and ALM Make sure the deployment windows and environments are available, as this will reduce the work in progress and enable faster validation and testing Training Train the entire organization on the concepts of agile to manage expectations and reduce conflicts, making sure that management and delivery teams have the same understanding Page 10
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