Originally posted on Rentsys Recovery Services' blog.
Every year the William Mills Agency releases a Bankers As Buyers report containing essential information and statistics about the technology trends that are popular in the U.S. financial services industry.
In this year's report, we found three key takeaways that your firm should keep in mind as you update your 2014 disaster recovery (DR) plan.
Outsourcing Is Gaining Momentum
"...institutions are doing everything possible to utilize system functions to make their employees more efficient."
As margins become slimmer due to factors such as declining fee income and larger expenses, institutions have to think leaner and find ways to run more efficiently. One strategy is outsourcing technology management and system maintenance to a trusted service provider.
According to Jerry Silva from IDC Financial Insights, spending on third-party providers has increased by 17 percent in the last 10 years. Using an outside provider for IT hardware and services, including DR solutions, is becoming more popular due to a new mindset among financial firms: "You run my technology, I'll run my institution."
This year, forward-thinking financial firms are looking for sophisticated, high-availability technology, particularly cloud solutions. They are working with an experienced technology and cloud services provider in areas like data vaulting and recovery to eliminate the cost associated with maintaining secondary or tertiary data centers.
Compliance Strategies Are Evolving
"With an additional 4,000 pages of new regulations that went into effect on Jan. 10, banks are planning how to keep up with the changes."
Compliance and regulation is getting more costly for financial institutions with no signs of relief. The CEB TowerGroup mentioned how the Consumer Financial Protection Bureau has only put into effect 42 percent of the new rules defined by the Dodd-Frank Act as of December 2, 2013.
The compounding layers of regulations are forcing banks to find alternate solutions for managing the expense of maintaining compliance. Technology partners and co-sourcing compliance functions are helping institutions drive down costs and improve efficiency. It's important to look for vendors who understand how compliance relates to their role within an institution and add value by minimizing the compliance burden.
Vendor Consolidation Is Increasing
"...banking technology has become more complex, uptime more critical and integration essential to success."
Historically, banks and credit unions purchased technology solutions as needed from multiple vendors (e.g., a VAR for hardware, a cloud services provider for data vaulting and recovery, etc.). When it comes to disaster recovery, meeting recovery objectives for a fast-paced, complex infrastructure paired with compliance and security concerns is driving the need to consolidate vendors.
Aligning with a technology partner that understands your industry and has the capability to optimize integration can improve performance and drive down cost. Using a disaster recovery provider that offers off-site data backup, compliance monitoring and more improves data security and reduces complications and vendor conflict at time of event.
What DR tech trends are you getting on board with this year?