CrowdStrike insights from Rory Yates, Global Strategic Lead at EIS FYI;
At first, all anyone in IT talked about was cloud adoption. The expansion of digital capability fueling the need for scaling and more adaptive environments to run these new services in.
Today, we often assume the cloud has reached maturity and instead spend most of our time talking about Cloud Agnostic vs. Cloud Native Architecture, and how we get the most out of it.
Of course, what’s true is the value of these services is typically high, and that’s why cloud continues to proliferate. However, what’s perhaps in question, is how those services are run and operated, and what it means to be truly resilient in provisioning your essential businesses services in these environments. With complex industries like insurance cloud strategies have always offered answers to a number of things, but also offered a lot of challenges as well. Insurers typically take a far more cautious and managed approach when compared to other industries. Along with
less digital transformation and a move away from hosted legacy systems, their maturity in some areas remains low. However, recent events have raised even more questions about cloud vendors and how they operate given the severe impact of their services on the world around us.
First of all, not all clouds are equal. Public cloud vendors have developed a range of capabilities that take them far from just hosting. This makes complete sense. They played to their underlying strengths and created differentiation. The Google Cloud Platform (GCP) leveraged its advanced infrastructure that supports big data analytics and machine learning projects.
Microsoft Azure seamlessly integrates with other Windows products, a wider suite of digital workplace offerings, and now has powerhouse GenAI capability waiting to be utilized.
Amazon Web Services (AWS) strategically embraced open-source technologies to create a more flexible cloud ecosystem of native and third-party tools for storage, database management, and cloud infrastructure monitoring. And there are countless other cloud service providers (CSPs), also competing for a growing market share.
The reality is that choice is useful. If you take severe outages the benefits of being able to switch out and redeploy are highly appealing. So too are being able to compare these services and get the best price and the right level of strategic interest in your business from these vendors.
This is also extremely hard and the cloud providers themselves aren’t operating to “standards” that make this easy.
As Michael Dwyer, CTO of EIS explains “Cloud Providers have become and are the modern equivalent of utility providers. As critical operators for day to day services in all aspects of the broader population’s lives, these providers need regulatory oversight just like the utilities of old.”
So what can we expect to see next?
Well, there’s already several moves in the EMEA marketplace which are looking to place even more responsibility onto cloud and SaaS providers. The Digital Operational Resilience Act (DORA) being one such example. It aims at strengthening the IT security of financial entities such as banks, insurance companies and investment firms and making sure that the financial sector in Europe is able to stay resilient in the event of a
severe operational disruption. In addition insurers are increasingly opting for a multi-cloud strategy, leveraging the strength of multiple clouds for a mix of their specialist capabilities. Those that complement the business’s needs, provide cost savings and vendor independence.
This is easier said than done though, especially where large monolithic modern legacy systems are still being adopted by insurers. And whilst many push the wares of cloud approaches, they are often single cloud capabilities reflecting their architecture and often that cloud isn’t native to their technologies.
This is important. It reduces independence and with it resiliency, but also reflects a real potential of a lack of adaptability. This in turn is often reflected in the way the systems work and can be adapted as well. Revealing ever more constraints and risks. We will see continued changes in the cloud industry. It will respond to these events, and regulators and market pressure also continue to mount up. Insurers right now need to make sure they can maximize the benefits of cloud optionality.
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