How FinServ Companies Using Hybrid Cloud Architecture Can Avoid Costly Outages

It’s an accepted trend that digital transformation enables faster, easier, more personalized transactions for financial services organizations. Over the past several years, legacy players have found themselves playing catch-up with digital-born startups. These cloud-first players often benefit from having redundancy and security built in from the start, while traditional financial services organizations tend to carry technical debt and may still be looking to see the return on their investment in physical infrastructure. And while they are in pursuit of better performance, they have a bigger concern — resiliency.

New research shows that the hourly cost of downtime now exceeds $300,000 for 91% of SMEs, and nearly half of mid-to large-size enterprises report that an hour of downtime could cost as much as $1 million. IT decisions are not only being driven by budget limitations, they are being driven by operational continuity because it is clear now, more than ever, that this has a massive impact on a company’s bottom line. There are many issues that impact performance and threaten to take a company offline — from malicious threats and distributed denial of service (DDoS) attacks to misconfigurations, which are usually due to human error and redirect online traffic to a dead end, and high latency in a context where even a fraction of a second delay qualifies as a slow response.  

Many banks today are looking for ways to make the most of their existing infrastructure while improving resiliency but without shifting wholly into the cloud. They have found that a full-scale migration may not, in fact, be the best fit for their organization, and instead, they are keeping much of their foundational infrastructure technology on-premise. With this hybrid approach, they are looking for ways to achieve the seamless experiences that those digital-born companies are able to deliver along with the 24/7/365 uptime required by financial services. There are a few best practices that will help them achieve these goals. 

Achieving Dual Goals: Resiliency and Performance

Most financial services organizations offer globalized services, which means delivering operations on a massive scale, and they must meet the need for constant uptime. There is no room for error — misconfigurations, latency, network congestion, and denial of service attacks can all create major problems. Best practices, and in many cases regulations, require there to be no single point of failure. 

This is why many financial institutions are reconsidering their perspective on the Domain Name System (DNS) — the connection point between a financial institution’s online services and its customers. As a critical IT component, it is vulnerable to multiple scenarios that could result in a bank’s website and access to its applications becoming unavailable, not only wreaking havoc on operations but creating substantial costs. This could be anything from network outages to something more sinister. However, because of the role it plays in infrastructure, it can also be a point of leverage and redundancy that IT teams can use to improve ROI in hybrid infrastructure while improving resilience. 

Building Resiliency at the DNS Layer

Outages and threats are inevitable. The best solution to managing risk is to embrace infrastructure resiliency strategies that include redundancy, particularly at the DNS layer. This may include running multiple DNS services — perhaps a managed DNS and an open source solution or two managed DNS providers. This will ensure that if one fails, another one is still up and available, eliminating the single point of failure that renders systems and services out of action. This is especially important when international banking services are being provided across multiple geographic locations: note that agreements with providers must include an assurance that the bank’s applications will operate if the primary provider goes down. 

Another scenario could also look like adding enterprise-grade managed DNS services in parallel to a company’s on-premise DNS servers. These help them not only to comply with domestic regulations and to make a connection between on-premise and cloud resources but also to help meet their primary goal – resiliency. As the threat landscape becomes even more acute, and traditional financial services companies strive to keep up with their digital-native counterparts, we anticipate that the approach of adding multiple layers of DNS redundancy will become increasingly standard. 

Another way to ensure resiliency is to enable intelligent traffic steering, which ensures application traffic is automatically diverted around outages or poor-performing resources in real time. Banks can avoid service disruptions and optimize the online banking experience for customers, who get a seamless connection to applications and services based on their location, regardless of the device they are using.  

Given that the expectations of customers have never been so high, this quality of service is essential. The ability to make transactions in moments with confidence that their funds are being transferred securely is what customers demand. This is critical not only in client retention but also in attracting new, loyal customers too. 

Network Visibility Is Key to Resiliency 

When it comes to hybrid IT, finserv companies will reap great benefits from prioritizing visibility into their networks and applications. They should implement tools that enable them to analyze, assess, and respond to the plethora of data being generated, but the key is to push analysis as close to the data source as possible. Tapping into network data streams, including data from the DNS layer, and analyzing them in real-time provides invaluable business insight that can reduce mean time to resolution, help debug issues, and identify security risks. Distributed network visibility is essential for operations, capacity planning, and security, as well as for long-term growth. 

Resiliency Boosts Bottom-Line Outcomes

Across the financial services sector, organizations seek to achieve two things: to optimize the user experience and maintain resiliency. As the connection between company networks and customers, DNS is more than a point of risk — it presents an opportunity to maximize performance, security, and resiliency. If companies follow best practices to implement redundant DNS networks and intelligent traffic steering, while capitalizing on the data generated by these networks, they can achieve these goals, avoid costly outages, and boost their bottom-line outcomes.