HYBRID IT - ITRS GROUP

The hybrid model: challenges and solutions By Guy Warren, CEO at ITRS Group

  • 1 year ago Posted in

Like many sectors reliant on technology, the financial services industry saw a significant acceleration in the adoption of hybrid IT systems as a result of the COVID-19 pandemic.

What started as on-premise quickly morphed into cloud-based applications – but now, as businesses seek to get the best of both worlds, we have hybrid IT.

While a hybrid model can represent different things to different people, in general it refers to when a business utilises a mix of on-premise servers with the cloud – whether that be public or private. Usually, applications are either using both platforms to deliver their workload, or a cloud-based application is connected to an on-premise application for further processing. This means that application support teams need to be able to monitor both platforms and see the effect of the combined hybrid estate. This is where the problems start.

Because of its flexibility, hybrid IT is quickly becoming businesses preferred IT infrastructure. In fact, research has shown that 61% of businesses globally have a hybrid cloud model in place. But with its benefits, managing a hybrid IT estate does not come without its challenges. The complex nature of managing multiple systems means that financial institutions need to have a comprehensive strategy in place to ensure they maximise the benefits of both platforms.

Cloud versus on premise

At its initial conception, the main driver behind firms choosing to adopt a hybrid model was practicality. As they migrated from on-premise servers to the cloud or deployed new applications in the cloud, operating a hybrid model allowed them to manage this transition carefully and gradually – it’s simply not possible to migrate to the cloud overnight. The flexibility of renting in the cloud helped with faster provisioning of new servers, and helped with short term peak loads. However, the cost of cloud is not always appreciated at the outset. It is often more expensive than the fixed on-premise estate.

Nevertheless, operating such a model has offered businesses benefits that can’t be matched by opting for either a fully cloud or on-premise solution. The unparalleled flexibility and scalability of hybrid IT means that it has become more than just a stepping stone.

Due to each platform unique benefits and capabilities, certain applications are better suited to the cloud whilst others are better run on-premise. For example, financial exchanges require low latency networks for trading due to microsecond delays impacting profitability per transaction, meaning it's better for this type of business-critical infrastructure to be managed on-premise.

Whereas the cloud is far more scalable, meaning that if financial institutions are expecting a surge in demand – such as at the start of the COVID-19 pandemic, when there was a significant increase in users of online banking services as in-person branches shut down in the face of global lockdowns – firms can easily scale up to meet this service level. Having both systems in place means that businesses can adapt their IT systems to levels never previously experienced.

One size does not fit all

The distinct nature and competencies of both platforms means that a one size fits all approach is simply not an option when it comes to managing and monitoring them. Dynamic cloud environments can be a challenge for older tools which don’t like changes to the configuration on a regular or short-term basis. To combat this, many firms have invested in multiple monitoring tools, each focused on a particular technology and platform.

However, this means that each system is operating in silo, leaving IT managers without a complete overview of their IT estate. Not only does this make ongoing system monitoring difficult for IT teams, but their ability to mitigate and plan for outages risks is severely hampered.

Outages can have serious implications for a firm’s bottom line, in an exchange for example, even a millisecond outage can result in customers losing millions due to information being outdated. Ensuring operational resilience is therefore paramount, not least due to the financial impact but also as a result of the Financial Conduct Authority’s (FCA) bid to crack down on firms for lack of system resilience.

The FCA’s operational resilience regulations – CP19/32 – which come into force at the end of March, have significantly raised the stakes when it comes to preventing outages. Whilst the regulator won’t be knocking on the door every time one occurs, firms need to show that they have the right monitoring systems in place to protect consumers. For those firms who have complex hybrid estates, no exception will be made when it comes to not having the right systems in place.

Unified monitoring

To overcome these challenges, firms need to invest in unified monitoring systems. If they have siloed systems for storage, application performance and networks, for example, IT teams are unable to understand what is happening at a high level at any point in time. A single bird's eye view will not only help firms understand the capacity of their estates; but should a problem occur, getting to the source of it will be far easier when all operations can be viewed in one place. Few tools can monitor all they necessary elements well, so integration between tools is key.

For as long as long as hybrid IT dominates, investing in the right monitoring tools must be a priority for firms. It is the only way to ensure that they can manage their systems effectively, remain resilient and protect consumers in today’s fast paced financial landscape.

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