# There’s a fine line between relinquishing control and accountability. Financial institutions must balance both to successfully cloudify operations and meet customer expectations Author: Pal Sinha, Barnali Author URL: https://financedigest.com/author/pal-sinha-barnali Published: 2021-05-23 Category: TECHNOLOGY Category URL: https://financedigest.com/category/technology Meta Title: How Financial Institutions Can Leverage Cloud for Customer Meta Description: Discover how cloud technology can help financial institutions adapt to changing consumer habits and drive innovation in a seamless and agile manner. URL: https://financedigest.com/theres-a-fine-line-between-relinquishing-control-and-accountability-financial-institutions-must-balance-both-to-successfully-cloudify-operations-and-meet-customer-expectationshtml ![undefined](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/theres-a-fine-1736838315699-compressed.jpg) _By **Daniel Meere,** VP, BFS&I Consulting, UK&I, Cognizant_ Consumer habits are changing. We now increasingly expect a seamless and agile experience from the brands and businesses we interact with. This is no different when it comes to [financial services](https://www.financedigest.com/how-financial-services-companies-can-successfully-utilise-low-code-and-no-code-technologies.html "How financial services companies can successfully utilise low-code and no-code technologies") providers. As such, [financial institutions](https://www.financedigest.com/how-can-financial-institutions-make-the-most-of-data-for-their-business.html "HOW CAN FINANCIAL INSTITUTIONS MAKE THE MOST OF DATA FOR THEIR BUSINESS?  ") are searching for new ways they can optimise and transform the experience they offer to customers and many have been turning to cloud for its flexibility and agility. Cloud is central to any [digital transformation](https://www.financedigest.com/how-digital-is-transforming-finance-in-2023.html "How Digital Is Transforming Finance in 2023") strategy, and this has been especially true throughout the pandemic. However, incumbent financial institutions that lack expertise in the [technology domain should seek support from tech-savvy partners who can ensure it’s a seamless migration and that they are best positioned to leverage all of the benefits cloud](https://www.financedigest.com/the-benefits-of-adopting-cloud-technology-in-the-finance-industry.html "The benefits of adopting cloud technology in the finance industry") has to offer. **Key [steps for a successful](https://www.financedigest.com/ten-steps-to-a-successful-start-up.html "Ten steps to a successful start-up") cloud migration** [Investment in cloud has increased rapidly during the pandemic](https://www.forbes.com/advisor/banking/banks-accelerated-transition-to-the-cloud/), with the global financial cloud market [expected to grow from $16.55 USD billion in 2018 to $46.03 billion USD by 2023](https://www.marketresearchfuture.com/reports/financial-cloud-market-7492). However, only a small number of transaction workloads have already fully [migrated to cloud](https://www.financedigest.com/a-cloud-migration-guide-for-financial-institutions.html "A Cloud Migration Guide for Financial Institutions"). As consumer expectations of [financial services are now driven by what they experience from other industries, where cloud’s high capacity is being leveraged to store vast amounts of data, financial institutions must](https://www.financedigest.com/the-financial-sector-must-act-to-tackle-internal-data-security.html "THE FINANCIAL SECTOR MUST ACT TO TACKLE INTERNAL DATA SECURITY") cloudify more of their operations to be able to deliver against customer expectations. [Cloud offers many benefits](https://www.financedigest.com/can-finance-reap-the-benefits-of-the-cloud-without-compromise.html "Can finance reap the benefits of the cloud without compromise?") from an operational level. For example, as data is stored on a cloud provider’s server, financial institutions no longer need as many people to manage these operations as before, which means they no longer need as much [office space](https://www.financedigest.com/a-guide-to-finding-office-space-for-your-startup.html "A guide to finding office space for your startup"), so their operating model fundamentally changes, and this leads to a lot more remote delivery. For [financial institutions](https://www.financedigest.com/3-ways-financial-institutionscan-leverage-live-engagement-on-social-media.html "3 ways financial institutions can leverage Live Engagement on social media") wanting to migrate operations and workloads to cloud, though, it is a question of hand holding. But how do you hold someone’s hand just to get them on that journey and make it a success? Well, there are three elements: technology, culture and people. While a longer-term ideal would be for multiple [financial institutions](https://www.financedigest.com/the-future-of-financial-institutions-in-2023.html "The Future of Financial Institutions in 2023") to collaborate, this is an opportunity for the future. For a single [financial institution](https://www.financedigest.com/what-the-future-holds-for-financial-institutions-in-2023.html "What the Future Holds For Financial Institutions in 2023") to make its cloud transformation a success and to really adopt the cloud, it must start by: 1. Creating a common architecture and a hybrid framework, which is not isolated to one public or private environment. 2. Defining the blueprint and the transformation path, questioning what the [current landscape](https://www.financedigest.com/dry-ice-market-2015-outlook-current-and-future-industry-landscape-analysis-2025.html "Dry Ice Market 2015 Outlook, Current and Future Industry Landscape Analysis 2025") looks like and how heterogeneous the technology is from an application perspective. 3. Implementing an auditing process in case of eventualities. **Why having a tech-savvy partner on board is key** Technology like cloud is not where financial institutions’ expertise lies, despite it being key to solidifying their future by accelerating innovation to [meet customer](https://www.financedigest.com/stay-ahead-of-the-curve-and-meet-your-customers-payments-needs.html "STAY AHEAD OF THE CURVE AND MEET YOUR CUSTOMERS PAYMENTS NEEDS") expectations. So, sourcing better-placed partners to collaborate with could help traditional [financial players balance cost](https://www.financedigest.com/how-much-does-cloud-based-financial-software-cost.html "How Much Does Cloud-based Financial Software Cost?"), agility and innovation, and deliver to market at a faster rate. [Incumbents should also be looking to new fintech](https://www.financedigest.com/launching-speed-boats-from-cruise-ships-how-incumbents-can-take-on-fintech-challengers.html "Launching Speed Boats from Cruise Ships: How incumbents can take on fintech challengers") players for inspiration. In many ways they already do, especially to learn from fintechs’ dynamic nature and the [way in which they know instantly what the customer](https://www.financedigest.com/customer-engagement-whos-leading-the-way.html "Customer engagement – who’s leading the way?") wants and how to respond to this. Some of that ability is because they have smaller customer bases, meaning they affect fewer [customers to affect by change](https://www.financedigest.com/talk-to-me-the-changing-face-of-customer-communications.html "TALK TO ME :THE CHANGING FACE OF CUSTOMER COMMUNICATIONS"). Some of it is also just because they have a different mindset. There is a real advantage to financial institutions in being able to absorb some of that culture and outsource some tasks that would take [banks a long time and cost](https://www.financedigest.com/factbox-global-banks-take-axe-to-jobs-as-cost-pressures-mount.html "Factbox-Global banks take axe to jobs as cost pressures mount") to deliver. [Financial institutions talk about ‘cloud-first’ platforms](https://www.financedigest.com/make-way-for-the-rise-of-the-finance-super-apps-consolidation-of-financial-digitisation-tools-platforms.html "Make way for the rise of the Finance Super Apps – Consolidation of Financial Digitisation Tools & Platforms"), but just embarking on cloud is not going to provide innovation, flexibility or even a cost-benefit, unless there is a cultural change within the organisation. However, many incumbents have been too quick to dismiss fintech firms and have been on a mission to either acquire or annihilate them. Today, there must be more focus on looking to partner with and learn from these kinds of tech-savvy companies. Financial institutions [must also understand that this may result in conflict as innovation](https://www.financedigest.com/why-the-finance-sector-must-prioritise-mobile-security-over-innovation.html "Why the finance sector must prioritise mobile security over innovation") cannot be outsourced, and financial institutions must understand relevance and the fact that fintechs are not only part of the financial ecosystem but are also in direct competition with them. [**Changing a years-old mindset**](https://www.financedigest.com/dispute-management-mindset-changing-the-disputes-game.html "Dispute Management Mindset: Changing the disputes game") As a vital part of any [cloud migration journey](https://www.financedigest.com/why-finance-professionals-must-bank-on-a-journey-to-the-cloud.html "Why finance professionals must bank on a journey to the cloud") by an incumbent financial institution, a mindset shift needs to occur – not just from a cultural perspective, but from an operational and business one too. Financial institutions need to realise that they’re going to be providing [banking services to customers](https://www.financedigest.com/christmas-debt-hangovers-how-banks-can-help-customers.html "CHRISTMAS DEBT HANGOVERS: HOW BANKS CAN HELP CUSTOMERS") while someone else provides the cloud service to them. On one hand, while you may have the advantage of scale, lower cost, flexibility and agility, this will result in a reduction in the control that is exerted over [services which many aren’t used to as historically financial](https://www.financedigest.com/how-financial-services-are-overhauling-security-to-defend-against-spoofing-scams.html "How financial services are overhauling security to defend against spoofing scams") institutions have created and managed their own infrastructure. Ultimately, cloud infrastructure is forcing [financial services](https://www.financedigest.com/devops-the-secret-tool-thats-transforming-financial-services.html "DevOps: The Secret Tool that’s Transforming Financial Services") executives to think about not owning their infrastructure, relinquishing an element of control, and adapt to working with a service provided by an outsider. However, financial institutions will still be regulated for their use of cloud and regulators are continuously making the [point that buying in services](https://www.financedigest.com/service-the-cfo-why-context-is-worth-80-iq-points.html "Service & The CFO: Why Context Is Worth 80 IQ Points") rather than owning them does not mean outsourcing the accountability. Banks can [control the outcomes through their own performance and consequently create an environment where all constituent parts can work together to deliver](https://www.financedigest.com/trendrating-1-3-delivers-faster-data-analysis-and-enhanced-risk-control-tools.html "Trendrating 1.3 delivers faster data analysis and enhanced risk control tools") the right outcome. --- This blog is powered by Superblog. Visit https://superblog.ai to know more. ---