Table of Contents

Executive Summary ................................................................................................................................................ 2 1. Cloud Computing new buzzword in the industry ............................................................................................... 2 1.1 Essential Characteristics of Cloud Computing............................................................................................... 2 2. Adopting the Cloud Computing for the bank........................................................................................................ 3 2.1 Service Models in Global Front Solutions ..................................................................................................... 4 Software as a Service (SaaS) ........................................................................................................................... 4 Cloud Platform as a Service (PaaS) ................................................................................................................ 4 Cloud Infrastructure as a Service (IaaS) ......................................................................................................... 5 2.2 Suitable cloud for the bank............................................................................................................................ 5 3. Implications for the Bank .................................................................................................................................... 6 4. Challenges ......................................................................................................................................................... 8 5. Conclusion ......................................................................................................................................................... 9 6. Appendices ....................................................................................................................................................... 10 Cost Saving Calculation ................................................................................................................................... 10 7. References & Bibliography ............................................................................................................................... 12

Adopting Cloud Computing in Banking & Finance Industry

Executive Summary

Cognizant Technology Solutions is mainly involved in delivering various Application Development Management and Application Value Management projects within Private Banking and Investment Banking domain of Credit Suisse. This is a project proposal to implement the cloud computing within Global Front Solutions division of the Private banking domain. This proposal includes the brief about the Cloud Computing as an emerging technology, various benefits of the technology, its implications on the Credit Suisse and some of the probable challenges in the implementation.

1. Cloud Computing new buzzword in the industry Cloud computing is a new and hottest emerging technology in the industry. Whenever the emerging trends in the industries are mentioned, cloud computing is generally the mostly discussed term in conferences and press. Cloud computing promises to make the drastic changes in the way, IT solutions are normally developed, deployed and managed. Cloud computing is a technology which can reduce cost and complexity, accelerate innovation and provide the high scalability on demand. According to National Institute of Standards and Technology (NIST), Cloud computing can be defined as:Cloud computing is a model for enabling convenient, ondemand network access to a shared pool of configurable computing resources (e.g., networks, servers, storage, applications, and services) that can be rapidly provisioned and released with minimal management effort or service provider interaction. 1.1 Essential Characteristics of Cloud Computing

Adopting Cloud Computing in Banking & Finance Industry

On-demand self-service: A consumer can set the required computing capabilities, such as server time and network storage, as needed automatically without needing anyones help. Broad network access: It is ubiquitously available through standard internet-enabled devises. Resource pooling: The providers computing resources are balanced across a common infrastructure with no particular resource assigned to any individual user. Rapid elasticity: Capabilities can be rapidly and elastically increased or decreased at consumers will. Pay per use: Resource utilization can be monitored and reported transparently. Hence consumers are charged fees based on their usage.

2. Adopting the Cloud Computing for the bank Credit Suisse private banking domain provides the wide range of services, solutions and comprehensive advices to their private and corporate clients. Global Front Solutions, one of the divisions of private banking, leads the development and deployment of IT solutions that support Private Banking global business processes. Global Front Solutions develops the software solutions with the help of in-house IT department and also the offshore locations based in international locations such as India. It also takes care of the outsourcing of the software development and delivery from the external software firms. Each project generally involves the multicultural and multi locations. Hence Global Front Solutions is the best candidate to introduce the cloud computing.

Adopting Cloud Computing in Banking & Finance Industry

There are different service models of cloud computing and each service model caters to the specific need of the business. Within the Global Front Solutions, we can utilize different service models to make the most of the investment in cloud computing. 2.1 Service Models in Global Front Solutions Software as a Service (SaaS) SaaS makes use of cloud computing to host the application on the cloud rather than the traditional way of one application per desktop. All the users then access the application hosted on the central location. DirectNet, core banking application of Credit Suisse, can be the primary candidate for SaaS. Currently, the core banking application is hosted via the companys own infrastructure based in Switzerland. Cloud Platform as a Service (PaaS) PaaS provides the platform to develop and deploy new applications or services, not depending on specific platform to run. The availability of the platform does not let IT restricted by the platform limitations. As banks software solutions are currently developed and deployed at multiple locations and by multiple teams, PaaS will allow them to develop new applications and services that do not depend on a specific platform to run. In addition to development and deployment, PaaS also helps with the testing, collaborating and maintaining applications. The open architecture of the PaaS allows the applications in the cloud to be integrated with the legacy applications and to be made interoperable with on-site systems.
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Adopting Cloud Computing in Banking & Finance Industry

Cloud Infrastructure as a Service (IaaS) IaaS provides the on-demand computing power, memory and storage. Consumers are responsible for monitoring, managing and patching the infrastructure as they pay for what they use. Recently, bank has started the initiative called Synonym under which the teams at offshore development center can directly access the data from the servers in Switzerland which was not allowed earlier. This has been possible with the virtualization technology such as VMware on each desktop. This has resulted in several complaints about the performance of the desktops due to excessive memory consumption by VMware. IaaS can resolve these issues by taking care of managing computing power, memory and storage on the network.

2.2 Suitable cloud for the bank

Adopting Cloud Computing in Banking & Finance Industry

Private Cloud: The cloud infrastructure is owned or leased by a single organization. As they are owned by the single entity, they are built within a companys own firewall and ensure the efficient usage of companys IT resources. Private clouds also ensure the safety of the data and CIO owns all the data residing in Private cloud.

Public Cloud: This type of cloud is generally owned by the organization which in turn provides cloud services to general public or to a large industry group. The public cloud helps to extend the companies capabilities further by actually allowing IT services to be provided by parties outside the firewall over a network.

For the bank, it is advisable to have part of their IT in a private cloud and part in the public cloud, to balance the advantages of the public with the security of the private cloud.

Both the clouds are similar in the sense that they both dont require little or no capital investment.

3. Implications for the Bank Cost Reduction This is the first and the most important implications of having Cloud computing. Cost reduction will be achieved in three different areas: 1. IT assets can be added or removed as and when required hence there is no need to spend money on IT infrastructure upfront. This will also ensure that IT assets are utilized efficiently.

Adopting Cloud Computing in Banking & Finance Industry

2. Credit Suisse has millions of customers, which means the need of having a large data center and storage systems to store humongous data. Cloud computing will completely remove the need of large data center and storage system and as a result, there will be huge savings on Capital Expenses. 3. Cloud computing will lower the development costs of new application and services and will provide faster time to market. New business models

Cloud computing will offer an opportunity to transform the traditional business model to agile business model in the longer term. This new and agile business model will help the bank to drive growth and achieve the competitive advantage.

Sustainable and Greener technology

Recent study from Microsoft shows that compared to running their own applications, by outsourcing companies can reduce the energy use and carbon footprint of computing by up to 90 percent. (Cloud Computing is Greener, Harvard Business Review).

Flexible business systems

Cloud computing will make the system flexible by making them interoperable with legacy system but less dependent on them.

Business Analytics

Adopting Cloud Computing in Banking & Finance Industry

Business analytics is a huge focus at the moment for banks. The cloud will enable firstly to store but also to analyze an enormous amount due to access of both storage and to computing power.

4. Challenges Security The main challenge lies around security of the data. Sometimes, regulatory requirements of data privacy prevent the data, even if it is encrypted, to be moved on Public cloud. This challenge can be overcome by clearly identifying the data which cannot be placed on Public cloud and need to be moved to Private cloud. Even within the Private cloud, it is necessary to make sure that the cloud service includes data encryption, effective data anonymization and mobile location privacy. Governance Issue

Once the bank decides to go ahead with the cloud computing, it can leverage the cloud computing to achieve the economics of scale. For this, Bank needs to sort out the basic governance issue within the corporation. This means, bank may have to tear down the department silos and make sure they have standard services and processes internally. Unless bank can get the change in business mindset around collaboration, around doing common things in common ways, and about being prepared to buy cloud services, it cannot get the actual advantages out of cloud computing.

Laying out set of standards

Adopting Cloud Computing in Banking & Finance Industry

It is also important to work with the business to work out a set of standard service levels to decide what to buy from whats available on the cloud. This can be done by doing a proper fact based analysis to be aware of where the cost savings are. The services and cloud must be identified correctly to gain the most of the advantage from the cloud computing. Finally, it is very important to make sure the cloud actually delivers the promise so its not just immediate but actual ongoing reduction in cost.

Flexibility or long term contract It is very important to weigh the options of being flexible or getting locked into long-term arrangements with suppliers. If bank promises to get locked in, it would be easier to negotiate the prices and gain the upfront cost savings. On the contrary, long term contract reduces the future flexibility to get out of cloud models. Spreading cloud computing across the organization

It is very important to keep cloud computing on track because more spread of cloud computing across the infrastructure will help organization to reap the most benefit out of it.

5. Conclusion Cloud Computing holds a lot of promise and it is likely to be a major influence on hosting and application development. Cloud computing is the emerging trend in the technology which will help Credit Suisse to up the innovation and lower the cost. In addition to cost reduction, this will provide scalability, sustainability and an opportunity to change the business by entering the new era of transformation.

Adopting Cloud Computing in Banking & Finance Industry

6. Appendices Cost Saving Calculation The following cost saving calculation has been done with the help of Cloud Computing TCO Calculator.

$275,144 in upfront costs can be avoided and $138,884 can be saved per year using the cloud with RightScale versus a datacenter deployment over a five-year term.

Utility Pricing

Pay for what you use:

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Adopting Cloud Computing in Banking & Finance Industry

Convert 70% of your servers to flexible, on-demand instances.
Shared, Flexible Capacity

Server utilization: Increase your server utilization from 30% to 60%. Server capacity: Knowledge that your system can automatically scale to meet any demand = Priceless
Datacenter Optimization, Scale and Reliability

Facility, hardware & power cost: Reduce your cost per compute hour from $0.68 to $0.12 in the cloud. Down-time: Reduce down-time by 1,892 server-hours annually.
Agility

New deployment time: Launch new production deployments in 75% less time. Provisioning time: Reduce server provisioning time from weeks to minutes. Admin resources: Manage cloud infrastructure with 3,763 fewer admin hours.
Control

Cost transparency: Know your monthly spend: $3,532 for computing and $1,120 for storage.

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Adopting Cloud Computing in Banking & Finance Industry

7. References & Bibliography Books:  A Brief Guide to Cloud Computing: An Essential Introduction to the Next Revolution in Computing- By Christopher Barnatt  Cloud Computing: Principles, Systems and Applications- By Lee Gillam References:  http://www.microsoft.com/industry/government/guides/cloud_computing/default.aspx   http://www.accenture.com/us-en/industry/financialservices/banking/podcast/Pages/insight-cloud-computing-banking-transcript.aspx  http://kaizaramin.com/2009/02/12/cloud-computing-a-technical-perspective/  http://kaizaramin.com/2009/02/05/cloud-computing-in-plain-english/  http://www.walteradamson.com/2010/04/cba-cloud-computing-michael-hartestrategy.html  http://opencloudmanifesto.org/Cloud_Computing_Use_Cases_Whitepaper-4_0.pdf  http://mescal.imag.fr/membres/derrick.kondo/pubs/kondo_hcw09.pdf  http://www.ebizq.net/blogs/enterprise/2009/08/what_does_cloud_computing_actu.php

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