Study Shows Financial Services Organizations are in Early Phases of Multicloud Adoption

Research Reveals Hybrid Multicloud is the Ideal IT model, but the Financial Services Industry is Slower to Adopt

Nutanix, a leader in hybrid multicloud computing, announced the financial services findings of its global 2022 Enterprise Cloud Index (ECI) survey and research report, which measures enterprise progress with cloud adoption in the industry. The research showed that fewer financial services organizations have adopted multicloud than any other industry surveyed, trailing the global average by 10%. However, adoption is expected to nearly double from 26% to 56% in the next three years, in line with the global trend of evolving to a multicloud IT infrastructure that spans a mix of private and public clouds.

“As information security and operational resiliency remain front and center for financial services organizations, they must look to hybrid multicloud solutions with integrated manageability and security, and the ability to quickly move apps among cloud infrastructures cost-effectively.”

Among financial services ECI respondents, 31% are still operating non-cloud-enabled three-tier datacenters as their only IT infrastructure. They also reported having the lowest deployment of all industries surveyed in public cloud usage, with 59% using no public cloud services compared to 47% globally, likely due to substantial existing legacy investments in applications and the highly regulated nature of the industry. The complexity of managing across cloud borders remains a major challenge for financial services organizations, with 84% of respondents agreeing that success requires simpler management across multicloud infrastructures, and 50% citing security concerns as a challenge to the multicloud model. To address top challenges related to security, interoperability, and data integration, 82% agree that a hybrid multicloud model, an IT operating model with multiple clouds both private and public with interoperability between, is ideal.

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“While the financial services industry appears to be in the early phases of deployment, the evolution to an interoperable multicloud IT infrastructure that spans a mix of private and public clouds is underway,” said Anand Akela, VP of Product and Solutions Marketing at Nutanix. “As information security and operational resiliency remain front and center for financial services organizations, they must look to hybrid multicloud solutions with integrated manageability and security, and the ability to quickly move apps among cloud infrastructures cost-effectively.”

Financial services survey respondents were asked about their current cloud challenges, how they’re running business and mission-critical applications now, and where they plan to run them in the future. Respondents were also asked about the impact of the pandemic on recent, current, and future IT infrastructure decisions and how IT strategy and priorities may change because of it. Key findings from this year’s report include:

• Financial services organizations face multicloud challenges, including security (50%), integrating data across clouds (46%), and performance challenges with network overlays (43%). Given that nearly 78% cited the lack of some IT skills to meet current business demands, simplifying operations is likely to be a key focus in the year ahead. However, IT leaders are realizing that there is no one-size-fits-all approach to the cloud, making hybrid multicloud ideal according to the majority of respondents (82%). This model will help address some of the key challenges of multicloud deployments by providing a unified cloud environment on which security and data governance policies can be applied uniformly.
• Application mobility is top of mind. Nearly all financial services respondents (98%) have moved one or more applications to a new IT environment over the last 12 months, likely from traditional datacenters to private clouds given the industry’s relatively low multicloud and public cloud penetration. Faster app development (43%) was most often cited as the reason for the move, followed closely by security (42%), and integrating with cloud-native services (40%). Additionally, with a large majority (83%) agreeing that moving applications to a new environment can be time-consuming and costly, it’s expected that the adoption of containers will rise in step with multicloud deployments to enable apps to run and move nearly anywhere quickly and easily. Among financial services respondents, 86% said that containers will be important to their organizations within the next year.
• Top financial services IT priorities for the next 12 to 18 months include improving security posture (54%), improving multicloud management (49%), and developing and/or implementing cloud-native technologies (47%). When asked what their organizations had done differently because of the pandemic, 70% said they had increased spending to strengthen their security posture, 64% spent more on increasing AI-based self-service automation, and 64% invested in infrastructure upgrades.

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For the fourth consecutive year, Vanson Bourne conducted research on behalf of Nutanix, surveying 1,700 IT decision-makers around the world in August and September 2021. This report is supplemental to the global Fourth Annual Enterprise Cloud Index master report and focuses on cloud deployment and planning trends in the financial services industry, based on the responses of 250 IT professionals in banks and insurance companies across the globe. It compares the cloud plans, priorities, and experiences of these organizations to other industries and the global response base overall.