Cloud Sprawl in Financial Institutions

Leaking Data to the Cloud

Bob Lund, chairman and CEO

According to Computer Business Review, Cloud Sprawl is defined as the uncontrolled use of public cloud services in an organization with little or no input from management or IT.  It is especially problematic in the financial industry where rapidly growing amounts and variety of data have surpassed the IT department’s ability to provide adequate data management solutions.

Here’s a common scenario: one bank department uses Amazon Cloud Drive while another uses SkyDrive, and other employees use Apple iCloud or DropBox for collaboration.  None of the solutions are compliant with banking regulation, nor under the supervision of the IT group.

The growth of Cloud Sprawl is being driven by complex and lengthy IT provisioning processes, an unmet need for flexible, available document management solutions, the low price point of public cloud services and applications (easy to charge to a p-card), and the familiarity of employees with public cloud services.

The key concern for financial institutions is that uncontrolled public cloud deployment models are leading to security and compliance risks.

Some of the specific problems that Cloud Sprawl poses for financial institutions include:

• Data resident in accounts that don’t meet the bank’s security or compliance standards
• Unauthorized access to regulated data, including customer data
• Employees forgetting to delete data in cloud accounts that they set up
• Potential of data loss if the owner of a cloud account leaves the bank
• No corporate ability to audit usage and content of disparate cloud accounts and resulting inability to identify data risk and compliance problems

Not surprisingly, 67 percent of IT executives at companies with over 1,000 employees are worried about Cloud Sprawl, according to a 2012 study by Vanson Bourne.  Fifty-four percent of these IT executives admit they are unsure how many cloud services their employees use.  Worse, 20 percent of IT executives say it is “impossible” to manage disparate cloud services, finds Kelton Research.

eGistics provides applications for financial services that help control Cloud Sprawl, and delivers them on a highly secure, highly scalable cloud platform that offers:

• Tight user security 
• Activity audit reporting
• Data management procedures focused on banking compliance
• Centralized administrative control over secured data and its access
• Standardized workflows and processes 

The eGistics Cloud Sprawl solution builds on our:

• Fourteen-year track record in delivering cloud solutions
• Footprint in the largest financial institutions
• World-class infrastructure designed for data security and 7/24/365 access
• PCI certification and compliance with HIPAA, SSAE 16, SOC 1 & 2, and FFIEC

Feedback
If you are in a financial institution, and are seeing the effects of cloud sprawl, share your ideas and experiences!

Too Small to Succeed at Electronic Document Management

One Size Fits All?

Randy Davis, Vice President Sales and Marketing Operations

We've heard it ourselves in talking to prospects: "We're too small to benefit from an electronic document management (EDM) solution." Sometimes the prospect means "we don't process enough paper in a month," or "we don't have the technical staff to implement and support an EDM solution."

Whatever the reason, experience shows that "too small" may not be a good excuse to keep from making the move. The document management "suit" is not "one size fits all."

Consider this:

According to Ken Neal, a Certified Enterprise Content Management Practitioner and Director of Corporate Communications, for Océ Business Services, "In a recent industry survey, senior executives involved in document management indicated that document scanning has a high impact across the greatest range of business goals that include reducing costs, increasing competitive advantage, enhancing regulatory compliance, and improving customer service."

Benefits
In fact, scanning paper into a document management solution can provide even small companies with hard benefits (reduced paper storage and management costs, improved service, compliance and audit support, disaster recovery) and soft benefits (competitive advantage).

A compilation of studies* (including Gartner) put together by Formstack.com lists the following as making Cloud services, including document management, appealing to small business. Cloud services are mainly:

1. Affordable
2. Accessible
3. Usable

* (Thanks to Rachel Delacour of Bime Analytics for pointing out this "Infographic")

Considerations
Here are some things to consider if you think your office is too small:

1. Are you storing paper records on premise? If so, can you find needed records in seconds? Are documents safe from prying eyes or unauthorized removal? How will those records be quickly replaced if they are lost or destroyed?
2. Are you paying to store documents? This includes preparation, the cost of storage, file folders/boxes, transportation, retrieval and duplication.
3. Does your office look like it could qualify for "America's most cluttered office"? Running a business is hard enough. It's just easier to run a profitable business and service your customers if you can find important documents quickly. Besides that, staff and customers alike associate a messy office with sloth and inefficiency. There's just something about decent organization that makes people feel better about where they work or do business.
4. Are you under legal or moral obligation to protect or retain records for years and prove that you are doing so?

Counting the Cost
I will be frank here. Scanning documents and storing them in an electronic document management solution is not without up-front and on-going effort and cost. It's not a magic bullet. You may have to buy one or more scanners. You may need to create a barcode-based document identification system to help automate filing (this is easier than you may think). You may need to create a different (and better) process to capture, route, authorize and store documents. You may need to train someone how to use a PC.

The question that only you can answer is, "Will my business and staff benefit from changing the way we do things now?"

Eyes Wide Open
If you think that is possible, taking advantage of an electronic document management solution can go easier if you go in with your eyes wide open and after doing some homework.

Dan Antion, vice president of information services for American Nuclear Insurers, shares "8 Secrets of an Effective Content or Records Management Implementation":

1. You are not too small for Document Management.
2. Document Management offers value beyond the obvious.
3. Document Management is not a technology project.
4. Management support is required.
5. Document Management includes costs that are not obvious. [Scanners? Training?]
6. Document Management technology doesn’t have to be expensive.
7. Education is important and available.
8. All vendors are not created equal.

(Dan's full discussion can be found at AIIM.org's Digital Landfill, dated June 23, 2009.)

Call to Action
If you are a small business, hopefully this has given you a few things to consider on your way to a more efficient office. Start today the first step of evaluating your document management processes. At worst, you may discover some ways to make your existing processes better. At best, you may find that electronic document management can help you run a better business and prepare for the growing demands of instantly accessible digital information.

Do you think a company can be too small to use EDM? Share your comments.

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