Despite the dramatic upheaval that firms and their IT environments have faced over the last two years, new survey data from ITRS Group shows that the financial services industry is still making sacrifices on critical IT spend in favour of short-term budget priorities.
The research reveals that 88 percent of financial firms are selecting lower quality IT solutions, resulting in compromised IT resiliency – with almost eight out of 10 firms making these decisions as a direct result of inadequate budgets.
Further exacerbating the problem, digital transformation is significantly increasing the volume of data for 94 percent of firms, compromising real-time analysis and creating storage issues.
The impact of this has already made itself clear, evidenced by the ever-increasing amount of high-profile outages says ITRS Group . According to the survey’s results, over half of financial institutions are now suffering at least a full business day of unplanned down time each year.
While operational resilience requires financial investments that firms may believe they cannot afford, the survey’s results reveal that they cannot survive without it. And while investing in IT solutions may demand an upfront cost, many firms may not realise that not only do they have the potential to improve observability and ensure operational resilience, but, in the long run, they will drive efficiencies, helping to keep costs down.
“For financial institutions, operational resilience is fast becoming a ‘grey swan’ issue – a potentially significant event whose impact is widely underestimated. Insufficient understanding of the risks that poor operational resilience presents will create potentially fatal blind spots for firms,” according to Guy Warren, CEO at ITRS Group.
“The current landscape represents a do-or-die crossroads: prioritising IT resilience has never been more important. With the rate of digital transformation only set to increase, the industry’s epidemic of outages will continue to accelerate, unless drastic change takes place.”
“Incremental change isn’t enough; firms must overhaul their current structures completely, ensuring the importance of operational resilience is instilled across the entire firm’s operations from the top down. This can come in many forms, from increased allocation of funding to giving more power to internal players responsible for operational resilience.”
“Whichever approach firms choose, more robust operational resilience is key not only to firms’ regulatory compliance, but their very survival. The reputational damage and customer losses following repeated failures cannot be underestimated. Firms must act now or face the consequences later.”