Disaster recovery is one of those things that businesses don’t think of until they are faced with it.
Last year was full of tragic natural disasters and widespread political turmoil that directly affected millions of people around the world. Everything from the destructive flooding in Australia, Brazil and Thailand, to the deadly earthquakes in New Zealand and Turkey, and the devastating tsunami in Japan all shocked businesses into the understanding that it could happen to them. Despite this realization, research shows a lag in businesses’ backup and disaster recovery plans and procedures, especially within the U.S. financial services sector.
Financial institutions manage incredibly large amounts of data every day. In fact, in 2011, the trading volume for options increased 17 percent from 2010 to 4.55 billion contracts. What’s more, the American Bankers’ Association projects that there are 10,000 credit card transactions per second around the world, and Forrester estimates that by the year 2014, 66 million U.S. households will use online banking.
Protecting all this data is essential not only for financial institutions’ own critical operations, but also for the financial security of their customers. However, according to findings from the 2012 Disaster Recovery Index, conducted by the Ponemon Institute, a mere 35 percent of U.S. financial services providers are confident in their IT personnel to execute data recovery operations in the event of a disaster, and only a third believe they could recover quickly in the event of system downtime.
Despite the rising threats of natural disasters and cyber-attacks, a serious gap in backup and disaster recovery planning clearly exists within the U.S. financial services sector. This gap has grown to the point that 45 percent of those U.S. financial services SMBs surveyed in the 2012 Disaster Recovery Index said downtime costs them upward of a quarter of a million dollars a year.
With such a hefty price to pay for poor disaster recovery preparedness, it’s surprising that more of an emphasis isn’t being placed on backup and disaster recovery in the financial sector. Financial services IT managers cited several reasons for the discrepancy, including the fact that only 36 percent believe they have ample resources to execute effective backup and disaster recovery. Furthermore, just 38 percent felt they had sufficient support from their executives.
Moreover, the technology itself also proved to be a primary obstacle to proper backup and disaster recovery for U.S. financial firms, with 68 percent seeing the complexity of infrastructure across physical, virtual and cloud platforms as their greatest challenge. Delving further into this issue, this year’s Disaster Recovery Index found that 76 percent cited the availability of a comprehensive solution that addresses physical, virtual and cloud protection as a way to improve their disaster recovery strategy. Today, many companies struggle to manage multiple products from multiple vendors in order to protect their critical data. Not only does this approach lead to increased management burden and the potential for errors, but it can also be a very costly option with potential confusion when it does come time to recover in a disaster.
With all of the cloud and virtualization innovations over the past decade alone, it’s not surprising that many financial firms don’t believe they have ample technologies that enable comprehensive backup and disaster recovery operations. Advancements in these new computing environments are making it difficult for firms to keep their backup and disaster recovery procedures and technologies up to date and tested. While the cloud may promise ample benefits in terms of flexibility, accessibility, scalability and availability, many still question its reliability, especially in terms of backup and disaster recovery operations on a larger scale. In fact, further findings from the Disaster Recovery Index show that only 31 percent of U.S. financial SMBs agree that migration to new technologies such as cloud computing and virtualization will make it easier to ensure backup and disaster recovery operations are efficiently managed, leaving the rest wary of such new advancements.
Data backup and disaster recovery is absolutely essential for the financial services industry, especially as any data loss or server downtime can be fatal to their business and bottom line. This latest research shows that financial services organizations are in need of better strategies and training, as well as more advanced and comprehensive technologies to improve their backup and disaster recovery capabilities. For SMBs and remote branch offices with little or no IT support on site, it becomes crucial to have a fully integrated backup and disaster recovery solution plan that allows for remote management of all backup and recovery tasks from a central management system — one that can quickly recover a server, workstation or virtual machine and access multiple copies of each backup across any environment or just generally allow for file-level recovery in normal day-to-day activities.
Without the ability to predict the next hurricane, earthquake or blackout, having confidence in your backup and disaster recovery technology is crucial. For financial institutions, in particular, knowing that their most vital data, applications and services will be protected in the event of unpredicted downtime is not only paramount to their company’s bottom line, but for their customers’ as well. And, with such compelling data from the 2012 Disaster Recovery Index, perhaps financial firms in the U.S. will make backup and disaster recovery procedures and technology more of priority moving forward.