We know that people would rather not think about bad things happening, much less the gazillion details required to ensure that credit unions stay open for business during a crisis, but sadly… it is a matter of when, not if.
At IMS, our corporate motto is “We Know Credit Unions” and when it comes to disaster recovery (DR), most CU’s place data protection high on their priority list. However, nineteen years as a Managed Service Provider (MSP) for financial institutions of all shapes and sizes, has taught us that while CU’s place a high value on DR, making headway toward reliable disaster recovery initiatives often ends up on the back burner.
Another commonality among CU’s is that many operate with lean IT staffing. When you consider all the projects and day-to-day maintenance involved in keeping a credit union running smoothly, it’s no mystery that disaster recovery tends to slide to the bottom of the priority list.
Statistically, it is not the massive natural disaster that poses the greatest risk to credit unions, it is simple human error or hardware failure that can cause daily operations to come to a screeching halt.
Human error is the single most frequent cause of business and IT disruptions, with the most significant economic impact. – Ponemon Institute – Cost of Data Center Outages, Jan 2016
Credit unions are wholly unique in the fact that many are smaller institutions with limited resources to allocate to IT related demands, and yet, they deploy systems that are more diverse and complicated than those of a typical business. The addition of the mandatory compliance requirements of financial institutions and the fact that all are prime targets of cyber criminals, creates additional burdens for IT staff. These unique factors cause a significant gap between what is required to properly maintain and secure the IT environment and the resources available to do the job effectively.
The reality for many CU’s is they may not have the resources available to provide the protections required to ensure that the business remains fully operational when disruptions occur. Situations where IT staffing is stretched to capacity, merely increases the likelihood of human error, thereby increasing the odds of data disruptions they work so diligently to avoid.
Another unique factor is the use of a “Core” system that requires IT staff to have extensive knowledge specific to that core. For many institutions, this may mean that there is only one individual on a team who possesses the skills set needed to fully manage and maintain the core. Since a single source of knowledge represents the proverbial weak-link scenario, situations of this nature often complicate IT disruptions.
Research indicates that many assumed cost savings of DIY backup and recovery components tend to evaporate and, when it comes to protecting critical IT data, there is genuine value in considering Disaster Recovery as a Service (DRaaS). For credit unions, the temptation to cut corners on backup and DR tends to be greatest in areas where scrimping on expenditures puts the institution at even greater risk of IT disruptions or outright failures.
The DRaaS market size is estimated to grow from USD 1.68 Billion in 2016 to USD 11.11 Billion by 2021, at an estimated CAGR of 45.9% from 2016 to 2021.
The key forces driving the DRaaS market are its features of faster recovery, cost-effectiveness, enhanced flexibility, and simple testing. Also, DR services provide automation capabilities that lead to limited utilization of resources and low up-front cost. With the increase in the adoption rate of DR services among Small and Medium Enterprises (SMEs), DRaaS market is expected to gain major traction during the forecast period.
– Markets and Markets – Disaster Recovery as a Service Markets – 2016
Next time you’re tempted to reach for the Easy Button, remember that disaster recovery is a complex and multi-faceted endeavor that requires constant vigilance and attention to detail. It also requires an IT staff that is proficient and up-to-date on all vital aspects of the Backup and Recovery domain.
IMS is a unique MSP in the DRaaS arena and is widely recognized for their intimate knowledge of credit union core systems, operations and extensive experience providing managed services in virtualization, networking, security and IaaS.