Technology choices in the financial services sector have become increasingly important in the past decade as a desire to stay ahead of competition, both established and new market disruptors, and the requirement to stay in line with increasingly proactive regulators, have made technology a key differentiator.
To some extent financial services has struggled in matching technology advancements to the pace of change being forced upon them, particularly so when technologies such as cloud computing appear to be a near no go area.
London Capital Group, a company that specialises in online trading services, was faced with a changing market, a desire for new technologies to take them forward and a tech stack that was either at end of life, full, or coming out of warranty.
CIO at London Capital Group, Blair Wright, told CBR that when he joined in February 2015, the IT stack had been left to grow organically, so trying to do anything in a structured format was a format, but the company saw this as an opportunity.
Wright said: "It really presented an opportunity to think where tech is going, where is the world moving to, what should we be looking at?"
LCG made the decision to choose a Nutanix enterprise cloud solution, a hyperconverged system, to host its core financial services.
The decision behind this choice consisted several different points, cost, a desire to move out of data centres, speed, and resources.
While looking at replacing hardware, LCG was also rebuilding its team of staff: "At the same time as looking at hardware we were rebuilding the team as well, so looking at the conventional route you are looking for people with storage skills and obviously service skills depending on what stack they get in to," said Wright.
This might mean that the staff might need to be more training in using an HPE toolset, or a Cisco UCS toolset. The problem is that the tech industry is faced with a skills gap, which means that finding staff with the appropriate skills could be costly and time consuming.
For LCG Nutanix had the solution, the converged system meant that the group could have more generally skilled people without giving to build a dedicated storage team, or a server team.
The converged solution also made sense for a faster change with less complexity, mainly because the converged offering means that LCG would deal with one company rather than multiple companies.
For many businesses the decision to refresh the IT stack has resulted in a move to the cloud but that is not always an easy path to take for financial services organisations.
Although there is a desire from LCG to be in the cloud, and it does do some work with Amazon Web Services, Wright said that traditionally there is a preference for the safety blanked of doing everything in-house.
Wright said: "Depending on what market you deal in there are some regulators such as Singapore that don’t like, or allow, client information to be held in the cloud, so there is always a need to have that option to have it in house.
"But also regardless of what you do in the cloud at the moment, in terms of the financial industry, there are a lot of infrastructure people who are still starting to get comfortable with the cloud and how it works."
So while regulations do play a significant role in the technology choice, the additional element of skills is also playing its part.
Wright said that London Capital Group’s decision to adopt Nutanix means that he hired less staff as there was no need to provide support staff all the time in the form of a server team staff member, storage team member, and someone from the networking team.
The skills gap is an often highlighted problem that for the LCG was a big factor in its next technological step.
In addition to simplicity and the skills gap, reducing the data centre footprint is another trend that the group is a part of.
The company has reduced its data centre footprint by 60% since moving to Nutanix, a reduction which has seen it renew its data centre contract for a few more years as this move alone has helped reduce the hosting costs enough for it to be more manageable.
London Capital Group’s technology choices highlight the variety of factors involved in choosing a roadmap for the future of IT. While barriers may be presented that hinder the adoption of some technologies such as cloud, other options are available that still lead to significant benefits.
