I’ve worked in banking long enough to remember the days when banks were nervous about hosting their data in the cloud. Most software products were installed on servers within the walls of the bank, which meant that on-site expertise was required to maintain the bank’s IT operations. Or any outsourced providers would need to dial in to address issues.
Those days are in the rearview mirror with the widespread use of cloud hosting, SaaS products, virtual servers and more. Community banks could take a mostly hands-off approach to IT … but should they? The key often lies in the amount of technical knowledge required and the availability of resources.
High stakes for critical applications
Hackers are smarter than ever and protecting data on a server within your bank can require expertise in everything from user management to password security protocols to anti-virus protection. That’s on top of maintaining the software products themselves. The reality is that cybercriminals are always coming up with new ways to attack, and most IT administrators are on the defense.
For small banks, a single IT administrator may not be enough. At a minimum, your admin should have access to external resources that can act in an advisory role. Those resources can be subject-matter experts on different functions (like firewalls or vulnerability management), while your internal person can execute. Or you may choose to outsource the security-related functions entirely.
Your mission-critical applications also need a high level of reliability. It might be better to rely on an outsourced vendor, who can guarantee uptime, instead of depending on the performance of your internal network and servers.
On- and off-site IT support
The good thing about cloud computing and virtual environments is that an IT administrator doesn’t need to be on-site. The doors have been flung wide open to hire from outside of your geographical region.
But if your Midwest bank hires an IT administrator from the West Coast, you’ll need to think about the tasks that have to occur within the bank. Who will install a new desktop or printer? Is employee access to the building controlled by a key fob?
It comes down to job responsibilities. What is required to occur on-site and what can happen remotely? You may find that the on-premises job is no longer a full-time role (especially if your branches are spread out and it’s not physically possible for one person to travel between them). In this case, you may want to contract with someone for work as-needed or outsource with a company that can provide services on demand.
Even when the responsibilities are internal, an IT consultant is always a good idea for large initiatives. A consultant can give feedback on everything from system requirements to integrations with other applications. Consultants also know best practices from working with other banks. Any consultant should be paired with an internal expert who can outline the business requirements — consultants won’t know your bank’s specific needs unless they’re told.
Consider your vendor management
With the prevalence of cloud options, you’ll likely have no shortage of vendors offering to host their products. But should each vendor host its own product? Or should you use a single vendor to host and control multiple products and solutions? It depends on whether the experience required is product-specific.
Many vendors may want to host simply so they can charge you a professional service fee, but there is nothing unique about maintaining the product itself. In that case, you’re better with fewer vendors to manage — particularly since each vendor that hosts sensitive data needs to go through an SOC audit and you’ll need to review the results of said audit. (And, as a side note, you’ll want someone with technical expertise to review any SOC audits so that red flags can be spotted.)
Ultimately, you’re relying on your IT team to protect your bank’s data, stay up-to-date on trends, and make many decisions about your daily operations. You’re also relying on them to keep things running smoothly so you can focus on your bank business. Combining internal and external technical expertise gives you the best combination of knowledge, experience and accessibility.