Cloud Computing and SaaS: Getting the Most Leverage

by Bart Narter, July 28, 2011
Industry Trends
Global, Asia-Pacific, EMEA, Latin America, North America

Abstract

Cloud computing and Software as a Service (SaaS) are two of the most used and misused terms in the industry. Celent describes where it is appropriate for financial institutions to take advantage of these offerings.

In this report, Cloud Computing and SaaS: Getting the Most Leverage, Celent lists the characteristics of areas where SaaS is most appropriate for financial institutions evaluating these areas on multiple criteria and scoring these areas for applicability to SaaS and the cloud. The top scoring application was collaboration software, followed by email.

SaaS is taking off in all sorts of areas. Core banking has been provided by service bureaus as a service (effectively SaaS) for years, and outsourcing email platforms, collaboration, and desktop software are newer areas where banks can receive better service at a lower cost.

“In many ways, SaaS on the cloud can offer superior service in areas such as archiving, disaster recovery, business continuity, and availability,” says Bart Narter, Senior Vice President of Celent’s Banking Group and author of the report. “Banks should take these factors into account when deciding whether to support certain functions in house.”

Celent is a research and advisory firm dedicated to helping financial institutions formulate comprehensive business and technology strategies. Celent publishes reports identifying trends and best practices in financial services technology and conducts consulting engagements for financial institutions looking to use technology to enhance existing business processes or launch new business strategies. With a team of internationally based analysts, Celent is uniquely positioned to offer strategic advice and market insights on a global basis. Celent is a member of the Oliver Wyman Group, which is part of Marsh & McLennan Companies [NYSE: MMC].

Media Contacts

North America (Boston)
Tylor Tourville
ttourville@celent.com
Tel.: +1 617 424 3284

Europe (London)
Chris Williams
cwilliams@celent.com
Tel: +44 (0)208 870 7875

Asia (Tokyo)
Yumi Nagaoka
ynagaoka@celent.com
Tel.: +81.3.3500.3023

Table of Contents

Executive Summary

3

Software as a Service (SaaS)

4

 

Some Example Uses of SaaS

4

 

The Values of SaaS

5

 

Concerns: Fact Vs. Fiction

6

Characteristics of Good SaaS Candidates

8

 

Size of Institution

8

 

Lack of Differentiation

8

 

High Availability Across Different Sites

9

 

Noncore Competency of IT Department

9

 

Security

9

What Works for SaaS?

10

Example of Banks Using SaaS to Their Advantage

14

 

The Capital Bank

14

 

Fidelity Homestead Bank

14

 

National Capital Bank

16

Conclusion

17

Leveraging Celent’s Expertise

18

 

Support for Financial Institutions

18

 

Support for Vendors

18

Related Celent Research

19

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