‘Cut Through the Noise’ With Cloud Computing, Data Backup

Ask the hard questions to find out what vendors truly offer.

September 19, 2012

Credit unions must sort through the “noise” that makes it difficult to separate static from substance when reviewing vendors to find reliable cloud services, disaster recovery and data backup.

“Your due diligence for backup systems, co-location, and cloud services is complicated because many vendors make claims they cannot back up,” says Jay Liebe, director, integration for Switch Communications Group, a CUNA Strategic Services provider.

Liebe says those claims create “noise” that makes it difficult to compare vendors based on crucial services and critical infrastructure. Credit unions must ask hard questions and listen carefully to the answers to learn what’s really being offered.

“Don’t settle for glib explanations about issues like where your data resides, how it’s protected, and even how it’s maintained, which is the element most likely to be overlooked,” Liebe advises.

Cloud concerns

Cloud computing is a relatively new service that demands greater scrutiny. Liebe says many vendors that provide cloud computing services are newcomers in serving financial institutions and providing infrastructures that deliver 100% uptime.

Inexperience can be risky. Even high-profile companies such as Amazon and Twitter have experienced outages in 2012 due to shortcomings in equipment or other infrastructure issues.

Liebe says high-profile outages should serve as a reminder of the importance of using experienced vendors with high-quality equipment in well-protected facilities. Liebe says those facilities should offer 100% uptime infrastructure that is “scalable,” which means it can grow with demand.

The need for both proven expertise and scalability is heightened by growing reliance on technology among both credit unions and their members.

Vendor selection

Liebe suggests asking these questions to find the right cloud computing vendor:

NEXT: Genisys CU takes hybrid approach


Member connections

Protecting your connection to members is vital in all situations, which may range from weather-related events to more common telecommunications issue, says Kirk Drake, CEO of Ongoing Operations, a CUNA Strategic Services provider. This credit union service organization provides business continuity services for credit unions.

Drake says members tend to be understanding about temporary disruptions due to a natural disaster affecting them at the same time it hits the credit union.

But when the problem hits at the point of demarcation or “demarc”—where the credit union’s telecommunications equipment connects with telephone carriers—members are less understanding because they are not experiencing the same disruption in their personal lives.

“We rarely have an event that impacts all credit unions, but about once a week we help handle an event that impacts one credit union,” Drake says.

Being ready for all types of disruptions is essential, Drake says. One credit union that recently lost power due to an electrical issue relocated its call center and some essential equipment to an Ongoing Operations site so members could stay in contact. Similar approaches have been used when credit unions’ ability to connect with members was disrupted by snowstorms and hurricanes.

Drake says the biggest mistake credit unions make when crafting a business continuity solution is assuming they know what would happen in a particular situation based on their own preferences and assumptions.

That can lead to vulnerabilities. For example, a credit union located in a tornado-prone zone might use a disaster recovery/back-up site in the same geographic area, which means one tornado could wipe out both sites.

“My advice is to hire an expert and let them tell you what happens in a disaster,” Drake says, “rather than trying to make that decision based on your perceptions.”

Genisys CU takes hybrid approach

Genisys Credit Union, Auburn Hills, Mich., is putting the finishing touches on a fully redundant, real-time backup data center in Grand Rapids, Mich., says Jackie Buchanan, CEO of the $1.45 billion asset credit union.

Buchanan notes that the new site is on the far side of the state and on a different power grid from Genisys’ primary data center. This will provide protection from natural disasters.

“This co-location will be connected to our multiprotocol label switching so in the event we lose our primary, all branch activity can be directed to the backup data center,” Buchanan explains. Genisys has also contracted with Co-op Member Center to provide back-up services for its call center.

The new solution replaces a real-time redundant system housed at a Genisys branch a few miles from the credit union’s primary data center, as well as a contract with an out-of-state, third-party provider for disaster recovery services.

Buchanan says Genisys went with a “hybrid approach” for co-location services that involves leasing rack space from its vendor and then bringing in the credit union’s own servers. The vendor provides the security, power, and other elements of a secure data center.

Relying on a partner that Genisys “knows and trusts” was important, Buchanan says, noting that members expect 100% uptime today.

“Find a partner that can keep your data secure,” Buchanan advises. “When developing your strategy, look at the big picture and how everything fits together, rather than one system at a time.”