COVID-19 has pushed many organizations to adopt Cloud Computing, making them take on the digital transformation journey even before they anticipated.
In this article, I try to clarify those concerns about Cloud computing.
There is a cartoon floating around, in which stakeholders are discussing in the conference room how digital transformation is still years away for their organization, and outside the conference room, there is a storm of COVID-19 that is about to hit them. This cartoon pretty much sums up the state of the Digital Transformation journey many organizations are ‘forced’ to start in these circumstances.
Intensified discussions around Cloud computing during these times have just testified to this scenario. “Why do we need Cloud services?” has become “Which Cloud provider to select?”. At the same time, those who have adapted to it, have seen business continuity without much hindrance. Still, as always, the decision to adopt Cloud is mired with skepticism and irrational agitation. This skepticism and agitation stem from concerns that are still associated with Cloud. In this article, I try to provide clarification on those concerns.
How not being on Cloud can hamper business continuity severely
Before we get to the myth part, I would like to narrate this one particular incident that happened recently. Though the premise of this incident is around lockdown due to COVID-19, it testifies how not being on Cloud can hamper business continuity severely.
For one of our projects, deliverables were due in the first week of April. By then, our team had already started working from home per government directives. As the development environment for this project was on the Cloud, our team did not face any difficulty to continue working on the development part. Our work stalled as soon as we reached a critical part of data validation!
Data was on a client-server residing on their office premise. As the offices shut down due to the lockdown, we did not gain access to the data. We had planned to go to production but now we can’t! We are waiting for the lifting of the lockdown. This has severely affected plans for the client, adding huge costs. Many organizations in a similar situation are stuck both physically and digitally. Though this situation is unprecedented, it makes a strong case for moving to Cloud.
Still, I understand that some organizations may need clarity on certain things. So I have shortlisted concerns I have heard over time and attempted to give more classification on those concerns. I hope it helps organizations to make better and more informed decisions.
Concern 1: What if some unauthorized person gains access to our organization’s data?
It is essential to understand that sharing the space in the Cloud is done at the hardware level. However, virtual data is secure and separate. It is accessed by authorized personnel only. At the same time, for regulatory reasons, if it is required to have different hardware, then it is possible. Cloud providers (like AWS, Azure) have the facility of a dedicated instance where hardware is not shared with anyone.
Concern 2: I am skeptical about Security in Cloud.
Most Cloud providers are compliant with the most common compliance programs like HIPPA (US), FIPS (Canada), and ISO (Global). Hence, it is the default that data on the Cloud is encrypted. At the same time, it is the client’s responsibility to ensure data is encrypted while transferring.
Concern 3: Cloud is always costly.
The answer is, “It depends.” The key here is to optimize the utilization of the Cloud space efficiently. Cloud providers have enlisted many best practices to help customers save their costs.
Example: Using serverless applications to take advantage of pay-per-use facilities instead of constantly purchasing servers running or using Spot instances for batch processing.
As best practices follow, it proves that cost-saving opportunities are limitless. At Emergys, we have done a couple of projects where moving to Cloud saved almost 80% of the cost compared to having an on-premise setup. In current circumstances where the major focus is on cost-saving, moving to Cloud can create great opportunities in that perspective if the IT infrastructure is on-premise.
Concern 4: How to ensure that Cloud is the best in-suite for us without incurring extra costs?
Here is the good news! All cloud providers welcome new customers with a gift of credits. For example, Google Cloud gives away $300 credit for a year, while Azure gives away $200 for a month!
Small teams can use this credit and experiment to test fitment with existing infrastructure and future needs. The results of this experimentation can help make an informed decision without incurring huge costs.
Concern 5: Cloud is only for Big setups. It will be overkill for us.
Not at all! Instead, it does not matter what type of infrastructure it is, be it Big Data, Web Base, Data Warehouse, or Mobile users; Cloud is fit for all.
Cloud provider comes with a broad portfolio of services, ranging from Database, AI, Big Data, Web Development, IoT, Database. (Most of them are already managed) Therefore, any type of infrastructure can implement in the cloud. There are thousands of startups using the Cloud for various things.
Concern 6: It’s been a while since we updated our IT infrastructure. What if Cloud doesn’t work out for us?
This is where Cloud has the upper hand compared to other options, as only Cloud provides an opportunity to evaluate different architectures with minimum or no cost.
Example: If SQL Server 2019 needs purchasing, then a license for the year per core needs to be procured. However, on Cloud, the same setup can be implemented for a specific period and pay only for that user. This option of paying only for the duration of use will never be available for the On-prem setup.
Cloud also inherently adheres to the Agile principle, for example fail fast and rebuild fast. To conclude, I hope these clarifications on some of the common concerns about Cloud computing will help you accelerate your decision-making process. This pandemic has also proved that time for being skeptical about adopting Cloud computing has run its course.
Personalized Marketing
McKinsey points out from their study on market trends in different industries that personalization in marketing can help cut down customer acquisition costs by as much as 50% for businesses. Using the vast treasure trove of customer data, industry outlook, and market trends, insurance companies can streamline their marketing efforts to enable a more personalized outreach via campaigns and promotions to attract potential customers faster.
Connecting with customers in their local languages for promotions, sending mobile-friendly emails, and recommending products based on budgets obtained through past interactions with the insurance company are examples of how insurers can leverage data analytics and high-performance marketing automation to drive more conversions in their business.
Efficient Risk Assessment
When human agents calculate the risks on new applicants, there is always a scope for biased decisions or errors crawling into their thought process, and this can result in ignoring risks that may prove to be very costly in the future. The digital world is spawning new professions and roles that old algorithms may not be trained to recognize. Missing these potential customers because of a lack of knowledge could be a significant opportunity cost.
Over-compensating by lowering the bar could become a risk. Using AI-driven risk assessment techniques, hidden factors or risky behavior in a potential customer’s medical or credit history can be uncovered. Analyzing their online footprint can present more data points to be accounted for, thereby providing a more reliable profile.
Faster Claims Processing
Insurance companies often advertise their claims processing time as a vital selling point influencing buyer decisions. Using technology, the highly fragmented insurance claim process can be streamlined and rapidly completed with more accurate results. This would result in optimum service with minimum inconvenience for claimants and help insurers eliminate fraudulent claims by identifying data manipulation or tampering efforts in claims that generally are not discovered through manual inspection and processing.
Insurance companies worldwide are in a race to become leaders as the paradigm shifts in favor of the digital economy. They must deliver amazing customer experiences, build a risk-free customer base, and facilitate an open environment to collaborate with new age fintech startups to jointly sell and market their services. To achieve these milestones, insurance companies need access to powerful data analytics and high-performing emerging technologies like AI, and they also need guidance on how to best leverage these technologies for maximum ROI.
Get in touch with us to know more about the world beyond data analytics for insurance companies.
