Introduction
At a previous company I worked at, we had a number of servers on a cloud platform that weren’t being used and should have been turned off. However, it was discovered that no one had turned them off and they had been running along silently in the background. In just three months, they had accrued almost £250,000 in charges before anyone had noticed.
These days, most insurance companies are using cloud services; either they are fully cloud or are using it in a hybrid manner. Some are using the cloud as just another data centre, which is probably the least cost-efficient way to use cloud technology. But others have figured out how to use the cloud in a more efficient manner. Wherever you’re at in your cloud journey, a strong argument can be made to use some cloud-native services.
What is ‘cloud-native’?
A cloud-native application is all about speed, agility and managing costs. It is built from the start to take advantage of the capabilities the cloud can provide. Just because you’re running services in the cloud, doesn’t mean they’re necessarily cloud-native. For example, you could run virtualised servers in the cloud, which is using cloud as Infrastructure as a Service (IaaS). And although this is a cloud service, most people would say it’s not cloud-native.
While such a solution does give you some benefits, it’s not as good as using services such as databases that are more cloud-native. These services fall into the Platform-as-a-Service (PaaS) model. With PaaS, the cloud provider takes care of all the feature and security updates, so you only have to worry about how you’re actually using the service.
Where things can get really interesting is when you use native services that you wouldn’t typically find in a traditional data centre. These could be things like natural language processing (NLP), artificial intelligence (AI) and optical character recognition (OCR). These are provided as Software as a Service (SaaS) and are things you would historically have had to buy separately – if they were available at all.
In short, the more ‘SaaS’ the service is, the more cloud-native it is and the less you have to worry about the upkeep of the underlying technology. The trade-off, of course, is that the more cloud-native the service is, the more you have to worry about vendor lock-in.
Benefits of cloud-native services
Focus
Cloud-native services allow you to focus on the functionality, instead of the upkeep and maintenance of the underlying platform. You can, therefore, service your customers in a more efficient manner, without the distractions that come with running your own data centre.
Automation
With the cloud, it is easier to automate some of the more mundane development tasks, such as release management and testing. The cloud providers offer native continuous integration / continuous deployment (CI/CD) tools to help automate the deployment of your code and applications in a controlled and safe manner.
Compatibility
There are a number of services cloud providers offer which you would previously have had to purchase from different providers. This would entail great effort in getting them to all integrate with each other. When they are all provided by the same cloud vendor, there is a greater chance that they will all work together well.
Security
There is still a lingering concern that cloud providers don’t provide the same level of security as on-premises systems – or even more dangerously, that they will provide a better level of security. However, under a shared responsibility model, the cloud provider will secure the services, but it’s still up to you to secure the data. You can get it just as wrong in the cloud as you can on the premise. But now you only have to focus on securing the data and don’t need to worry about applying the latest security patches to the underlying infrastructure.
Cost
While on paper, some cloud-native services can seem more expensive, you have to factor in the associated costs of supposedly lower-price solutions, including the people element, with having to maintain the underlying platforms. You can optimise the costs of cloud-native services by using things like auto-scaling to only pay for the usage as required. This can bring about efficiencies and potentially dramatic cost savings.
Time
Cloud-native services can get you up and running quicker than the traditional methods. Instead of waiting weeks or months to have everything set up, you can start in minutes, which means you can be responsive and productive in a way hitherto unseen.
Final thoughts
Using cloud-native services can bring about many benefits, but it can also be daunting to start. They require insurance companies to take a bit more risk than what they might be comfortable taking. But after helping a number of insurance companies to adopt cloud-native services, we have learned some valuable lessons. If you want to take this journey, we’d love to be your partner so we can help you go native.