Misconceptions of Artificial Intelligence
Part 3: Change the Conversation
By Shazia Manus, Chief Strategy and Business Development Officer, AdvantEdge Analytics
Continuing our series on three misconceptions of artificial intelligence (AI), this post explores a common fear around what it will take to achieve the processing power necessary for AI success: cloud computing.
Misconception: AI requires the cloud, and that’s too risky.
Truth: Cloud and on-premises IT both present risks.
Apprehension around migrating from on-premises to cloud technology continues to slow the digital transformation of many legacy providers, and credit unions are no exception. It’s natural, particularly for member-centric organizations, to be cautious about adopting emerging technologies. However, it’s time to change the conversation around cloud computing so more credit unions can accelerate the delivery of even better experiences for an increasingly digital-first constituency.
What does the cloud have to do with AI?
AI machines require a strict diet of real-time big data to thrive. Many credit unions, large and small, are not currently equipped with the computer processing power necessary to feed the AI appetite. However, the democratization of cloud computing has made the technology more accessible than ever before.
So, what’s keeping more credit unions from making the leap to the cloud?
Although cloud computing has become more prevalent throughout the financial services ecosystem, fears around security remain. Yet, researchers who have compared on-premises and cloud environments often conclude public clouds are more secure than traditional IT systems. Their findings are changing the minds of decision makers across industry verticals. In fact, 64 percent of enterprises now consider cloud infrastructure a more secure alternative to legacy systems.
This is due to three factors in particular:
- Cloud infrastructure is continuously monitored and the subject of annual audits.
- Cloud security is layered.
- Updates and patches are performed more frequently.
Wired contributor Todd Nielsen put it this way:
“If you run a company that has a dedicated team of security experts that are monitoring your network 24/7/365 for all exploits and security risks, and this team can take instant steps to secure the network in case of problems, and you have a team that is constantly testing software and updating it to fix security holes, then sure, traditional computing can be more secure [than cloud].”
Unfortunately, few of the ifs described by Nielsen are prevalent in the community financial institution space.
Credit union competitors, both mainstream and non-traditional, have wrestled with some of the same apprehension around cloud computing. Yet, they are pushing forward, using cloud systems to become more agile, discover new value propositions and adapt to new markets.
Here’s what Nick Funnell, a Barclays executive, said about his bank’s use of the cloud:
“With cloud technology, you can scale from zero and get to market very quickly; and get an idea to market in weeks, if not days. To take advantage of that, you have to be fast, you have to be nimble and you have to be reactive.”
The number of providers migrating to the technology doesn’t show any signs of slowing. In fact, Gartner predicts cloud data centers will process 92 percent of workloads by 2020.
To calm fears while also acknowledging the very real concern about security, Gartner suggests the conversation shift from “Is the cloud secure?” to “Am I using the cloud securely?” By focusing on secure use of the cloud, more credit unions can explore integration of advanced technologies like AI.
Many of the most promising digital transformation technologies, including AI, are being both born and matured inside cloud environments. That translates to a very real threat of disruption facing incumbents that do not leverage the powerful platform.
To read more about the future of technologies like AI and the cloud within the movement, download our latest white paper: How Humans and Machines Will Transform the Credit Union Industry.