Making a Case for Why Customer Information Systems Don’t Belong in the Cloud

By Gideon Hollander, CEO of Jacada Inc.


There is little doubt “cloud computing” is the buzzword du jour. One only needs to attend an industry trade show or read an IT publication or analyst report, and it will be evident that the world has “gone cloud,” or at a minimum, is rapidly moving to the cloud. Indeed, software vendors proudly boast of their cloud offerings, extolling the evils of “on-premise” software and systems.

We say, not so fast.

The reality faced by most CIOs is their need to be trusted guardians of their customers’ data. Those organizations at the lower end of data privacy and maturity naturally may feel less custodial responsibility. However, organizations that value customer data and privacy treat this information with what amounts to being akin to a fiduciary responsibility to their customer.
How can you ship your customer data off premise?

There is no doubt some cloud providers have impressive levels of security – yet, it doesn’t change the reality that customer information is taken off premise, beyond firewalls and exposed via a public channel on the internet. Not to mention there are internal threats within the cloud provider, such as a disgruntled (i.e.fired) employee.

We have already seen promises of “uptime” in the cloud compromised. Therefore, sadly, it is most likely a case of when, not if, we see a major data security breach in the cloud industry. Here are just a few examples:

• In April of this year, Amazon suffered an embarrassing multi-day service outage on some of its cloud services.
• On the security front, Dropbox, experienced a security lapse where, for a few hours, a user could log onto any other users account.
• Unfortunately, no company is immune. Other high-profile security breaches include Lockheed Martin, RSA, Citigroup and Sony.

Our intent is not to criticize these vendors as we recount these incidents. If anything, these companies have pioneered new industries in the cloud space and have been successful in what they do. Rather, we highlight this only to show how completely feasible outages and security breaches are. These outages remind us that behind the “cloud” buzzword, we are still dealing with fragile and complex technology, with multiple points of potential failure. From large cloud providers to the small ones, none of them are immune to coding errors, network failures, hacking or malicious internal behavior.

Do your customers know their personal information is technically accessible on the web?

In a poll of our customers, the majority emphatically stated theydo not plan to transition their call center data to cloud services in the next three years. Granted, these organizations have mature processes around handling customer data and  a leadership team that understands the responsibility bestowed upon them. However, most were absolute in their decisions.

The main reason? Consumer privacy. Many cloud solutions cannot guarantee customer security and privacy. In fact, one call center company that had moved customer information to the cloud moved everything back to an on-premise system to save costs, increase flexibility and protect consumer information.

This trend is not unique to our customers. In fact, research firm IDC conducted a survey of IT executives not only confirmed this trend, but found that availability and performance are major downsides for call centers’ dependence on cloud computing.

Should I abandon the cloud entirely?

Is the cloud completely bad? No, of course not. It is without a doubt the direction application delivery is moving. But when you assess your current cloud strategy, think about the potential for a security breach. What will you tell your customers when their social security numbers have been leaked onto the web? Do you believe they will understand that your organization deliberately and purposely opted to ship their data offsite and place it online on the internet? Our contention is the cloud should offer software as a service – the emphasis on software. The data on the other hand should never leave your premises. Think of software as a service, data as an asset.

Without a doubt, we will continue to see dramatic evolutions in cloud offerings. The cloud industry as a whole is still nascent. It will fundamentally change the way we are connected to the online world and become the invisible virtual fiber optic that links all our devices together, without regard to geographical boundaries. The possibilities are endless. In all the excitement however, let’s not forget who our customers are and what we owe them when it comes to data privacy.

About the Author

Gideon Hollander is the co-chief executive officer and founder of Jacada. Gideon is highly regarded for his strategic vision and innovation-centered leadership, and is focused on ensuring that Jacada delivers high quality, best-of-breed solutions. Prior to founding Jacada, Gideon was part of the research and development team at Comverse Technology. Prior to Comverse, he served in various technology and management positions in an elite unit of the Israeli Defense Forces, where he specialized in expert systems and user interface design. Two of the projects that Gideon managed won the most prominent Israeli award for technological innovations. Gideon also has a passion for rock and mountain climbing.

 

This article originally appeared on callcentreclinic.com Nov. 3, 2011.