One of the most critical business challenges associated with the highly distributed nature of global financial service institutions (FSI) is the need to meet regulatory compliance requirements and to reduce their total cost of ownership especially in supporting remote branch operations while balancing the performance and availability of information at these locations.

Two major approaches to the branch computing challenge have been followed.

One approach is to consolidate and centralize all servers, on the basis that centralization better meets financial and regulatory concerns. Centralization provides higher utilization of servers and reduces server costs, reduces operations costs including power, staffing and management and provides increased agility to accommodate network changes (e.g., new sites, unexpected growth, site decommissioning). Centralization also facilitates business continuity and disaster recovery planning. Faced with degraded application performance associated with network latency and 'chatty' protocols, enterprises have had to upgrade the network bandwidth with higher cost and deployed appliances to address application performance caused by network latency issues. Increasing bandwidth and purchasing single point appliances to address WAN optimization, application acceleration, file and print services brings with it increased network complexity and management costs, and substantially erodes the value of centralization. Even with a high degree of centralization, the problem of providing efficient backup for PC clients is still problematic.

The other approach, also followed broadly in segments of the financial services industry, is basically to forego centralization until bandwidth costs decrease and deploy branch office servers for email, application support, file and print services. A key challenge of this approach is remote site IT support, which includes managing and enforcing backup procedures. In many cases, assigning a technically savvy administrative person to handle these responsibilities on a part-time basis can result in increased data security risks. The alternative is to assign an IT person for one or more clustered locations, but this carries a high cost which may be hard to justify.

There May Be A Better Way

IT professionals responsible for server administration, application management, database administration, storage systems and network management are continuously looking to reduce branch and other remote office IT support costs associated with backup, recovery and printing, whether they have followed the centralized or distributed approaches. The centralized group would welcome solutions that lower their support and network costs while improving application performance. The distributed group, on the other hand, would welcome a business case that results in consolidating data and servers back to a secure data center environment, while at the same time providing secure and reliable access to the core data center services with negligible computing performance impact. The Gartner Group ("BOBs- Branch Office Boxes Help You Make the Most of Branch Office WANs", Dec 14, 2005) stresses that to reduce overall total cost of ownership (TCO) associated with branch office IT, a "clear cross-functional plan that includes server, application, storage and networking teams" must be embraced.

FSIs need to realize that there is a simpler, lower cost solution that achieves the up until now conflicting objectives of compute centralization, remote site application performance and lowest TCO. The answer is with integrated server/optimization solutions (Gartner calls these Branch Office Boxes). These enable centralization, and accelerate applications including email and file sharing through protocol acceleration and branch office caching for data locality. Security is provided via WAN encryption with support for mechanisms such as CIFS SMB (Common Internet File System Server Message Block) packet signing, client side IPSEC file access and SSL (Secure Socket Layer), for enhanced regulatory compliance. In addition, they provide effective desktop backup and recovery capabilities with increased application performance without the need for WAN upgrades. This minimizes associated remote IT expenses, maximizes business profits while protecting revenue generating IT processes. WAN traffic quality of service (QoS) can be provided on a per application basis, complete with a QoS management service that can automatically change the QoS policy based on time of day to accommodate overnight backup windows. These solutions locally provide print, DNS (Domain Name Services) and DHCP (Dynamic Host Configuration Protocol) services. Extensibility, consistent management and monitoring interfaces for reliable delivery of new applications into branch and remote offices make this a future-proof approach.

This aligns with today's IT strategies, eliminates multiple pain points, reduces overall TCO, securely maximizes remote-site application performance, optimizes fixed WAN bandwidth and is highly extensible for new SSL web-based applications, and real-time applications like VOIP and video. It also provides a degree of location resilience and application availability (a concern with server-less remote sites) through caching technologies that hide the impact of transient WAN outages.

You Need a Business Case

Multi-site financial service institutions, whether retail banks or securities firms, can realize hard financial savings with typical ROIs being less than 12 months and a reduction of network TCO by 50%. This is achieved by enabling hardware and software consolidation at the data center, delivering on user productivity gains from application performance acceleration, reduction of costs associated with WAN upgrades and with supporting point appliances such as WAN and application accelerators. For example, WAN file sharing and backup traffic can each be reduced by up to 90%.

Integrated branch server/optimization solutions enable "IT Lite" or even IT-free branch office environments in a centralized compute architecture, while enhancing the institutions' ability to meet regulatory compliance and maintaining application performance.

Tony Rybczynski is Director of Strategic Enterprise Technologies and Al Lounsbury is Manager of Storage Networking, both at Nortel (www.nortel.com).