Fintech

Case Discussion
Gartner AI Hype Cycle-2024
When should a manager/decision maker choose
to adopt a technology out of the five phases?
Fintech- Background
• Fintech was a Tampa based company which processed electronics
payments and reported U.S. wholesale distributors and retailers of
alcohol
• To continue to exert technology leadership, Fintech intended to
offer a service that would make it easier to derive data driven
insights for their customers.
• This would be the company’s first move into the cloud.
• Focused on EFTPS
EFTPS Process
• Wholesaler deliver alcohol to retailer
• (Using Electronic Fund Transfer Payment System) Wholesaler creates
and delivers invoice to retailer.
• Retailer receives invoice and authorizes payment.
• Fintech withdraws funds from retailer account and electronically
transfers payment to wholesaler within the required time period. If
there are insufficient funds into the retailer account, Fintech pays the
amount due to the wholesaler (and retailer subsequently pays
Fintech).
• Wholesalers reports this Sales of Alcohol to Retailer by required date.
Problem
• What is the problem currently faced by Fintech?
• Data Integration is the major challenge

• Producer might sell – “Kwo’s Beer” as “Kbeer” within BRAND attribute

• Wholesaler might store the same as – “Kwos Beer” within BEER-BRAND
• Retailer might list- “Kwo’s Beer” within B-BRAND attribute

[can solve this by Primary Key and Foreign Key]

Fintech Goals
• Strengthen Fintech's relationship with its customers
• The cloud can be seen as an opportunity to continue to exert
technology leadership
• Once cloud provider was chosen, Fintech would need to consider how
to launch, run, and manage the new service in a way that would
strengthen Fintech's relationships with its customers and minimize
cloud computing risks
FinTech- IT Staff Capabilities
• Network Administration
• Security
• Database Management
• Custom Application Programming
• Hardware Support
• Project Management
• Analytical Report Development
• Software Support
Fintech Developers
• Integrated Development Environment (IDE) based on Visual Studio for
some projects
• Hire Outside Consultants with the right expertise
• Both proprietary software and locally customized packaged software
were used, including many Microsoft products such as Microsoft SQL
Server
Customer Expectations
Prefer to work with Fintech data in one of the two formats-
(1) Access the data directly, using some type of data access tool to
consume into their own local database for analysis. Example- .sav (spss)
(2) comma-separated value (csv) file, so they can consume the data
into Microsoft Excel for analysis.
Cloud Computing Features
• Pay-as-you-go
• On Demand Services
• Resource Pooling
• Ubiquitous computing
• 3 Types: SaaS, PaaS, IaaS
Cloud Computing
• Software as a Service (SaaS)- software is accessed online via a
subscription, rather than bought and installed on individual
computers. You can install also in your computer. Example: salesforce,
Microsoft Office
• Platform as a Service (PaaS) -the provider would provide you
computing platforms which typically includes operating system,
programming language execution environment, database, web server
etc. Example: Google App Engine, Colab
• Infrastructure as a Service (IaaS)-IaaS providers would provide you the
computing infrastructure, physical or (quite often) virtual machines
and other resources like virtual-machine disk image library, block and
file-based storage, firewalls, load balancers, IP addresses, virtual local
area networks etc. Example: Amazon EC2
IAAS, PAAS and SAAS in travel industry?
• Think about Travel Agent
SaaS, PaaS, IaaS in Gartner Hype Cycle
• Exhibit 4
Factors to Consider
• Technical Factors
• Programmability
• Database support
• Scalability
• Economic Factors
• Initial Price
• Complementary investments
• Total Cost of ownership
• Human Factors
• Availability and skills of local IT staff
• Availability and skills of provider
• Availability and skills of consultant employed
• Strategic Factors
Concerns Related to Cloud
• Data breaches
• Compromised credentials and broken authentication
• Hacked interfaces and API's
• Exploited system vulnerabilities
• Account hijacking
• Malicious insiders
• The APT (Advanced Persistent Threats) "parasite"
• Permanent data loss
• Inadequate diligence
• Cloud service abuses
• DoS (Denial of Service) attacks
• Shared technology, shared dangers
Top 3 Choices
• Amazon
• Google
• Microsoft
Provider Evaluation: “Use Case”
• Extract: Each day's transaction data (captured in EFTPS transaction
databases) would be copied to an Oracle Data Warehouse, which would
also contain relevant master data (such as product name, ID, and
attributes, and wholesalers or retailer name, ID, and location).
• Load, Stage, Process: For a particular Fintech client, specific data would
then be loaded into the cloud-base solution for staging and further
processing. Processing required some custom programming, because of a
proprietary Fintech algorithm in the EFTPS system. The processed data
would be transformed to a format compatible with the client company's
database.
• Release: The processed data would then be made available to the client,
subject to secure and specific user access controls.
Provider Evaluation: Offerings
• Training: Aiming to expand IT staff's cloud-related expertise
• System Administration Support: Fintech IT staff would administer and maintain
the cloud-based solution.
• Customer Support: Customer support would be supplied either by local IT staff or
a service provider. Needed to be timely and at the highest professional standard.
• Data and System Availability: Ease of client's access to their authorized data and
high system availability ("up-time") were key requirements.
• Security: Fintech had a solid history of providing secure access to its proprietary
data
• Programmability: Fintech would apply proprietary algorithms to the data as it was
processed in the cloud. Testing and implementing these algorithms - whether by
local IT staff or consultants - needed adhere to very detailed specifications.
Provider Evaluation: Similarities
• All the providers has trained many consultants on their products; certified
professionals were available around the world.
• Each cloud platform integrated with an IDE (Integrated Development
Environment) and a Source Control System.
• Offered extensive development support on multiple operating systems and
devices, and Software Development Kits (SDK) that supported multiple
programming languages.
• Multiple training vendors supported each option, and each provider also
offered its own online training resources and exams.
• Offered a pricing calculator to help customers estimate monthly or yearly
costs.
Evaluation
• Is One Cloud Service Provider better than Other?
Determining the Difference
• Step 1 is common for all the 3 service providers
• Step 1: Visual Studio and SQL Server Data Tools were used to create a
SQL Server Integration Services Package (SSIS).
 Microsoft Google Amazon Web
Azure Cloud Services
Platform
Step 2 SSIS Package SSIS Package SSIS Package +
+ MS OBDC + MySQL 3rdP tool →
→ Azure SQL OBDC → AWS S3.
Google Cloud AWS S3 + 3rdP
SQL RDB tool → AWS
RDB/Data
WareHouse
Step 3 Client has Client has Client has
secure Azure secure secure AWS
user + host Google user user + host
controls via + host controls via
MS ODBC controls via AWS
Connection MySQL JDBC/ODBC
JDBC/ODBC
Microsoft Azure
• Step 2: Use SSIS with MS OBDC Driver to load, stage, and process data
into MS Azure SQL.
• Step 3: Client, using MS Azure User and Host access controls, accesses
data via secure MS ODBC connection:
• Key Observation: Use Azure's SQL database to migrate data for many
existing applications to the cloud. It is more expensive than Amazon
and Google, but less expensive than the current on-premise licensing
cost for Microsoft SQL Server. Microsoft calculates computing
performance base on Data Throughput Units (DTUs)
Google Cloud Platform
• Step 2: Use SSIS with MySQL ODBC Driver to load, stage, and process
data into Google Cloud SQL Relational Database.
• Step 3: Client, using Google User and Host access controls, accesses
data on Google Cloud SQL via secure MySQL JDBC or ODBC
connection.
• Key Observation: An increase to the Google Cloud SQL database
instance to 16 virtual CPUs. Despite this, the cost was lower than
Microsoft Azure and about the same as AWS. Cannot accurately
calculate long term cost savings.
Amazon Web Services
• Step 2: Use SSIS with third party tool to load into AWS S3 for staging.
USe third party tool to extract data from AWS S3 and load and
process into AWS Relational Database or Data Warehouse.
• Step 3: Client, using AWS User and Host access controls accesses data
on AWS via a secure AWS JDBC or ODBC connection.
• Key Observation: AWS offers persuasive evidence of Redshift's which
is a data specialized for data warehousing. Similar to Google had to
expand the database instance to 16 virtual CPUs. Purchase a
thirdparty tool to load test data into AWS, but it integrated nicely with
out existing extraction packages. Offers a lower support cost than
Google and Microsoft. Amazon's support is significantly cheaper.
Discussion
Look at the Exhibits
• Exhibit 6

• Exhibit 7

• Exhibit 8