| 2.3.14. Risk Management: | | ISO 31000 defines the role of the Risk Manager as measuring the effects of uncertainty of objectives. The primary mission is to operate the very best possible cloud computing infrastructure so risks are minimised and much less than any alternative scenario. | | The methodology we use is to document all threats with practical and economic solutions - then choose the best where the best is defined by customer service level agreements - what the customer is willing to pay for. |
| Threats: | | The ISO guide 73 standard has defined that risk is the "effect of uncertainty on objectives". We like to keep things simple and document risk as any threat that could impact on our business, and by definition, that includes any impact on our customer busiensses. |
| Risk Classification: | | Please expand on the following risks: | | Physical buildings housing the Infrastructure - our Facilities Managers role. | | Financial Stability, Takeover. | | Electric Power Supplies. | | Broadband Connections. | | Privacy. | | Accident, Health and Safety. | | Terrorist, Riot, Fire or Flood Disaster Recovery - our Business Continuity Managers role. | | Social and Competitive Risk. | | Environment and Carbon Footprint. | | Insurance and Liabilities. | | Data, Information and Knowledge; Data Protection Act; ISO 26000. | | Security - our Information Security Managers role. | | Compliance - our Compliance Manager role. |
| Trust: | | It has to be accepted that a lot of the traditional IT industry is deaply concerned that cloud computing will be the end of IT as it has existed for so many years. In the same way as factories replaced steam engines with electric motors from an electric service provider one hundred years ago, companies will replace in-house IT infrastructure with cloud computing services. By definition, a company that is in the retail, finance, transport or manufacturing business is not in the IT business and will eventually outsource all its computing service requirements. | | If you were an IT professional looking at the end of your in-house career path, you would be crying security concerns, but in practice, dedicated cloud servers in tier IV data centers is many times more secure than any in-house data storage farm. It is just a matter of time, cloud computing is so much cheaper and more secure and more flexible and has elastic capacity and can operate from any location and can safely use any kind of computer, smart phone or tablet - the benefits are overwhelming. |
| FAQ: | | But I do not know where the data is. Correct, that is a dramatic improvement in security, your business data is less likely to be subject to terrorist or targeted criminal attack. | | But the Cloud company may cease to trade. Correct, just like your in-house hardware, network or software vendors; or electric, Internet or air conditioning provider. Do you have your own standby electric generators in case power goes down, do you have a fully duplicated set of infrastructure in another remote secure location, do you have all your data safely replicated to at least one other physical location? | | But my company have unique requirements. With the UK Government G-Cloud application shop initiative to mirror the EU Cloud market initiative and USA Government Cloud initiatives, if your requirements are so diferent, then your company has an IT problem. |
| Physical Risk: | | The easiest way to understand the rapid migration from traditional IT to cloud computing is by comparision of physical infrastructure risks. We begin with where we have operated IT for many years and then compare with our new data centers. |
| Physical - Traditional: | | A typical IT department has a room in the office to house the IT servers and related infrastructure - the computer door will be locked. The physical location of the office is published for terrorists and criminals to plan a physical attack to remove all the servers and valuable business data. In most cases, the computer room is not protected with an internal steel cage and the office may not be manned all the time. | | Let us take Deutsche Bank in London (Nov 2000) as a typical example, it had a computer room on the first floor. At lunch time on a Friday, about 20 masked men carrying hammers and cutting equipment, they pushed past reception, smashed the computer door down, cut out each server and physically emptied the computer room in a few minutes. By the time the police arrived, 100 people in the office were in a state of shock they they had not understood what was happening. The cost of the servers was one million pounds, but not as significant as a loss of all active data that the criminals now had full access to. | | Many other examples are known where criminals physically emptied a company of all its computers over a weekend, but it is the loss of all that business data that is the most significant factor. |
| Physical - Data Centers: | | We rent space in purpose built tier IV data centers that house the UK Internet backbone. To minimise risk, the physicl location of these buildings is not published and the buildings do not have any external signage. | | Each tier IV data center will house many thousands of servers in a lights-out secure environment that is always manned with very restricted physical access. High security fences, CCTV and ram-proof barriers are many times more physically secure than the average office. | | A reason that so many companies are now evolving to the cloud using professional data centers is because physical risks are so much less than any traditional in-house computer room. |
| Financial Risk: | | The long term stability of the seller can be enhansed by the buyer making fair and reasonable payment in advance. Where costs are cut too fine, the long term stability of the cloud application service is put at risk. Where costs are too much, the cloud application service can be purchased from others so the service is put at risk. | | We are backed by a venture capital business that ensures that long term stable investment decisions are rewarded with continual revenue steam. As each customer can pull out at any time, so the only reason a customer will keep on making payment is where the quality of service remains cost effective. Our role is to set sensible prices that are considerably less than any in-house cost of doing business. Stability is delivered by limiting all liabilities to the last months payment and by suitable professional indemnity insurance. | | Each customer has the right to make more demands that are paid for with higher professional indemnity premiums. Where a customer does not need to impose liability demands, then costs can be reduced to what is a fair and reasonable amount. |
| Takeover Risk: | | As private companies we cannot be subject to takeover bids from rivals or competitors. Our long term stability is ensured with the people running the company, owning the company. |
| Data Security Risk: | | This is the top threat quoted by IT people who are not as well informed as they should be. In practice, any in-house security precaution will have been replicated by our cloud infrastructure and our cloud infrastructure will have several security benefits that cannot be enjoyed by in-house security teams. Internal and external penetration testing to PCI-DSS standard can be identical for cloud and in-house applications, so data security threats are never greater with a cloud solution. | | Advanced Persistent Threats (APT) target in-house servers where hundreds of client computers are connected - a vulnerability in any one client is enough to load a trojan into an in-house server that simply exports crttical business data each day. Indications are that in-house IT staff have no idea when they have a infection that is silently exporting business data each day - data that has considerable market value. |
| Data Security - Three Tier Architecture: | | The key reason that our cloud computing applications are secure is our "Three Tier Architecture". First, our web servers are connected to a load balancing firewall that has no other computers connected. Email and user downloaded programs cannot impact on the security of our web servers. Second, our web servers are private firewalled to a set of application servers - these application servers are not connected to the Internet and cannot be hacked. Third, our application servers are private firewalled to our database servers - these database servers are not connected to the Internet and cannot be hacked. | | It is suggected that 90% of companies with in-house servers cannot afford to employ this very secure Three Tier Architecture. While in-house company data is hacked every day, it is not possible for our database servers to suffer from a normal hacking attack. |
| | | Electric Power Risk: | | The traditional in-house IT department will have its IT infrastructure running from normal office electric distribution panel and its air conditioning part of the normal office air conditioning. A computer room may have Halon gas fire suppression, but the effect of this when the office is on fire will not be for a long time. It would be very unusual for an office to have its own standby electricity generator. Most IT departments are obliged to accept that the risk of power disruption means that all business must stop. | | We employ tier IV data centers that by definition have more than one independent power supply and a backup generator. Yes this is more expensive than the average company can cost justify, but a tier IV data center splits its infrastructure costs between thousands of customers. | | A reason that so many companies are now evolving to the cloud using professional data centers is because electric power supply risks are so much less than an in-office computer room. |
| Disaster Recovery Risk: | | A disaster would be where the IT infrastructure is no longer usable because of terrorist, riot, fire, flood or other reason. | | The in-house IT department needs to rent a remote computer room and replicate all hardware that can be used in the event of a disaster. A few companies can cost justify to have a second computer room, but how long would it take for such a remote location to become operational? Business continuity may be delays for some days in the event of an in-office disaster. | | We rent space in many remote data centers in different parts of the UK. In the event that one data center is no longer operational, in a few moments, another data center can take over and continue the business. We operate data replication message switching between data centers so data is continually flowing though encrypted tunnels to other locations. | | A reason that so many companies are now evolving to the cloud using multiple data centers is because disaster recovery risks are so much less than an in-office solution. |
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