Disaster Recovery 101 for Financial and Investment Firms

Disaster recovery is a set of processes in place to help ensure that a business is prepared to recover from a disaster or data loss event and is an important aspect of any business. It is perhaps most crucial for businesses that deal with financial transactions and sensitive data. But what exactly does that mean? What does it look like? Let’s look at exactly what disaster recovery is,  why it is important for financial and investment firms, and what actions should financial and investment firms should be taking to sure up their disaster recovery strategy?  

The Basics of Disaster Recovery

Disaster recovery does exactly what the name implies. When a disaster strikes, organizations need mechanisms in place to recover their data. Typically, organizations might hire a cloud service provider that offers disaster recovery services. The cloud service provider maintains a backup of the organization’s data that is frequently updated. That way, if something happens to the primary data, there is a backup that is ready to go. Disaster recovery is traditionally inexpensive, but many incorrectly confuse inexpensive with "cheap", and thus of little value. The true value of Disaster Recovery is demonstrated when something does go wrong and there is a loss of data. Similar to insurance, Disaster Recovery pays for itself when you can get your data back and in operation quickly.

How it Works

The most common type of disaster that organizations are faced with is natural causes, such as hurricanes, earthquakes, floods, or fires. A natural disaster can take out a data center and the equipment inside, either temporarily or permanently. For a business to continue operating, it needs constant access to its data. Any outage, even one that lasts for a few days, is likely to cause a major disruption to business continuity.

Disaster recovery facilities are typically located far from the primary facilities. The rule of thumb is at least 50 miles, but it is usually wiser to use a backup facility in another part of the world.

With disaster recovery, the cloud service provider will back up the data on a regular schedule. Depending on the terms of your organization's contract, the backup could occur every day, every hour, or even every minute. The goal is to provide a copy of a client’s data in the event that something happens to the main facility.

The Value for Financial & Investment Firms

The average financial or investment firm has a large amount of data that is of high value. From customer information to financial records to proprietary research about the market, a financial firm relies on the use and protection of its data at all times. If a disaster takes that data offline, organizations will not only lose customer trust, but also lose potential business. In a highly competitive marketplace, loss of trust due to carelessness with data is not an option. Disaster recovery is a safe and low-cost option to ensure that never happens.

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