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Colocation Helps Organizations Face the Challenges of Transforming IT infrastructure

An upcoming bank based in a prosperous town in western India planned to go for a complete transformation in terms of range of service offerings and overall efficiency of operations.

Transforming IT infrastructure- major hurdles

The need was to design a robust strategy that would be used to revolutionize business processes with an aim to enhance customer gratification and to meet diverse demands of internal as well as external customers.

The entire strategy had to rely on state of the art IT technology the whole IT team sprung into action and embarked upon a seemingly daunting task of changing the bank’s infrastructure for better.

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The existing IT infrastructure consisted of a server room at the central office to host basic Core Banking Software and other routine application. The central IT infrastructure was designed to serve seventy five branches that were networked with help of point to point connectivity.

The major hurdles faced by the bank were related to bottlenecks due to limited IT resources, in addition to lack of scalability and reliability. Needless to mention, these issues were responsible for the stunted growth of the bank.

It appeared that the CIO had his dish full of issues with need to embrace new technologies and imparting training to employees for adapting to the cutting edge IT solutions.

It was observed by the CIO that the entire gamut of activities needed to be categorized into three vital buckets as under:

  • Creating a robust IT infrastructure that is capable of scalability and is reliable for operating financial transactions
  • Incorporating the most modern business applications that can accommodate diverse needs of the proposed transformational journey
  • On-boarding proficient IT manpower to handle new generation IT infrastructure

Idea of setting up a dedicated on-premise data center was quickly discarded due to the huge costs involved for building the physical infrastructure, hardware purchases, procurement of networking components, and architectural planning to name a few. Bank’s financial and human resources could not cope up with operations of such a mammoth scale.

Relevance of colocation for the banking institution

This was the moment of enlightenment and the CIO realized that the answer to most of the problems related to IT provisioning could be found in ‘colocation’.

Outsourcing was indeed the key to all problems faced by the bank and its management that was lacked required expertise and financial resources to run in-house data center facilities. Outsourcing bank’s IT requirements to the right service provider that had all the resources and expertise was the most perfect solution.

Colocation proved to be the right hosting solution for this bank as it resulted in massive savings in terms of money as well as time. The bank was also able to design a customized solution that improved overall efficiency by enhancing flexibility of cash flow management.

The most significant advantage of colocation for the bank was cost efficiency of the utility based colocation model. It was possible for the bank to channelize the funds more effectively for business growth.

Key benefits of colocation

Availability resources- Any data center facility cannot run efficiently without assurance of seamless power supply. In-house data centers face frequent power outages and are not prepared to handle such events due to multiple limitations. This is more relevant during the stage of capacity upgrading. Colocation data centers are equipped with redundant power and other resources. These facilities have additional provisions of power supply such as diesel and battery operated generators. The power per square foot ratio of colocation facilities is way above the standard in-house data centers.

Uptime guarantee- This is one area where private data centers fail miserably. Mission critical operations such as banking need guaranteed network uptime for reliability of services. Reputed colocation providers provide over 99.95 percent uptime guarantee backed by Service Level Agreements. In addition to this, clients are free to choose their preferred telecom provider from a large assortment of service providers from these carrier neutral facilities for colocation.

Business availability and reliable Disaster Recovery It is hard to predict disasters. These can present in the form of cyber threats, snow storms, earthquakes, fire, and prolonged power outage to name a few. Colocation provider provide facility of off-site servers that can offer failover capabilities and maintain the business continuity. There are multiple DR solutions in place to retain business critical data.

Security of data- In a business scenario, data is the most important asset that is vulnerable to repeated attacks from malware and is exposed to unauthorized intrusion attempts. Data breach can spell doom for many a organization. Mission critical data is protected by using multi-layered security provisions and presence of firewall and so forth.


Whenever the existing in-house data caters face repeated breakdowns and downtime, CIOs must initiate steps to upgrade these facilities by adopting server colocation hosting services. Every business has its own priorities and accordingly a plethora of options are available to choose from.

CIOs are entrusted with the decision making process to choose the right IT provisioning solutions that cater to the organizations needs. Colocation has been found to be the most logical choice of many a CIO. It is reckoned as a cost effective and flexible solution by its users.

About Chhaya Jaiswal (54 Posts)

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