For decades, it’s been widely assumed that highly-regulated industries, like financial services and insurance sectors, can’t use the cloud due to regulatory complexity. This made on-prem legacy systems and data centers the default choice as companies believed they were inherently safer.
But maintaining traditional IT architectures and systems creates technical debt and unnecessary strategic risk. Legacy systems struggle to support both strict compliance and the pressure to innovate faster, driving a wedge between what’s required for governance and what’s necessary to remain agile.
As regulatory frameworks continue to evolve and cloud infrastructure expands, the question for these industries today is no longer if they can use the cloud, but how. With cloud-native environments now a safer, more compliant option than on-prem, executing a successful cloud transformation is crucial to operational resilience.
But many organizations are still approaching migrations and transformations with a “lift-and-shift” approach, creating a strategic disconnect between rapid innovation and robust governance. To effectively bridge this gap, companies need to move towards a comprehensive, enterprise-wide cloud transformation. By modernizing their entire estate rather than individual tools or processes, companies can embed resilience, cost optimization, and AI readiness directly into their operations.
Challenges to Cloud Adoption in Highly-Regulated Industries
While most industries have successfully adopted the cloud, highly-regulated ones are far more cautious. Typically, hesitations surrounding cloud transformation stem from:
- Data residency and sovereignty: Compliance with strict data residency requirements is a priority for companies in highly-regulated industries. Many believe managing on-prem is easier and safer because they know exactly where their customers’ data is stored, eliminating potential uncertainties or legal ambiguities.
- Security and privacy risks: Cybersecurity threats are a huge risk for companies that handle sensitive data. With AI accelerating the speed and sophistication of attacks, companies fear that cloud transformation and dependence on third-party vendors will increase the likelihood of a breach.
- Change management: A transition to the cloud is a huge undertaking. Companies have to be committed to change beyond a “lift-and-shift” approach for it to succeed. It requires team buy-in and executive sponsorship. But this can be a challenge for more traditional industries, which often rely on outdated processes and decades-old, siloed systems. Additionally, for a cloud transformation to be cost-effective, organizations have to have strict financial and usage controls. Fragmented processes make it difficult to manage these, making the cloud appear more expensive than traditional systems.
- Disruption risks: Most mission-critical industries rely on customized, on-prem legacy systems. Migrating to the cloud can feel too risky. If not executed properly, service and business continuity could be disrupted, impacting compliance with regulations like the Digital Operational Resilience Act (DORA) and the Office of the Comptroller of the Currency (OCC).
The Cloud-Native Advantage: Embedding Resilience and Compliance
Ultimately, highly-regulated industries’ dependence on legacy systems creates risk, rigidity, and rising costs, preventing companies from scaling and remaining competitive. A cloud-native transformation solves these issues by treating the cloud as a strategic platform with a diverse set of tools rather than just a storage solution.
Through cloud transformation, companies gain:
- Cost optimization at scale: Maintaining on-prem systems is costly. From hardware to real estate and manual maintenance, most legacy systems don’t deliver the ROI companies want. Strategic transformation lowers cost by reducing tool sprawl and shifting operations into a single solution, often offering a higher ROI.
- Secure by design: Protecting customer data and maintaining a secure environment are the top priorities for highly-regulated industries. Top cloud providers enable companies to shift to a built-in, secure-by-design model. Through transformation, companies get automated access controls, continuous monitoring, and a shared responsibility model.
- Data residency and compliance: A cloud-native estate offers more granular control by leveraging regional hosting and automated compliance frameworks. This makes governance across tools easier, ensuring data is safe and companies are compliant.
- Enterprise-wide operational resilience: Legacy systems often lack the failover capabilities required today. Transitioning to an enterprise-wide cloud estate provides companies with high availability, data recovery, and enterprise-grade architecture, reducing regulatory risk and enhancing business continuity.
- Consolidated tooling and simplified workflows: Transformation consolidates platforms and tooling, creating a solution that streamlines complex workflows. For organizations, reducing silos and increasing efficiency can support change management and cultural shifts, increasing buy-in while modernizing operations.
Transforming with Atlassian Cloud
Not all cloud providers are built the same, but Atlassian’s Cloud Platform effectively addresses companies’ most common hesitations when considering cloud transformation. As a single solution and platform, Atlassian enables organizations to move beyond “lift and shift”, providing a platform that is secure by design and compliant with the regulatory requirements that matter most to highly-regulated companies, such as FedRAMP, DORA, and HIPAA. By integrating Atlassian into a wider transformation strategy, companies can streamline complex workflows, reduce siloed operations, and increase team productivity to deliver real value at scale.
Strategically Redefining Highly-Regulated Industries
By integrating a cloud-native ecosystem such as Atlassian, highly-regulated industries can build systems that are agile, scalable, and flexible. But to be successful, cloud transformation must be thoughtful and strategic. And when looking to accelerate and achieve enterprise transformation, a partner like Valiantys is crucial.
Valiantys’ expertise in cloud transformation for highly-regulated industries ensures every step taken is compliant and value-driven. Along with implementing the right solution and assisting with cloud migration, our Precision Framework ensures your transformation is tailored to your business needs and goals.
Our approach consists of three phases:
- Define: Before moving forward, we create business use cases, value maps, readiness assessments, and transformation roadmaps to ensure alignment across an enterprise.
- Build: Based on your business goals and needs, we move beyond simple tech upgrades by designing and implementing solutions that drive value and ROI, connect tools, and modernize workflows while maintaining compliance, governance, and operational resilience.
- Run: Our consultative services aren’t one-and-done; we continue supporting an organization to ensure the cloud continually delivers measurable value, including gains in resilience, efficiency, and the ability to adopt new technologies like AI.
With Valiantys’ approach, highly-regulated companies can fully embrace a cloud-native strategy to manage complex regulatory requirements while accelerating scaling and innovation seamlessly. We ensure your cloud transformation eliminates technical debt, streamlines workflows and architectures, and creates scalable implementations across an enterprise to maintain a competitive edge.
Ready to evolve your enterprise with Atlassian Cloud and Valiantys? Connect with us today.