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The Hype around Big Data – What’s it all about?

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corp - global banking finance

Conrad Constantine, Research Team Engineer, AlienVault

Why is everyone so hyped over Big Data?corp - global banking finance

Possibly it’s because people are now realizing the power of Big Data.

The security industry has realized that log data is an incredibly rich source of information for detecting security intrusions, and has since developed a taste for more and  more logs.

Log Correlation has since then followed as IT professionals realised that individual log entries by themselves meant very little, but when placed into context against one another illustrated more than just system-level events. They illustrated behavioral context — clusters of individual log lines which could be translated into records of human-readable actions.

Security is still in the early days of this science and practice of event correlation: Methods and results are rarely shared with the community, the target for what is effective keeps moving, and yet we’re already talking about Big Data.

Terror and Possibility
This is of course, the intersection of terror and possibility, as we transition from our first fumbling attempts to boil the ocean into a land populated by people who have been doing this stuff for a long time before us.

Vast databases of information being mined for emergent patterns and used to process simulations over and over are hardly new to the world — the finance, medical and aerospace industries have spent years in this realm. How is it, then, that the security world has not previously tapped into this pool of expertise before now to help us glean the knowledge lying dormant within our vast supplies of data? Quite simply, it’s because we still don’t know what questions to ask in the first place.

What’s Out There?
It’s worth performing a short recap on emerging Big Data technologies out there and why they differ from being just “large databases.” Although there are many implementations of these technologies, they all derive from two core functions: NoSQL and MapReduce.

NoSQL is a difficult beast to define even among the experts in that field. What you need to know up front as a security practitioner, however, is that NoSQL can be defined by:

  • Lack of strongly structured schemas. Unlike an RDBMS, where the schema must we well-defined before data is stored and changes to that schema when live data is present becomes increasingly more unfeasible, NoSQL data stores may freely adapt the nature of the records they store over time.
  • As the name implies, the SQL language is not used to retrieve information from these systems — many systems implement Javascript (JSON and BSON) to perform data queries.
  • They are optimized for rapid retrieval of information at the possible expense of consistency of data (they do not comply to ACID). To wit, they are excellent systems with which to do analytical work but have inherent issues if treated as the authoritative repository.

Accordingly for the same audience, MapReduce’s key features are:

  • The ability to perform information retrieval and calculation over a widely distributed data storage. A practical example would be that if individual devices had their log storage implemented in a MapReduce-capable manner, then a centralized log storage mechanism may no longer be required — a single query could be performed across all logs on all devices simultaneously.
  • Inversely, a centralized storage may still exist but spread out over a computing grid of commodity hardware (indeed, this was the reason for Google’s (Nasdaq: GOOG) creation of MapReduce).
  • Generally speaking, there is comparatively little need for the end-user to optimize their query sets to take advantage of MapReduce’s distributed nature.

So, we can immediately see some of the reasons these two technologies have raised excitement and promise to the information security world:

  • Increased speed on complex queries across large quantities of data is a vital force-multiplier for security analysts; the ability to query every machine that has accessed a particular URI in the last 90 days in minutes (not hours or even days) cannot be overlooked.
  • The flexibility to bring additional data to supplement existing records works in lockstep with the inherent nature of security information: that it is comparatively a domain of unstructured data. Freedom from data schemas that fail to take into account the information that is vital to the organization we are trying to defend will allow us to make better correlations and ask better questions from our data.

Between these two factors, we can see where the excitement comes from, and yet we still have to return back to the same issues we’ve struggled with before the advent of Big Data.

What Do You Want to Know?
We still aren’t very good at asking the right questions from our data.

In security analytics, it’s often the relations between the data (not the data itself) that is important. Just as detective work is a matter of “connecting the dots,” so are the relations between our data points for the true information (Log Correlation itself is about looking for and exposing those relations).

As IT professionals, we share a particular reticence to trust anything we didn’t do hands-on ourselves; as security professionals, this trait becomes magnified. Perhaps the fact that the concepts we are looking for (exposures, risks, threat surfaces) are so difficult to define that we are still stuck in the stone ages of bar charts and keyword searches when it comes to data analytics.

No amount of Big Data is going to save us until we can learn to formulate better questions for that data. Perhaps it’s time that we accepted that the problems we’re approaching now (trying to boil an ocean of data points into digestible information) is not unique to us. Information security as a discipline may have much to learn from other technology fields. It’s a tough pill to swallow when you think of how much we collectively berate the rest of IT as being the source of all our issues in the first place.
Biology Lesson

I’ll cut to the chase here: BioInformatics.
Bioinformatics places emphasis on discovering the nature of interactions and relations between their points of data, since this is intrinsic to how biology operates too. It won’t take long before you find a plethora of advanced (and aesthetically pleasing) visualization techniques being used to present and explore data relations, like the CIRCOS system.

BioInformatics has made great strides in distilling down complex data relationships into advanced visualization techniques that maximize the ability of human pattern recognition abilities to discern inferences that are difficult to make programmatically.

Ask better questions, discover relationships, create hypotheses and test them against more data; rinse, repeat — the scientific method.
Big Data will not magically enable us to discern better answers until we come up with better questions to explore the relationships between our data more thoroughly.
The field of log correlation could make great strides if were we to establish an open format for exchanging ideas for correlations in a vendor-neutral manner and collectively discuss what is effective within the field instead of how we operate today.

Information security is evolving into areas well explored within other fields. Our issues with discovering relations and implications from our oceans of unstructured data are at the heart of the field of complex event processing.

We’re moving into territory where we are not as alone as we think; if we are going to reap the benefits that Big Data promises and not let this become another failed fad, then we have to start overcoming our isolationist attitude and start inviting experts from other disciplines to join us and teach us how to use this new toolset.
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Financial transformation is the new digital transformation

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Financial transformation is the new digital transformation 1

By Luke Fossett, ANZ Head of Sales for global recurring payments platform, GoCardless

The term ‘digital transformation’ has become somewhat synonymous with COVID-19. As teams and operations became decentralised, companies looked to quickly build their remote tech stacks, striving for ‘business as usual’ despite the circumstances.

But in the background of COVID’s chaos, different regions and industries experienced major changes, sparking a different breed of transformation beyond the digital spectrum.

Take Australia as an example. In July, the market saw the local arrival of Open Banking, as well as further detail into the regulated and planned transition away from the existing Direct Debit system to the central-backed New Payments Platform (NPP) and it’s Mandated Payment Service. With these changes comes the impetus for a wave of ‘financial transformation’; a term that describes the process of making financial operations, processes and outputs more efficient.

Despite its potential for broad interpretation, financial transformation has the potential to produce use-cases that drive value for the customer; from things like seamless payment experiences, to data-rich APIs and integrations, to managing real-time bank to bank payment and the automation of everything from customer acquisition to using data to retry a failed transaction on the date that gets the best success. These innovations are well within reach for enterprise organisations, however, to extract real value, business leaders need to plan their financial infrastructure in parallel with making digital investments.

With the right deployments, financial transformation can reap significant rewards from a customer and internal operations perspective – so here’s why business leaders should be paying attention:

Value speaks volumes to the C-suite 

Financial transformation benefits enterprise organisations as well as small and medium-sized businesses (SMEs) that need to create efficiencies as they scale, but translating its value is not always easy.

Payments are a complex part of any business, impacting many different consumer-facing and internal functions. Yet the role of ‘payments specialist’ is a rarity in most organisations.

Responsibility for financial transformation often falls – and gets lost – somewhere between the Chiefs of Technology, Information and Finance. That’s why leaning on platform providers and payments experts as early as possible, is key to understanding your customers and capabilities, before you implement and invest.

Outsourcing financial transformation initiatives is a much easier sell to enterprise decision-makers than redirecting IT resources to new DevOps projects. Credible payment providers, and the specialised knowledge that comes with good ones, are in most cases a more cost-effective solution than employing a full-time expert. Translating the value of financial transformation to achieve buy-in from the C-level boils down to maximising efficiency and return on investment (ROI).

A simple solution is using automation for tasks like streamlining processes, such as collecting payments on time without human contact. Find the sweet spot between how you want your customers to pay, and how they prefer to pay; then offer those options, while making sure they can be done with little to no touch internally.

Fintech-led transformation 

‘Best-in-class’ platform providers typically describe innovative fintech companies, who, as opposed to generalist banks, are deemed specialists in niche elements of financial services.

Again, using the example of Australasia, there are nearly 5,000 active fintechs, and it’s a market that legacy-laden big banks are tapping into. For example, Australia’s largest bank, the Commonwealth Bank of Australia, recently partnered with venture capital firm Square Peg, and AI-focused capital fund Zetta Ventures Partner;  pouring $AUD28 million into new financial technology that delivers better digital banking services to its customers.

Fintech-led transformation doesn’t only have to benefit the customer; it can offer significant value for financial teams too.

In an enterprise environment, choosing the right technology allows for slick front end payments, but the true value comes in optimising financial management behind the scenes.

Take the rising consumer demand for subscription services as a use-case. According to Zuora’s Subscription Impact Report, 50 per cent of all subscription companies are growing just as fast as they were before the pandemic, while 18 per cent are actually seeing subscriber growth rates accelerate. With this trend comes a rise in companies looking to invest in recurring billing platforms that make it easy to accept regular payments, however, finding a low-touch platform that offers the financial infrastructure to support subscription-based payments will generate much greater ROI. There is no point blowing budgets on a ‘rip and replace’ billing platform if internally, finance teams still have to revert to a manual process of uploading payment files in a spreadsheet.

The future is financially transformed

The Reserve Bank of Australia’s latest Consumer Payment Behaviour survey shows that in 2007, cash was used for 69 per cent of all transactions, while last year it accounted for just 27 per cent. Additionally, over 50 per cent of Australian businesses prefer bank-to-bank payments, known as Direct Debit, over credit cards as a way to collect payments.

Payment preferences are rapidly evolving, and keeping up with consumer payment trends is key to staying competitive. To be effective, however, you need to have the infrastructure to support and accept diverse payment methods.

‘Payments as a Service’ (PaaS) is a phrase used to describe platform providers that connect multiple payment systems, enabling companies to offer several payment options while replacing outdated practices like paper-based Direct Debit.

In 2020, the most successful enterprises are utilising PaaS providers, built for self-serve and high rates of conversion. Take Bulb, for example; the UK-based energy company allows users to sign-up, switch energy providers and lock-in their payment preferences, all in under two minutes. Better yet, the process requires almost no people management.

Taking a visionary lens on financial transformation means building greater payment efficiencies for both the customer and the enterprise. Additionally, the specialist and agile nature of fintech platforms puts the organisations who use them on the cutting-edge of innovation, future-proofing operations in a fast-moving market without significant investments in research and development.

Best-in-class platform providers are driving financial transformation change; helping business navigate and plan so they are prepared for today, and for what’s coming.

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RegTech 2020: Exploring financial crime and the emergence of RegTech in the USA

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RegTech 2020: Exploring financial crime and the emergence of RegTech in the USA 2

with host, Alex Ford, VP Product and Marketing, Encompass, and guests, Dr Henry Balani, Head of Delivery, Encompass; Pawneet Abramowski, Chief Compliance Officer

Today, financial institutions deal with increasingly complex transactions and regulations that are continually changing. For the financial services industry, the cost of regulatory obligations has dramatically increased in recent years and, as a result, there has been a strong demand for more efficient reporting and compliance systems to better control risks and reduce compliance costs.

The complexity of regulation has made it more difficult for compliance and legal teams to manage risk. Also, the rise in large monetary fines, the impact of reputational damage, personal liability and even prison sentences have all played a factor. However, it remains essential that RegTech and AI is not seen as the only answer to addressing all financial crime risk, but rather a tool that, if used properly, can create more efficiency in the management of money laundering, bribery, corruption and fraud.

This month’s insightful and thought-provoking RegTech 20:20 podcast, from Encompass Corporation, delves into these topics from a US perspective, as guests, Dr Henry Balani, Head of Delivery, Encompass, and Pawneet Abramowski, Chief Compliance Officer. Pawneet has more than 17 years of combined experience in both public and private sectors with a focus on compliance and Henry has experience supporting innovative technology solutions that address issues of financial crime and money laundering. He advises technology firms as a Non-Executive/Board Director.

Encompass Corporation aims to demystify RegTech for listeners and understand what practitioners and experts are doing to overcome organisational challenges. This time,

Pawneet discusses how the US is at the forefront of the utilisation of technology, while also reflecting on the long history of money laundering and financial crime there, saying that “the birth of RegTech in the last 5-7 years has been really prominent in the United States”.

Henry, having had more than 25 years’ of financial services industry experience, speaks about how so many transactions worldwide are cleared in a US bank and how the US dollar is a powerful weapon, especially when money laundering comes into play.

When asked about her thoughts on technology assistance, Pawneet suggests that organisations are having to continuously evolve their programme and controls, telling the audience: “I think that’s where this desire for having technology assist in making things more efficient and operationally effective”.

Henry gives listeners an insight into regulatory penalties being a driver in changing behaviour, suggesting that this type of enforcement is a successful method.

 “…as we see the increasing use of these penalties, organisations are noticing the reputational damage as embarrassing. We have seen a lot of these companies coming to RegTech firms asking for solutions to help them identify these potential challenges and issues”

Later on in the podcast, he goes on to speak about the challenges for regulated banks in the US. Breaking down the latest data and survey figures, Henry insists that the US has huge workforces in this organisation of growth. “To be a compliance professional, you are certainly in huge demand.”

Technology advancement is increasing at a rapid rate in the US. Regulated firms have a challenge not only to stay ahead of criminals, but there is often a rush to introduce new technology and continue to improve the experience of customers. Regulated bodies in the US, especially banks, have long been reinventing and adapting their compliance programmes to meet both their legal and community obligations and, as Pawneet explains, “it feels like a constant regulatory revolving door as a compliance professional”.

More expert commentary, RegTech conversation and industry insight can be found in the full episode of RegTech 20:20. You can listen here  https://www.encompasscorporation.com/regtech2020-podcast/, and across all major podcast players

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86% of UK businesses face barriers developing digital skills in procurement

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86% of UK businesses face barriers developing digital skills in procurement 3

A shortage of digitally savvy talent, and a lack of training for technical and soft skills, hinder digital procurement initiative

Research from Ivalua, a leading provider of global spend management cloud solutions, has shown that a majority of UK businesses (86%) face significant barriers developing digital skills in procurement. The findings reveal that a shortage of digitally savvy talent (31%), a lack of training for technical and soft skills (28%) and a lack of understanding of the skills required (13%), are some of the main barriers preventing UK business from developing the digital skills they need. Additionally, over half (55%) of UK businesses say that digital skills in procurement are less advanced compared to other departments

The research, conducted by Vanson Bourne on behalf of Ivalua, surveyed 200 UK-based procurement, supply chain and finance professionals about the true nature of digital skills within procurement, and the challenges businesses looking to digitally transform will face. More than eight-in-ten (84%) UK businesses believe that the skill set required of procurement professionals has shifted from procurement-first to digital-first. The study also highlighted that most respondents believe that greater digitalisation (84%) and better digital skills (83%) in procurement would have enabled UK businesses to mitigate the impact of the COVID-19 outbreak more effectively.

“Over the last decade, the role of procurement has transformed from one of cost-cutter to a vital ally that can help inform and enable a business’s strategy. The global COVID-19 pandemic accelerated this trend even further, reinforcing the importance of procurement as businesses adapt to the new normal,” commented Alex Saric, smart procurement expert at Ivalua. “However, for too long, procurement has been seen as a digital laggard, with technology adoption trailing behind other departments. In order to keep its seat at the table in strategic discussions, procurement must ensure it has people with the right skills in-house, as well as easy to use technologies, or risk being unable to offer significant strategic value.”

Challenges in hiring digital skills in procurement

As part of ongoing digital transformation efforts in procurement, the report found that UK businesses have started to introduce new technologies such as data analytics (55%), cloud-based platforms (53%), automation (35%) and AI/machine learning (30%) in the last 12 months.

But when it comes to deploying these technologies, UK businesses are finding it difficult to complement them with the digital skills required. The study found that 88% find it challenging to hire the right digital skills to work with technologies such as AI, cloud-based platforms or data analytics, while 76% say they are concerned that existing procurement teams will struggle to work with new technologies. Developing digital skills is vital for businesses, as 91% of respondents say that improving digital skills can make procurement more strategic, while 94% say it will help them gain a competitive advantage.

“In a rapidly evolving business environment, digital skills are essential for procurement teams to analyse and mitigate risk, identify new opportunities and collaborate with suppliers. However, procurement teams are struggling to both attract digital talent and upskill existing teams, which puts them at risk of falling behind competitors, losing market share, and struggling to identify risk and opportunities ahead of time,” comments Saric.

“To address the digital skills gap in procurement, UK businesses need to ensure they are focusing on adopting tools that are easy to use and improve access to actionable insights. By making procurement smarter, businesses are giving teams the tools and skills needed to thrive in the new normal, allowing the business to react and proactively address the shifting sands of a post-COVID world.”

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