More businesses are operating on the cloud than two years ago, with more transformational motivation on both the employee and client side, according to a new report from KPMG, “Elevating Business in the Cloud.”

The report, which surveyed more than 500 global executives from the financial services, retail, health care, media and pharmaceutical industries, represented a shift from the survey’s 2012 edition.

The top use for the cloud in 2014 remained to drive cost efficiencies (49 percent), as it has been in 2012 (48 percent), though more respondents said they were using cloud technology for large-scale change.

Those changes include better enabling a flexible and mobile workforce, according to 42 percent of respondents, which tripled the 15 percent of executives who said the same in 2012. This year, improving alignment and interaction with customers was another big reason for utilizing the cloud, according to 37 percent of respondents.

As the top two benefits of using cloud to improve workforce mobility, 2014 executives cited increased employee productivity (54 percent) and higher employee satisfaction and flexibility (48 percent).

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“People’s expectations as employees are a lot different than they were ten years ago,” stated Mark Shank, managing director of the digital and mobile practice at KPMG. “Employees today demand the same access, experience and richness on their work computers and mobile devices as they have on their personal devices. Cloud is making that possible, and organizations are turning to it to enable a more flexible and mobile workforce.”

On the client interaction side, retail executives were over seven percent more likely than other industry executives to say their organizations are using cloud to improve alignment and interaction with customers, suppliers and business partners.

“Today’s empowered consumers expect more from their retail experience, and this adds pressure and uncertainty to retail businesses and operating models,” stated Jeanne Johnson, a principal on KPMG’s management consulting team who focuses on consumer markets. “Consumers expect to be known, recognized, and offered personalized insight and offerings. They want to interact with the brand in person, on-line, on the go – on their terms. They also prefer ready access to knowledgeable and responsive associates across those various channels.”

Data security remained a concern to 2014 survey respondents, but less so than two years ago. This year, 50 percent said the risk of intellectual property theft is the most significant challenge of doing business in the cloud, followed by data loss and privacy risk (45 percent). In 2012, 78 percent cited intellectual property theft and 83 percent named data loss and privacy risk as challenges. Overall, however, security and data privacy was reported as a greater challenge than two years ago, overtaking 2012’s most significant challenge of cost efficiency.

“While the challenge posed by cloud related data loss and privacy threats are less pronounced in the minds of global industry leaders, they are still taking the issue seriously,” stated Rick Wright, principal and global cloud enablement leader at KPMG. “The clear trend in the data that we have collected shows that, even in the face of significant media attention paid to recent data breaches, global leaders are still willing to embrace the transformative potential of the cloud.”

KPMG’s full “Elevating Business in the Cloud” report is available here.

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