Migrating to the cloud

As companies grow, they can lose control of their data, not understanding how much information they have and where it resides. In response, many middle market companies are moving data to the cloud for increased efficiency and access, but also greater security. Cloud vendors’ economy of scale enables them to implement more extensive security measures and controls that are not typically realistic for middle market companies.

“Before moving to a cloud solution, ensure that you understand the data the cloud provider is storing or accessing,” said Stasiak. “This will determine the level of security needed by the provider.”

The RSM US Middle Market Business Index data demonstrates the gradual migration of middle market data to the cloud. The survey shows that 38 percent of respondents moved data to the cloud as a result of security concerns in the last 12 months.

Executives are more comfortable with the decision to move to the cloud, due to a general feeling that the cloud security has improved. Among middle market executives reporting moving data to the cloud for security concerns, 94 percent believe the data residing in the cloud is more secure than in the past.

Organizations commonly see cost savings when transitioning data to the cloud, as costs are going down due to saturation in the market. For example, the survey found that 30 percent of middle market executives that moved data to the cloud for security concerns indicated the solution is less expensive, a significant increase from last year’s data (19 percent).

However, given the saturation in the cloud market, businesses must be careful when choosing potential providers. Companies should undergo a thorough due diligence process on vendors to ensure that solutions are truly secure and the necessary level of access is available. When utilizing a third party, the company that owns the data still retains the responsibility if an incident occurs, and a breach in the cloud can be harder and more expensive to remediate.

Cloud providers should also be a key consideration when selecting cyber insurance. “Ensure that your cyber insurance policy covers breaches at a cloud provider,” commented Stasiak.

In addition to the cloud, blockchain solutions are becoming a viable alternative to enhance data security. RSM research found that 22 percent of organizations are pursuing blockchain technology to ensure security or privacy of data. More larger middle market organizations are evaluating blockchain than smaller peers (38 percent versus 10 percent).

Middle market companies now have more options than ever to store data more securely than within on-premise servers. However, a crowded marketplace can also present new challenges. Organizations must be careful when evaluating potential providers to ensure that solutions align with their risk tolerance and business goals.