The current wave of cloud adoption is a part of a larger digital transformation that businesses of all sizes are excited to participate in. Companies that migrate to cloud ERP are seeing gains around scalability and cost-efficiency, which historically were available only to larger companies willing to invest hundreds of thousands of dollars into on-premise software systems. However, moving to cloud ERP is a significant undertaking that, to some, is still daunting. In this write-up, we alleviate some of the uncertainty around a cloud ERP deployment by discussing the importance of a migration strategy, taking into consideration technical specifications, security, and data protection on cloud ERP systems.
A sound migration strategy
Broadly, your cloud migration strategy should be built around two key factors – where to move, and when.
When considering where to move, your decision-making team should consider the preferred hosting model—true cloud, or hybrid—and the location where your data will be housed. When considering timing, keep in mind that outside of your internal decision making processes, different vendors quote drastically different timelines for implementation, software customization, and data migration—so make sure to consider pre-purchase and post-purchase timelines when you map out your strategy to ensure a seamless transition.
Industry experts and thought leaders suggest the following additional considerations to ensure a successful transition. These factors provide additional insight into strategies and tools that businesses can employ to overcome cloud migration challenges.
Phase your migration – you don’t need to do it all at once!
Less risk, easier employee adoption
Mitigate some of the risk around your cloud ERP migration by doing it in phases. Businesses may want to start with historical financial data, customer data, or old sales orders to test initial compatibility or performance issues. With a strategic, step-by-step implementation, maintenance may be easier and your employees will be exposed to the new ERP system in smaller, more manageable pieces. Typically, cloud migration should begin with moving all system components to cloud followed by moving different business user groups, depending on the business model. Ultimately, the phases will be unique to your business—experts contend that no two migrations are the same, and the order in which you transition your applications also depends on parameters such as network latency and inherent data dependencies.
Decide what to keep and what to change
Businesses may feel pressured to move all applications to the cloud immediately upon purchase. But, unless your previous ERP license is expiring, this may not be required. In fact, keeping your sensitive business data on private cloud or internal servers may be good for ensuring the stability of the business during the migration. Adopting a hybrid cloud model is key to overcome this challenge. A conscious effort should be made by your company to understand whether upgrading or replacing all of your legacy systems, functionalities, and customizations make sense.
A common misconception amongst vendors considering a move to cloud ERP is that a move requires rewriting and redesigning all of their custom coded applications. The concern here is that a migration will result in duplicative efforts and tax a company’s developer resources. However, with most cloud deployments, no rewriting of code is required. Most applications can simply be re-hosted on cloud platforms with minimal configurations and alterations in system architecture. Re-hosting prevents investing in more hardware that will be left unused at the end of the migration.
Another common misconception is that on the cloud, your data isn’t as safe as it could be if it were stored on the cloud. However, data stored on the cloud, if protected by industry-standard SSL encryption, is equally as secure as most on-premise ERP solutions. All leading providers of ERP cloud solutions—ranging from Oracle and SAP to Amazon and Rackspace—follow highest industry standards of security. Organizations should look for cloud providers with robust and well-configured load balancers,secure firewalls, and automatic patch management features for maximum security.
Regional governments impose stringent data protection requirements for ERP vendors to adhere to; in addition, standard audit schemes such as ISO-9001 place additional regulations on firms. In some regions, business data cannot be transferred outside a particular region or country without keeping necessary safeguards in place—giving your information an extra layer of security. Practically, that implies that it’s often quite easier for servers to be physically located in those regions.
Organizations looking for a seamless migration to the cloud must consider the above before crafting a successful ERP cloud strategy. However, the process doesn’t end with the above— the evolution of your ERP strategy is a continuous, iterative process. Organizations must test the ERP system rigorously before and after the cloud migration to ensure that all the above issues are duly considered across the different stages of migration.