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5 Key Considerations When Moving from On-Premises to Cloud ERP

5 Key Considerations When Moving from On-Premises to Cloud ERP

moving erp to the cloud

Cloud ERP adoption has been on the rise, with more and more organizations realizing that it is the most cost-effective, flexible, and fast way to deploy their business applications without the need for substantial capital investments and additional IT resources. However, moving from on-premises to Cloud ERP is a big decision, and there are several factors to consider when deciding if it is right for your organization.

1. ASSESS TOTAL COST OF OWNERSHIP (TCO)

Organizations often make decisions based on incomplete or inaccurate information when assessing on-premises ERP costs. It is essential to consider your entire TCO, including implementation costs, hardware upkeep, software licenses, staff time, and any hidden add-on costs. In many cases, organizations don’t consider the cost increases that might come with additional users, storage, transactions, and other aspects as well, which can make cloud solutions very expensive. Each organization must assess and quantify the TCO for each option and make an informed decision about moving to Cloud ERP.

2. EVALUATE CLOUD OPTIONS

You must evaluate and choose from all your available options – including SaaS, vendor-provided hosting options for on-premises solutions and hybrid third-party hosted cloud options – based on your unique needs and business processes.

  • In public clouds, you share the same hardware, storage, and network devices with other organizations or cloud tenants. Public clouds offer high scalability, high reliability, and no maintenance at lower costs.
  • Private clouds are used exclusively by one business or organization. They provide more flexibility, improved security, and high scalability.
  • Hybrid clouds combine on-premises infrastructure, or private clouds, with public clouds and offer the best of both worlds. They provide greater control over your infrastructure, better flexibility, and ease of deployment.

3. DEVELOP A MIGRATION PLAN

Do you want to move all your applications or start with non-core business components? A hybrid approach to cloud is often ideal for organizations that use highly configurable systems that have been customized to meet their specific needs. When considering your applications for the cloud, ask the following questions:

  • Which applications will deliver the most value by moving to the cloud?
  • How will the move affect the application’s functionality and customizations?
  • What impact will the move have on your business process?
  • If an application costs little to manage in-house, will moving deliver any benefits?
  • How hard would it be to move this application to a new platform?

Understand which business processes will be automated and assess whether the move delivers the desired business benefits. It is crucial to consider the long-term impact on your business..

4. PLAN YOUR DATA MIGRATION

Migrating data is one of the most challenging parts of cloud migration. Having a detailed strategy and roadmap can significantly simplify data migration. Identify the types of data that may be required to be stored or processed in the cloud. Examine the data thoroughly for any inaccuracies, standardize data formats, and eliminate redundancies by cleansing your data.

Do some research and find out whether the data migration procedure has worked well for other organizations like yours. Set clear guidelines for who has the right to create, approve, edit, or remove data from the source system, and document that in writing as part of your project plan. Often, cross-object dependencies have not been discovered until very late in the migration process, so be sure to have an alternate plan in place.

5. DEVELOP A CHANGE MANAGEMENT APPROACH

Cloud ERP implementations can succeed or fail based on organizational change management. The new Cloud ERP system is integral to achieving your business goals, so you must ensure that users are qualified and motivated to use the Cloud ERP system.

Change management helps users through the transition period after the new system goes live. Communicate essential information and engage employees about cloud migration. It is possible that some existing processes and employee roles will change when implementing the new cloud ERP system. You must plan for employees to receive the necessary training so they can deal with these changes and make the best use of the new system. The benefits of Cloud ERP can only be realized when your employees embrace the process changes created by implementing the new system.