Checklist before moving ERP to cloud

The cloud has ushered a transformational journey for enterprise applications. While the cloud offers the obvious benefits of ‘as-a-Service’ usage, it can offer much more for enterprise applications. Often termed as modernisation, every enterprise application can enhance return on investment and augment the value it provides by leveraging the cloud.

An ERP application is no different. It enables the business users and technology teams to leverage the ERP cloud providers for upgrades and for keeping the application ‘current’. The security of the ERP is taken care of by the cloud vendors such as Oracle.

Hence, the benefits of moving your ERP to the cloud are immense. However, the decision is not as seamless as it may theoretically appear. Here’s a list of questions that you might want to go through before considering a cloud ERP:

What is the compelling need to move on-premises ERP to the cloud?

An on-premise ERP like Oracle EBS might be working perfectly fine for your business. It might be giving you the desired strategic insights and reports. However, if it is burdening the technology team in your organisation with the constant customisations, integrations, report creation and building relevant analytics, and system upgrades, it could be a cause of concern. Moreover, if the bandwidth of the technology team is utilised in the above, it could lead to a delay in the adoption of new-age technologies and digital initiatives.

In today’s digital age, it could impact both revenues and brand building. Depending on the answer to the above, a cloud ERP could be a good choice as it could ensure that it is the last migration, it can also ensure seamless integration with other modules or enterprise applications on-premises or on the cloud through secure and out-of-the-box integration.

The decision to move to the cloud should be taken after gauging if the business is being impacted due to the on-premises ERP and if the bandwidth consumption of technology resources is such that it hinders innovation.

Should I just lift and shift to the cloud or is there another way?

A ‘lift and shift’ approach enables one to move the on-premises ERP to the cloud. In such a modernisation exercise, the modules are moved as it is and subsequently, the business users run the ERP on the cloud. Any further customisations, upgrades, integrations, etc. are managed after moving the ERP to the cloud.

The ‘lift and shift’ strategy can be considered during three scenarios. The first one is when the existing IT infrastructure is approaching a hardware refresh. The second scenario is when the existing ERP application and the surrounding custom code have evolved to a large extent and you want to retain it as it is on the cloud.

Lastly, ‘lift and shift’ is a good option if you want to take a measured approach to cloud adoption by stabilising the existing ERP on the cloud for a year or two before considering a complete SaaS ERP implementation.

‘Lift and shift’ is best adopted by consulting a service provider with significant expertise and experience in having implemented this strategy for other organisations. This will enable your organisation to avoid mistakes and enhance the probability of success of such a strategy.

If I migrate my ERP to the cloud, what will I do with the existing licenses?

Depending on the size of the organisation and the number of business users accessing the Oracle ERP, the licenses could take a heavy toll on the organisation in terms of cost. However, with the cloud, the subscription model comes to such an organisation’s relief.

Before making such a move, it is critical to understand if the cloud providers such as Oracle and Microsoft can optimise cost and provide value basis the already procured existing licenses with the BYOL option. This cost optimisation is crucial in empowering the organisation to take the plunge towards adopting a cloud ERP.

Should I migrate entirely to the cloud?

An important question that many organizations as is whether they need to migrate the entire on-premises ERP to the cloud or can they retain it on-premises and integrate the desired modules from the cloud. A cloud service provider must ensure that select and relevant modules can be procured on the cloud.

The vendor must also provide tools and the technology (PaaS) to seamlessly integrate with the on-premises ERP to ensure that the organisations can enjoy the best of both worlds.

This hybrid deployment model can also enable organisations to make the ERP more robust by integrating the ERP with powerful data analytics systems, new-age technologies such as the internet of things and blockchain.

This will ensure that the deluge of data is channeled towards the ERP and the ERP can deliver cutting-edge business insights that empower the strategic and tactical management teams to make well-informed decisions.

By Shrikant Navelkar, Director, Clover Infotech