Understanding ERP migration

ERP is like a business’s central nervous system. ERP solutions provide organisations with visibility into what is happening across core business areas, including finance, supply chain, customer service, and HR, to name but a few. This helps companies manage multiple interlinked processes within a single integrated system.

An ERP migration is necessary when a legacy ERP becomes obsolete, no longer keeps up with customer needs, or limits a business’s ability to meet competitive demands. Whatever the case, data migration is a critical—and potentially painstaking—part of getting a new ERP up and running.

In this article, we shall explore:

• How to prepare for ERP migration

• Why cloud ERP is on the rise

• ERP migration challenges and pitfalls

• Best practices for a smooth data migration

Preparing for ERP migration

Data migration can be painstaking work. Transferring information related to customers, products, and suppliers from multiple formats into a single system carries inherent risks to the integrity of ERP data. Accuracy is essential to avoid delays, confusion, and data loss further down the line.

Businesses with a clear understanding of their goals, strategy, and needs put themselves in the best position for an accurate, timely data transfer. Here are a few ways to get prepared:

Build the business case

A sound business case begins with an honest problem statement. Organisations should evaluate the IT infrastructure, applications, and data they are currently working with and note any shortcomings. Outline how those limitations affect operations, employee performance, and customer relationships.

Then, explain how a new ERP will address those issues. Be clear about expected ROI, costs, resource constraints, and potential risks. The benefits of ERP depend on a new system starting with the best data. Organisations should be clear-sighted about the time, energy, and investment required.

Develop a robust data migration strategy

Successful ERP migration is founded on well-defined goals. Prepare preliminary project details with budget, realistic timeline, and scope. Select key performance measures to check against as the project progresses.

Start planning early to arrange resources and enable ERP implementation teams to delegate other work so that they can focus their energy on data migration when required. Securing early buy-in at all levels of an organisation ensures everyone is aligned and helps guard against disruptions or disagreements later on.

Choose an ERP implementation partner

Once a business defines its objectives and requirements, it can carefully evaluate its ERP options. Research suppliers for industry experience, compatibility with current technology, and a proven track record of meeting defined objectives.

Review supplier case studies to see how well they align with specific business needs. A suitable candidate will be familiar with the latest data compliance standards and industry regulations.

Why businesses are migrating to cloud ERP

Traditional on-premises ERP systems reside on servers owned and maintained by a business’s IT team. They require physical space, regular maintenance, and data transfer when legacy hardware inevitably reaches the end of its life. It’s why more organisations today are migrating to cloud ERP solutions. These subscription-based services offer the visibility and control that leading businesses require without a large capital investment or ongoing maintenance.

The advantages of a cloud ERP over an on-premises ERP include:

• Cost: Cloud ERP software is delivered over the internet, so there is no need for hardware that requires daily attention from already busy IT departments. Repairs, upgrades, and maintenance are covered by an ERP provider for a fixed fee.

• Scalability: Businesses can add data storage as they grow and new functions remotely as required. Pre-built ERP integrations connect to business apps with generative AI that help automate processes and support customers.

• Flexibility: Cloud ERP solutions quickly adapt to new business models and changing regulations. Organisations can find opportunities to innovate by connecting previously siloed data and consolidating, standardising, and integrating applications.

• Analytics: Modern cloud systems enable leaders to make better and faster decisions. AI tools enhance insights concealed within large, complex data sets to help identify trends and anticipate change.

• Security: Cloud ERP solutions help reduce risk and increase compliance transparency. ERP vendors’ security teams can make critical updates, troubleshoot, and respond to cyberattacks remotely without the need for an expensive site visit.

Common challenges with ERP data migration

ERP migration is more than just moving files. A business’s continuity of workflows and ability to find information quickly depend on an accurate transfer of all relevant ERP data.

There are plenty of variables to deal with. But these complexities can be overcome, especially if businesses are aware of the issues that most often catch teams out:

• Data quality: Redundant, old, unnecessary, or outdated content has downstream effects, causing problems and limiting insights

• Resource constraints: It takes time, expertise, and focus to uncover ERP data trapped in information silos, then extract, cleanse, and prepare it for migration

• Legacy ERP complications: The more customised a legacy system is, the longer and more complex an ERP migration tends to be

• Compliance and security: Migrating data from multiple sources securely requires knowledge of evolving cyber threats and awareness of regulatory guidelines

• Change management: A legacy system may feel like second nature to many employees—balancing their workload with learning a new system may cause stress

Best practices for ERP data migration

Accurate ERP data underpins employee processes, supply chain systems, customer service interactions, and so much more. Businesses need to transfer data with both low-level detail and high-level strategy in mind.

To help ensure that any data being transferred is optimised for a new ERP system, please follow these tips:

Assess existing data

Different departments within one organisation can handle the same piece of data differently. This can lead to inconsistencies, duplications, or inaccuracies that appear later at precisely the wrong moment.

Since a new ERP will be a business’s single source of truth, it is wise to be selective about exactly what is being migrated. Copying over every last bit of data may cause confusion or errors later on. A thorough assessment of data by department will ensure that useless information does not clog up a new database.

Carefully map data fields

A blueprint for where data will flow helps organisations spot inconsistencies and enable automated transfer. To achieve this, businesses should map data from source platforms and solutions to the structure of their new ERP system.

Give ERP implementation teams time to understand what they are seeing, flag issues as needed, and convert data into formats that better suit the new system.

Determine data governance

It is vital for an organisation to decide who owns which data before it is moved. Intentionally assign roles for whenever specific types of data should be incorporated, how it will happen, and who is responsible for it.

Appoint one person to oversee compliance. This will help ensure that the entire ERP migration effort is continually aligned with the latest regulations.

Establish a rigorous validation process

To ensure test results can be accurately interpreted and acted upon, it is a good idea to verify testing methodology early.

Test as soon as the first data are transferred and regularly re-validate results as more data are moved. This approach offers businesses opportunities to learn, apply insights widely, and avoid problems when the pace increases.

Encourage a collaborative rollout

IT specialists, end-users, and stakeholders all need to be on board for an ERP migration to succeed. To build buy-in, it is best to develop a strategy together, clearly communicate priorities early, and be upfront about how the change will affect everyone.

Regularly inform executives, departments, customers, and employees of the project’s status and how the finished product will improve their experience.

ERP migration checklist: 7 key strategies

As with any company-wide project, even with the best planning, unexpected issues will arise. Adhere to these strategies to tackle hiccups directly and manage risk:

1. Carry out a thorough assessment that defines clear objectives

Clearly understand data requirements by intentionally gathering input across the organisation, from management to end users. Find out what is causing frustration, slowing down processes, or hindering innovation. Then, create a list of measurable goals to address those specific pain points.

2. Engage with experienced consultants

Once an organisation has clear goals documented, a consultant can help prioritise them and explore other issues a business might need to consider. An informed, external perspective can also clarify what success looks like, both at the end of an ERP migration and for years to come.

3. Engage stakeholders early and frequently

ERP migration is an organisation-wide effort that will thrive on clear communication, so set expectations from the outset. Inform every affected department, partner, and customer about how and when the change will impact them, so that everyone can prepare and no one is caught unawares.

4. Document a comprehensive ERP migration project plan

Develop a detailed task list for every step, from start to finish, with key milestones and dates included. Be clear about what is required to complete each step and keep track of how much time they take as you proceed.

5. Adopt a clean core strategy for master data cleansing and preparation

Businesses that avoid modifications to the core functions of their ERP system tend to sidestep future complexity and performance issues. Enable a clean core to minimise risk, quickly benefit from updates, and easily integrate with new technology.

6. Simplify your cloud migration with a phased approach

An ERP migration should be carried out gradually. Work through key systems or processes by department, employee, or location. Address issues proactively, learn, and move forward. It takes a little longer, but being methodical is essential for complex or high-risk projects.

7. Test thoroughly and provide training

Confirm that a new ERP is accurately importing new data by testing small amounts first. Manually check each application, rectify issues, and confirm that the new and old ERP systems are aligned. Then, add more data and use cases while giving end users the opportunity to train and obtain certifications.

Who should be part of my ERP migration team?

A data migration strategy is only as good as the people who work together to implement it. The success of any new ERP system depends on the team shaping the project from the outset and seeing it through to completion.

Here are a few suggested roles to assign and their focus:

• Executive sponsor to act as the main contact with leadership, secure executive buy-in early, and help resolve issues as they arise

• Project manager for directing traffic with an eye on schedule and budget

• IT manager or systems administrator to ensure any current data-driven systems are compatible and ready for migration

• Business analyst to help clarify the business case for ERP migration and shed light on its short- and long-term impacts

• Cross-functional leaders to ensure all relevant data is included from key areas of the business, including finance, sales, operations, and HR

• Change management lead to help employees prepare for—and embrace—the capabilities of a new ERP system

• Data migration specialist to assist with mapping, collecting, cleansing, and preparing data for seamless transfer

• Quality assurance/test lead to inspect processes at each stage and ensure the integrity of data being transferred aligns with the new ERP system’s requirements

• ERP supplier/consultant to guide an organisation through the process with a fresh perspective and long-term goals in mind

FAQs