Understanding ERP migration

ERP is like a business’s central nervous system. ERP solutions provide organisations with visibility into what’s happening across core business areas, including finance, supply chain, customer service, and HR, to name a few. This helps companies manage multiple intertwined 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 meticulous work. Transferring information related to customers, products, and suppliers from multiple formats into one system brings inherent risk 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 starts with an honest problem statement. Organisations should evaluate the IT infrastructure, apps, and data they’re currently working with and note any shortcomings. Outline how those limitations affect operations, employee performance, and customer relationships.

Then, articulate 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-eyed about the time, energy, and investment required.

Develop a solid data migration strategy

Successful ERP migration is rooted in well-defined goals. Draft rough project details with budget, realistic timeline, and scope. Select key performance measurements to check against as the project progresses.

Start planning early to line up resources and empower ERP implementation teams to delegate other work so they can focus their energy on data migration when needed. Early buy-in across all levels of an organisation gets everyone on the same page and helps defend against disruptions or disagreements later.

Choose an ERP implementation partner

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

Check vendor case studies to see how well they align with specific business requirements. A good fit will be familiar with the latest data compliance standards and industry regulations.

Why businesses are migrating to cloud ERP

Traditional on-premise 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 runs its course. It’s why more organisations today are migrating to cloud ERP solutions. These subscription-based services offer the visibility and control leading businesses want without a large capital investment or ongoing maintenance.

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

• Cost: Cloud ERP software is delivered over the internet, so there’s 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 flat fee.

• Scalability: Businesses can add data storage as they grow and new functions remotely as needed. 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 once-siloed data and consolidating, standardising, and integrating applications.

• Analytics: Modern cloud systems allow leaders to make better and quicker decisions. AI tools elevate insights hidden within large, complex data sets to help spot 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 a costly 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 depends 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 trip up teams:

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

• Resource constraints: It takes time, expertise, and focus to uncover ERP data trapped in information silos, then extract, clean, 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 any data being moved is optimised for a new ERP system, follow these tips:

Evaluate 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 just the wrong time.

Since a new ERP will be a business’s single source of truth, it’s wise to be selective with exactly what’s migrating. Copying over every last bit of data may cause confusion or errors later. A thorough assessment of data by department will ensure useless information doesn’t 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 get there, 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’re seeing, flag issues as needed, and convert data into formats that better fit the new system.

Determine data governance

It’s critical for an organisation to decide who owns what data before it’s 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 the entire ERP migration effort is continually in line with the latest regulations.

Establish a rigorous validation process

To ensure test results can be accurately interpreted and acted upon, it’s 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 allows businesses opportunities to learn, apply insights broadly, and avoid problems when the pace picks up.

Encourage a collaborative rollout

IT experts, end-users, and stakeholders all need to be on board for an ERP migration to succeed. To build buy-in, it’s best to develop a strategy together, clearly communicate priorities early, and be upfront with 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

Like 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. Conduct a thorough assessment that defines clear objectives

Clearly understand data requirements by intentionally gathering input across the organisation, from management to end users. Learn what’s causing frustration, slowing processes, or stifling 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, outsider 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 a business-wide effort that will thrive on clear communication, so set expectations upfront. Let every affected department, partner, and customer know how and when the change will affect them so that people can prepare and nobody is surprised.

4. Document a comprehensive ERP migration project plan

Develop a detailed task list for every step, beginning to end, with key milestones and dates attached. Be clear about what it takes to complete each step and track how much time they require 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 problems. 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 performed gradually. Work through key systems or processes by department, employee, or location. Address issues proactively, learn, and move on. It takes a bit longer, but being methodical is a must for complex or high-risk projects.

7. Test rigorously and offer training

Confirm a new ERP is accurately pulling in new data by testing small amounts first. Manually check each application, correct issues, and confirm new and old ERP systems are aligned. Then, add more data and use cases whilst giving end-users the chance to train and achieve 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. Any new ERP system’s success depends on the team shaping the project from the beginning and seeing it through until the end.

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

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

• Project manager for directing traffic with eyes on schedule and budget

• IT manager or system 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 illuminate its short- and long-term impacts

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

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

• Data migration specialist to help map, collect, cleanse, and prepare 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 vendor/consultant to guide an organisation through the process with a fresh perspective and long-term goals in mind

FAQs