Can you transform digitally without considering Cloud?
Of course not! Cloud technologies are a vital part of Digital Transformation. Moving to the Cloud is a big step when it comes to your IT infrastructure. In my earlier posts, I covered security issues and the benefits of moving to the Cloud, among other things.
But what does it mean for you to move some of your systems to the Cloud? Can you do it with the snap of a finger? No. Moving any system to the Cloud will need a considerable amount of preparation. This preparation will lead to “Cloud readiness,” meaning you can move your systems to the Cloud without much impact on your business.
In this article, I address many steps you should consider in order to make this transition. These will fluctuate depending on the specific situation within your company.
Let’s shed some light on the subject of “Cloud readiness.” There is a big difference in using systems on premises versus in the Cloud. This applies to business processes, data interfaces to other systems, maintenance of the systems, and many more applications.
Let’s assume you have an ERP system that you want to move to the Cloud in order to save costs, be more agile, focus on your core business, and become more competitive. I assume, that you are aiming for a managed service, i.e. SaaS. This will bring some relief to your IT infrastructure.
Here is a list of steps that are very important to consider when preparing your Cloud readiness:
- Find a highly competent partner to guide you through this process. Moving to the Cloud is probably something no one on your team has ever done before. You need to hire an experienced partner, ideally one who has gone through this process several times already. Make sure to get references and reach out to them for information. If you’ve already found an experienced partner—congratulations. You can stop reading.
- Build a team within your company. This is commonplace, but the list would be incomplete without mentioning it. The team, of course, has to consist of highly motivated and highly capable people in order to perform this demanding task.
- Prepare a list of the customizations you have in place. Most ERP systems will only give you very limited means of customization in the Cloud. This lies in the nature of Cloud systems. You need to know exactly what customizations you have in place.
- Analyze your customizations and understand the reason for their existence. Depending on the way you have implemented your customizations, it is most likely that you have to either get rid of or transform them to different technical standards. I have often encountered situations where customizations were just legacy from long ago. Another reason could be that they were prepared to support some awkward business process. Whatever reason you had to do this in the past, you need to evaluate how it can be done in the Cloud.
- Be prepared to change your business processes. I’d like to point out here that Digital Transformation will likely lead to different business processes. Besides preparing Cloud readiness for different systems, you have to look at the total of your business processes as well. I think it’s a great idea to assign this project to a member of your team. It should also include all other initiatives you’ll experience within the course of your Digital Transformation.
- Analyze the interfaces to other systems. You may have a CAD system that looks up your bills of material and item data, or you may have an ECM system that is connected to your ERP system. Whatever it is, you need to understand that the way systems interact with each other has to be changed. This will cause you to rethink your entire on premises configuration. All of these things are pretty much interconnected. Did I mention that this would be a challenging task?
- Consider the technical details. For instance:
- Is your network infrastructure ready to take the additional load?
- Does your staff require supplemental training? Cloud processes will likely differ from what you have on premises right now. The user interface might change as well.
- How do you transfer your data to the Cloud?
- By the way, are your subsidiaries involved in this?
- Revise your data, especially master data. I have experienced quite a few issues with this. If left alone, users tend to misuse data fields, e.g., adding information into a field that doesn’t belong there. If you move to the Cloud, this probably won’t work anymore. Make sure the data quality has been thoroughly scrutinized before even thinking of switching to the Cloud. As you may have guessed: this is big undertaking! It will require a lot of time and resources. But even if you don’t switch to the Cloud, this is something that will still highly benefit your company.
- This is a very demanding project. Here is a list of the most important steps. But remember, these are only the main points, so you will need to analyze your company’s individual requirements.
- Name a project manager. Clearly, this person should have some experience in managing demanding projects.
- Create a steering committee that includes high brass members of your company and any partners. Make sure they meet regularly, and that all critical issues are brought up in these meetings.
- Build a team within your company. This is commonplace, but the list would be incomplete without mentioning it. The team, of course, has to consist of highly motivated and capable people to perform this demanding task.
- Set up a project plan that includes all necessary steps, milestones etc. During the course of the project, this will be refined and changed as required. Having deadlines is absolutely crucial to reach your plan goals within time and budget.
- Consider all other aspects of running a project and add those to your list.
- Finally, make sure you do a proper test before the final step. It is absolutely mandatory to do comprehensive testing in the last phase before flipping the Cloud switch. Additionally, this test phase will also demonstrate how the system works under a heavy load, as well as how your network behaves under heightened stress.
- It is all about your business goal: make money. This is all very technical, but you should never lose sight of the actual goal. In the end, Digital Transformation has to benefit your bottom line. Business processes have to be more efficient and easier to perform, your costs have to drop, and the agility of your business has to rise. In the end it’s all about your customer. Your competitors will most likely do this, so you want to be ahead of them. Whatever you do, ask the question: Does transitioning to the Cloud serve your goals?
Do you think this is complicated and hard to achieve? It certainly is. It is a task that will probably take you more than a year or even longer. That is why it is so important to start immediately. If you begin the process two years from now, you most likely end up outpaced by your competitors.
If you are reluctant to do this because it is too complicated, you better think twice! Digital Transformation is about the survival of your business. It is not optional. Let’s get started!
Can you agree with my thoughts? I would love to see your comments on this article or reach out to me directly, using the contact form.