The role of a readiness assessment in ERP upgrades
Organisations that rely on enterprise resource planning (ERP) systems are accelerating their move towards SAP S4/HANA software upgrades, and migrations as the support for the Business Suite slows down ahead of the 2027 deadline.
SAP reports that there are 16,400 S/4HANA subscribers globally, as of Q1, 2021, growing significantly from the 370 subscribers recorded in 2015 when the platform was released, a number that's anticipated to increase as the deadline nears.
Business leaders must consider upgrading legacy systems and keep pace with modern ERP systems to ensure business continuity. Outdated systems can hinder business success, and failing to update these systems can leave long-lasting impacts on a company.
Relying on cumbersome legacy systems can slow down workplace productivity as these systems often rely on outdated, manual processes to complete tasks. Additionally, older ERP systems are locked down for on-premises users, reducing the potential for workers to leverage these tools from the cloud and work remotely as needed. This reliance on centralised ERP systems can make a business far less fluid and agile.
While it's essential that companies invest in system upgrades and migrations, it's also critical that business leaders take the time to truly understand the impacts that upgrades will have on their systems and processes — including those that aren't directly affected by the process changes.
ERP systems can have far-reaching effects on the success of a business, including in terms of workforce productivity and efficiencies, so business leaders must have a comprehensive understanding of the business needs ahead of deploying new software solutions.
Conducting readiness assessments is one way organisations can effectively prepare for ERP software upgrades and migrations, especially regarding data modernisation.
An ERP readiness assessment also mitigates the potential risks of an ERP system upgrade or migration. An ERP system overhaul can be challenging; it may require updating entire systems and processes, cleaning and reorganising data, and retraining staff.
If they conduct a readiness assessment ahead of time, business leaders can gain a clearer picture of the implementation process — including what steps must be taken ahead of time, any additional costs that will be incurred, and even any potential security risks.
This lets business leaders better plan for the ERP system upgrade or migration, minimising additional costs and challenges later down the track. It also enables them to accommodate any unpredictable challenges that may arise.
Additionally, an ERP readiness assessment can show business leaders the underlying systems and data that need to be modernised ahead of an ERP system upgrade. Good data governance is critical to today's organisations, and it's even more crucial that data is ready for migration into a new system.
Similarly, business leaders must understand the potential impacts of a new ERP system on other underlying systems and processes. A readiness assessment can help teams understand gaps between the systems in place, what additional upgrades need to be made, and how to mitigate any challenges that may arise when integrating new systems. This is especially important when systems have interrelated processes that may be affected by a change in the ERP platform.
Readying a business for ERP upgrades with readiness assessments
As with any significant software change, upgrading or migrating to a new ERP system can be a challenging experience. ERP upgrades may require entire business processes to be reviewed, data to be assessed, and existing interfaces updated.
In addition, workforces and teams may need retraining to ensure they understand best practices on how to use the new system. This can be even more complex in the event of a multisite upgrade.
However, investing time and resources into an ERP assessment empowers executives to carefully prepare the business for a migration.
