4 Best Practices for Successful ERP Data Migration

  • June 25, 2019 - by Nanditha Kini
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Data. Chances you’re drowning in the sea of data are extremely high. Company information, employee details, customer invoices, supplier and vendor documents, customer care data… The list is endless. Considering the humongous volume of data, timely and efficient processing is one of the highest priorities in business. Inaccurate data has a direct impact on the bottom line and therefore data integrity is critical to the projection of the true status of a company’s health. Inaccurate and inconsistent data, if fed into an ERP system, can become an ineffective indicator of how your business is performing. If you don’t efficiently deal with data before implementing your ERP system, it could not only result in a failed implementation, but can also take your entire organization down. Let’s look at why data migration is crucial in ERP implementation, the challenges associated with the process, the risks of a poor data migration strategy, and some best practices for ERP data migration to ensure efficiency, adherence to budget, and a smooth go-live.

Why Data Migration is Crucial in ERP Implementation

Data migration is often the foundation or basis to gauge the success or failure of an ERP implementation. Since ERP manages and works primarily with data, efficient data migration is fundamental to an ERP implementation project. Unless the beginning balance of accounts is correct, you cannot expect the system to churn out accurate information.

The main goal of data migration is to ensure that the data being migrated is cleaned of redundancy, duplicity, and relevance. It should be credible and arranged in a manner that can be further analyzed to represent as accurate a picture as possible of the true picture of a business’s health. Key factors that need to be considered for any data migration are:

Challenges in Data Migration

Although important, migration is more than just copying data from source to destination; you have to validate the data being provided, and make sure it is clean. If you have been creating your own ways of inputting information into legacy systems, or if processes haven’t been standardized across functional groups, your data is going to be dirty. Here are some key challenges with respect to data migration:

  1. Ensuring credibility of data
  • Spending insufficient time studying and understanding data
  • Not giving enough time and attention to data quality and data discovery
  • Running the risk of inaccurate conclusions basing analysis of just a small sample of data
  • Process complexity leading to large volumes of inaccurate, complex data
  • Insufficient data cleansing, making it irrelevant to the context of its requirement
  1. Lack of knowledge of working with data
  • Limited knowledge of how the source systems work
  • Little knowledge of how the target system works
  1. System and role-related challenges
  • Insufficient access to the target system
  • Inaccurate or insufficient input from the business teams

Risks of Poor Data Migration Strategy

If you are on the road to implementing an ERP in your organization, there’s a lot you need to think about. The primary goal is to ensure a successful implementation. But for that to be possible, you need to be aware of the importance (and complexity) of data migration. ERP data migration, that involves the transfer of data from one storage type, format, or system to the new ERP solution, is an excruciatingly time-consuming process. A well-defined data migration approach ensures you are able to adhere to the implementation timeline, avoid costly budget overruns, and go-live with clean, meaningful data that helps you reach your business goals more effectively. However, the risks of a poor data migration strategy are many:

  • Working with inaccurate, incomplete, and even false data
  • Substandard performance of the new system which will not deliver expected results or aid in recouping costs in the time specified
  • Unnecessary time and cost spent on remedial actions to cleanse data, and directing additional resources to carry out this work to stay on track towards pre-determined project timelines
  • Potential cost of missing out on deadlines if data cleansing and migration overshoots the allotted time
  • Time wasted on devising new strategies for workarounds to be implemented and deploying additional people to carry out this activity
  • Unsatisfactory user experiences and a decline in confidence in the management
  • Degeneration of relationship with your ERP vendor and partner
  • Lack of communication across different stakeholders which will further aggravate the faulty data migration strategy
  • Inability to use the ERP system to its full capacity or potential, and reap the benefits for which it was intended

ERP Data Migration Best Practices

Data migration constitutes a substantial portion of the entire ERP implementation process. It is greatly affected by the number of systems your organization is using, the number of sites that are going live, the presence of legacy systems, the number of end-users involved with the data, the regulations affecting your industry, among others. The sooner you start dealing with your data, the better your chances of avoiding disruptions and delays with your ERP implementation. Here are 4 ERP data migration best practices you should keep in mind while embarking on the data migration journey:

  1. Plan for the data

The first step towards successful ERP data migration is building a strategy based on the business model and goal of the entire process. These are the building blocks of a comprehensive data migration strategy and involves: segregating content into categories depending on its utility and criticality to future operations, eliminating low-value content to speed up the process for company teams as well as for external customers and partners, and extracting necessary information and segregating it. This will help business analysts involved in the process to better analyze the information and derive meaningful reports, analysis, and content out of the data. This can be used to uncover relevant insights, streamline operations, and reduce risk—ultimately leading to faster, better decision-making, and enhanced outcome. It is also equally important to evaluate the complexity of the data, categorize it into master data, open transactions, and historical data, and assess the available resources for migration. This helps in knowing what to discard, what to archive, and what to carry forward.

  1. Develop a migration strategy

Although your ERP implementation partner will play a big role in the data migration process, it requires equal participation from your organization. With the help of your partner, outline a plan and articulate it throughout your organization, assigning roles, delegating responsibilities, and empowering decision-makers. Leverage the acumen of your stakeholders to prioritize business tasks and make well-informed decisions about the strategy to adopt. Depending on the caliber of resources available and the volume plus complexity of data to be migrated, set up a logical, implementable sequence of actions, along with deadlines for each of those actions – all whilst adhering to the known best practices. Work systematically, and as far as possible, and resist the urge to go for a Big Bang approach.

  1. Stick to data standards

Irrespective of the number of data sources or systems you are migrating your data from, the data in each source or system will be stored in a format different from the other. In addition, each department most likely will have used its own specialized pattern of data classification. Make sure to stick to data standards; create a migration design that supports uniformity, and some manner of standardization for all data. This defining of standards will take collaboration among department managers and executive management towards the next level. Carry out data mapping of source to destination data to ensure that the right data resides in the right location in the destination system. Discard or abandon data that is not needed. And make sure to cleanse complex data coming from multiple sources.

  1. Carry out sufficient testing

There are several types of tests that are common to the data migration process: unit, system, volume, batch application, among others. It is generally a good practice to ensure that all these tests are carried out as soon as possible, for each work unit, before the conversion can be confirmed. This helps in avoiding accumulation of redundant data issues until later stages in the development cycle, when they are more expensive to amend. Another issue to counter is the transiency of data. Sine data is never consistent and always changing in the source system, sufficient auditing and testing should be done before all project milestones, to facilitate revision of decisions, as deemed necessary.

Data migration for ERP success

When it comes to ERP implementation, data migration is one of the most important, and time-consuming aspects of the implementation process. Yet, too many organizations end up making too many mistakes when it comes to ERP data migration. Regular communication and co-ordination between separate teams is extremely important for successful data migration. Once you are sure of being on the same page with your ERP partner, it’s time to move ahead with the data migration process: plan for the data, develop a robust migration strategy, stick to data standards and carry out sufficient testing to see the results you worked towards.

About the Author – Nanditha Kini

Nanditha Kini is a Sr. Manager Pre-sales – Dynamics AX, at Synoptek with close to 10 years of IT advisory experience, which includes ERP product sales and implementation experience: pre-sales, client engagement management, implementation strategizing, project planning and management, change management, business process transformation, and system training and support.

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Contributing Author: Malavika Nityanandam