7 Questions That You Must Ask Before Implementing A Cloud ERP Solution

  • 12 July 2021
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7 Questions That You Must Ask Before Implementing A Cloud ERP Solution

The first step towards digital transformation is to implement a cloud ERP solution to manage the business processes. Most businesses already use some or the other form of ERP. However, those ERPs have become a legacy. As the industry experts rightly opine- today’s legacy ERP is present only in the boiler room of the office. These ERP systems cannot be used at home or in the field where the customers and stakeholders are present. This is where cloud ERP comes into play.

However, implementing a cloud ERP comes with a set of challenges. You will notice some of these challenges only after the implementation gets completed. So, the hope of streamlining the business with a new cloud ERP solution might come crashing down if some aspects are not taken care of. 

What are these aspects? Let’s discuss.

Recently, we hosted a webinar where we discussed what questions a business owner or decision maker should ask the vendor before implementing a cloud ERP solution. These questions are too important to be ignored. They are directly connected to the success and profit of the company. So to help us get the necessary insight, we had three industry insiders-

  • Mr. Pramod Gokhale, Group CIO of Mankind Pharma
  • Mr. Chandan Pandey, Co-Founder and CEO of Quantinox Technology
  • Jose Motha, General Manager of Falken Tyre, India

These experts know that having an efficient ERP can be a decisive factor in the success of their businesses. But efficiency can only be achieved if the cloud ERP solution is implemented properly and offers what it promised. 

So, here are the questions that one must ask before implementing a cloud ERP solution. These questions are divided into three categories – Technical, Cost, and Implementation.

Category A – Technical Questions That You Should Ask Before Saying YES To a Cloud ERP

Mr. Pramod Gokhale has answered these tech-related questions.

Question 1: Ask yourself, what are your unique requirements related to Cloud ERP solution?

Answer: The very basic question that one must ask is “What are my pain points? What exactly am I trying to achieve by implementing the cloud ERP?” These requirements should be documented for a clear understanding.

In the same vein, one must also ask if the standard implementation of an ERP solution is enough for a company to fulfill its requirements. If not, does the ERP support plugging in extra add ons?

Question 2: Is your Cloud-based ERP solution as scalable as per my future requirement?

Answer: Many times we outgrow our ERP after a few years of implementation. Implementing a new ERP after every few years can severely hamper the business processes and overall budget.

Also, one must remember that scalability does not just mean scaling up. A good cloud ERP should also have the power of scaling down. As we have seen during the pandemic, the companies had to let go of many employees. The ERP system must be able to handle such scaling up and down.

Question 3: Security-wise, what are the things that we should be aware of?

Answer: You should ask your ERP provider – Which Cloud they are using and what is their security protocol? What will happen if there is a security breach, and what will be their data backup?

Category B: Questions Related To The Financial Aspect Of ERP Implementation

Mr. Chandan Pandey answered these questions.

Question 1: What is the Total Cost of Ownership (TCO) for the ERP solution in both platforms, On-Premise and On-Cloud?

Answer: Cost is the most crucial aspect of Cloud ERP implementation. You know some

businesses move to Cloud seeing that as the cost balloon, they thought simply deploying their ERPs on Cloud will cut the costs. However, they pay 20-50% of the extra cost due to increased usage, duplication of data, or the cost of synchronizing the data from on-premise to Cloud. So, it would help if you discussed with your vendor the Total cost of Ownership for both the platforms- On-Premise and On-Cloud.

Question 2: What will be the subscription cost of the ERP in the 2nd and 3rd years?

Answer: We must evaluate three things – Unseen costs, Subscription Coverage, and Actual Price based on the number of licenses and time.

  • We usually forget about the unseen costs like IT resources for managing the hardware, upgradation of infrastructure from time to time. Further, maintaining security and protecting the data from any damage would be a headache to manage internally. 
  • Generally, cloud products are subscription-based. While choosing a Cloud ERP, you should check whether all things are covered in the subscription cost, like license cost, annual maintenance cost, cloud infrastructure, implementation, customization, and support.
  • While opting for a cloud platform, consider how many user licenses you need to have for your company and how much time. And the prices should be inflation-adjusted.

Category C – Questions About The Implementation of Cloud ERP

Mr. Jose Motha answered these questions.

Question 1: What are your Vendor team’s skillset and industry-relevant experience in implementing Cloud-Based ERP solution?

Answer: To ensure that the cloud ERP implementation happens without a hiccup, the company has to evaluate the ERP company and vendor exactly how it evaluates a prospective employee.

Many questions need answering –

  • How user-friendly is the ERP?
  • How experienced is the ERP vendor?
  • How competent are the support staff of the vendor?
  • How much and what kind of support will I get from the vendor?
  • Does the vendor have ERP implementation experience in the industry that you work in?

These things should be clarified right at the beginning.

Question 2: What is your support cycle? Who will provide the support – Software Company or Vendor?

Support is something that is often taken for granted at the time of implementation, but if it is not as what you expected, you may not be able to stand strong during your downtime. As a business, downtime is something that can distant you from your customers. 

Thus, it is important to ask your ERP vendor: 

  • What all is covered in the support?
  • How the support is provided?
  • What will be the time zone for the support – would it be 24/7 or regular business hours?
  • What level of support will be provided – L1 or L2?
  • What is the SLA, like the turn-around time to solve a query?

Moving Forward with Cloud ERP with Confidence 

The industry experts reading this blog post – like yourself – already know the value of ERP. However, the time has come when the traditional boiler-room-based ERP is replaced with cloud ERP. By 2022 more than 90% of the global enterprises will have embraced the cloud model.

Keep these insights in mind so that the cloud ERP implementation in your company happens smoothly – not just during the process but also in the coming years. If you are planning to embark on Cloud ERP faster, we are your partner of choice. 

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    Nidhi Batra

    About the author

    Nidhi Batra is a marketing and brand communication professional with 10 years of experience working in the dynamic B2B marketing environment. She strategizes, writes, reviews a variety of content for demand generation and sales support activities. Having a Master’s in English from Delhi University, she knows how to navigate her readers on insightful journeys with her SAP published blogs and thought leadership content.