Okay, you’re sold on the need for cloud ERP. Now you just have to talk your organization into it.
Most business leaders don’t buy into IT projects. They certainly don’t buy into ERP upgrades when an old system is still running faithfully. What they do buy into is risk reduction. They buy into cost-cutting and revenue growth. They listen when you talk about ways to unlock business growth.
This is how you sell a cloud ERP modernization project. You build a business case based on outcomes.
There are several good reasons why executives should consider cloud ERP modernization. While your organization might have additional reasons, the business case for a cloud ERP upgrade project starts with these common business considerations.
It can feel like a legacy ERP solution is done and paid for, but actually it is an expensive, ongoing cost center for a business. That’s because the software itself isn’t the only cost associated with legacy ERP.
Businesses that use legacy ERP suffer from several expenses that just aren’t there with modern cloud ERP solutions. These include custom-code maintenance, ongoing software upgrades, and the need for IT staff to babysit the system.
Then there are shadow costs such as downtime and performance issues that come with legacy solutions, and missed business opportunities associated with legacy solutions holding back decision-making though the lack of complete, real-time operational visibility.
The low-hanging fruit is that relying on legacy systems creates risk. Operational capabilities can break at any time, especially if a business relies on old hardware for running their legacy backend.
An even larger risk today is the lack of agility, however. Technology drives modern businesses, and both technology and business models are changing fast with the rise of artificial intelligence.
Modern ERP solutions such as SAP Cloud ERP are flexible, AI-native solutions well placed both for today’s technology and what’s to come. Some of this technology change can be bolted onto legacy ERP solutions, but fundamentally, it can’t keep up. Older systems were not designed for AI agents and cloud-based operational models.
Continuing to use a legacy backend is risky. A business can easily fall behind or adapt too slowly when it relies on old technology.
A business needs the foundation for growth. The modularity and elasticity of Cloud ERP support not only where a business is today, but also where it is going tomorrow in terms of business expansion, transaction volume, and new lines of business. Legacy ERP holds back a business while cloud ERP paves the way for the future.
“Can your systems support where you want the business to be in two or three years?” asks Christopher Beck, who was responsible for shaving supply unicorn Harry’s cloud ERP migration as its global head of IT. “It is always challenging to plan ahead. But try to aim for that as opposed to playing catch-up after the fact.”
Read more about Harry’s ERP journey
Modernizing with cloud ERP frees up internal IT resources for more strategic work. When a company’s backend is running in the cloud, there’s less need for software and hardware maintenance. IT staff also doesn’t have to babysit legacy systems. This frees them up for more growth-oriented projects and operational improvement.
Non-IT employees also focus on higher-order tasks when a business uses cloud ERP. There is greater levels of automation, and AI agents can carry out tasks on behalf of employees. Cloud ERP is employee enablement.
A flexible, connected cloud ERP backend will dramatically improve operations across the company. Financial close happens faster with cloud ERP. Widespread automation cuts down on human error and manual processes. Real-time data improves inventory management and sourcing. Full operational visibility enables better pricing and margin control. Among other benefits.
It doesn’t take long for you to find concrete examples of how cloud ERP can improve operational performance.
Don’t sell cloud ERP as an IT project. That’s not compelling. Show that modernizing with cloud ERP is actually a business transformation project.
When a business moves from a legacy solution to cloud ERP, it significantly transforms its operational efficiency, its capabilities and its growth path. Even if an organization is well established, cloud ERP helps it move like a startup and reinvent both operational processes and lines of business as the landscape evolves.
For help establishing the benefits of cloud ERP for your organization, including concrete data you can take to your executive team, contact one of our experienced consultants by calling (801) 642-0123 or by writing us at info@nbs-us.com. We’re happy to help.