FAQs when migrating from an on-premise to cloud based Enterprise Resource Planning (ERP) System

1. Why are there more contract documents involved in a cloud-based ERP System? Isn’t this just lawyers over-complicating the issue?

Most ERP providers offer their software on standard terms, taking a ‘one size fits all’ approach to all customers. Implementation is often carried out by an implementation partner.  This often results in two contracts: a SaaS Contract and Implementation Contract. This can simplify contract management as the implementation contract falls away once implementation is complete.  This structure relies on a clear delineation and articulating clear dependencies between the two suppliers.  A collaboration agreement can help with this.

2. Will there be any implementation and data migration time required?

Although not a traditional implementation, there will be some implementation and integration work to do to ensure that your organisation can access the ERP software. This is often reserved for a specialist ERP implementation partner.

3. How can I ensure that the end product is user-friendly?

A key concern will be whether the ERP system purchased will be fit for purpose and user-friendly.  To address this, the contract documents should clearly articulate the goals of the project and the high-level benefits that are sought i.e. the “Product Vision”.  The use of ‘user stories’ and user demonstrations can also capture what the end user wants to achieve.

4. Can I specify what the key performance indicators or service levels should be?

Service performance arrangements are usually standard and non-negotiable, and sometimes not included in a supplier’s standard terms at all.  Depending on the breadth, buying power and business criticality of the service, it may be possible to agree enhanced service performance arrangements with the ERP Provider, which we have successfully negotiated in the past for our clients – as our case study demonstrates.

5. How can I be confident that my data is securely protected in a cloud-based model when previously it was located on physical servers?

Trust in cloud-based systems is improving.  However, where data is located and stored, how it is kept secure, how it is used, and how it can be safely migrated are all issues that need to be properly considered.  Early engagement with your data protection officer and information security teams will be vital to ensuring that you purchase a product that safeguards your data in an acceptable way.

This article is for general awareness only and does not constitute legal or professional advice. The law may have changed since this page was first published. If you would like further advice and assistance in relation to any of the issues raised in this [article][blog], please contact us today by telephone or email  enquiries@sharpepritchard.co.uk.

Posted in Enterprise Resource Planning.