Editor's Note:Lee An Schommer is Chief Product Officer and GM of FP&A at insightsoftware. Headquartered in Raleigh, North Carolina, insightsoftware provides software tools for finance, accounting, and operations teams. The views expressed in this article are solely those of the author.

Migrating financial data to the cloud may seem daunting at first—it requires investment, careful planning, and may temporarily disrupt daily operations. However, the long-term benefits of cloud-based Enterprise Resource Planning (ERP) systems will ultimately make these initial challenges worthwhile.

These benefits include lower operating costs, streamlined and automated processes, and increased agility for finance teams—all critical competitive advantages in today's economic environment.

According to research released by insightsoftware in September, only 27% of finance teams have fully migrated to the cloud; 62% operate in a hybrid model, using both on-premises systems and cloud applications; and another 11% rely solely on on-premises infrastructure. Of those that have not yet migrated, 42% plan to begin within the next year, and nearly 50% plan to complete the migration within the next two years.

Cloud computing has been around for years—why are some finance teams only now embarking on the migration journey?

First, vendors and legacy platforms are pushing customers to the cloud. Second, implementing a new ERP system is a major undertaking; challenges such as deploying new technology, migrating legacy data, and training cross-departmental staff all require significant time and resources.

Although some initial productivity dip during the transition is inevitable, the right strategies and tools can minimize disruption and pave the way for a smoother, more successful implementation.

Reducing Migration Risk

Planning is a crucial first step. The data migration process is fraught with complexity and risk, such as downtime, especially in hybrid models where data consistency between on-premises and cloud environments is vital.

To ensure a smooth transition, prioritize the following:

  • Robust Data Backup:Implement a comprehensive data backup strategy to guard against unexpected setbacks or data loss during migration.
  • Strategic Data Assessment:Identify critical data and prioritize its migration to ensure important information is immediately accessible in the cloud environment.
  • Data Accessibility and Transformation:Ensure data can be quickly accessed, integrated, and transformed to meet evolving business needs.

Maintaining reporting consistency is critical. Regardless of what stage of migration the IT team is in, organizations need to remain responsive and make data-driven decisions under tough economic conditions. Best-of-breed solutions ensure consistency in financial and operational reporting before and after migration, supporting self-service, customizable reporting that keeps the organization always prepared.

Choosing the Right Software

Selecting the right cloud ERP solution is key to migration success. From an innovative roadmap to early delivery of AI capabilities, the right ERP helps organizations scale. But equally important is ensuring you get maximum value from your investment. Although the native reporting capabilities of cloud solutions have improved significantly over their on-premises predecessors, many adopters find that self-service reporting remains difficult to achieve due to complexity or cost. Best-of-breed solutions help ensure these investments deliver the ROI you need.

When making decisions, carefully consider business needs and goals, software integration capabilities, implementation processes, and the importance of an intuitive user interface—the latter can shorten your team's learning curve.

Empowering Teams

Cloud ERP adoption offers organizations of all sizes an opportunity to reshape culture and break down silos between teams and data. As more organizations bring more lines of business into financial strategy, adopting new technology becomes a key opportunity to enhance productivity, collaboration, and resource efficiency.

Providing employees with comprehensive training on the new ERP system early on is critical for a smooth transition and sustained productivity during migration; at the same time, increasing employees' ability to work independently with the new system frees up organizational technical resources, allowing them to focus on other optimization efforts, such as implementing AI initiatives.

Migrating from on-premises ERP to the cloud represents a significant shift, especially for finance teams that may have relied on the same processes for years. Effective training empowers employees to identify areas for productivity gains, including easily and flexibly customizing financial views and reports, providing the organization with critical financial data.