Key Opportunities in Moving from an On-Premises ERP to the Cloud

On February 7, 2023

Move Your ERP to the Cloud for Greater Agility, Security, and Compliance

Managing a global Life Sciences enterprise is easier when your employees can access the tools they need from anywhere, on any device.

Enterprise organizations have generally been reluctant to move their enterprise resource planning (ERP) systems into the cloud. After all, it’s a big commitment. And while 88% of ERP cloud migrations are judged to be successful, budget and timeline overruns can put a damper on about half of all implementations.

Life Sciences organizations, including Pharmaceutical companies, Biotech firms, and Medical Device manufacturers, are understandably hesitant to make huge infrastructure changes that could interfere with their mission-critical data and regulatory compliance efforts. On the other hand, putting off an upgrade from an on-premises ERP to a cloud-based ERP could add even more risk.

The good news is that many cloud migration problems can be avoided with proper advanced planning and the right cloud migration and validation partner.

Most enterprise organizations find that their biggest cloud migration challenge lies in creating a roadmap that includes primary use cases, a detailed infrastructure audit, future infrastructure requirements, security policies, and validation expectations.

Developing this roadmap requires cross-functional alignment from the top down, sufficient IT resources, and expertise in the desired cloud environment.

Buy-in is easier when the benefits are clear

When Life Sciences business leaders understand the advantages that cloud-based ERP solutions have over on-premises deployments, they generally become champions for system modernization.

Rebecca Wettemann, VP of Research at Nucleus Research, says that the “cloud is changing the pace of ERP innovation” and that the benefits of cloud migration are helping ERP solutions catch up to other software systems, such as CRM, that have already been migrated to the cloud. “Given the cloud benefits of lower cost, more flexibility, and faster deployment times, we predict cloud ERP will … quickly become the dominant solution,” she says.

Here are just a few of the benefits you can expect from a cloud-based ERP system:

  • Enhanced security, governance, fraud prevention, performance, and uptime
  • Better cross-functional visibility, process optimization, and a unified data model
  • Enhanced analytics and automation tools, such as machine learning capabilities
  • Retirement of expensive and outdated legacy infrastructure
  • More rapid scalability

These are important considerations for Pharmaceutical, Biotech, and Medical Device companies that need easy, day-to-day access to data that can facilitate productivity, accelerate timelines, and provide operational enhancements enterprise-wide, especially when it comes to mission-critical activities such as Clinical Research, Supply Chain Management, Quality Management, Weighing and Dispensing, and Advanced Warehouse Management.

Look beyond upfront costs to see where the value is

While upfront costs for migrating an existing on-premises ERP system to the cloud can be significant, they’re generally more than covered by reductions in licensing, staffing, and hardware maintenance expenses.

Through qualitative interviews with seven businesses that upgraded to a cloud-based deployment of the Microsoft Dynamics 365 ERP systems, along with subsequent financial analysis, Forrester found that a typical organization that migrates its ERP system to the cloud can expect benefits of $74.9 million over three years versus costs of $46.8 million. That translates into a net present value (NPV) of $28.1 million and an ROI of 60%.

Every great hero needs a guide

Luke Skywalker had Yoda. Harry Potter had Dumbledore. And you can rely on AX for Pharma to guide you through and beyond the ERP cloud migration process.

As a Microsoft Certified Gold Partner, AX for Pharma is uniquely qualified to help Life Sciences organizations modernize, migrate, and validate their ERP systems in the cloud.

We believe that Microsoft offers the best cloud environment, thanks to its powerful performance, familiar ecosystem, and the millions of dollars it invests each year in cybersecurity.

We also believe that to succeed in the cloud with a top-tier ERP system, Life Sciences companies need easily configurable modules that address their unique needs and regulatory requirements. Most cloud-based ERP solutions don’t include the necessary components for Pharmaceutical, Biotech, and Medical Device companies, and, for too long, these organizations have had to perform costly and complex customizations to their ERPs.

Fortunately, the Life Sciences and ERP experts at AX for Pharma have developed a powerful GAMP 5 Category 4 (configurable) solution with the industry-specific modules you need right out of the box. The solution is purpose-built for Microsoft Dynamics 365 and is designed to ensure full compliance with GxP guidelines.

Finally, because cloud-based solutions are regularly updated, Life Sciences companies need to understand that they’ll need ongoing validation services to make sure the system remains fit for its intended purpose, maximizes patient safety, and minimizes risk. Validation services include:

  • Risk Assessment during upgrades
  • Configuration Management
  • Regression Testing

While this can get complicated, AX for Pharma automated much of this work to help clients maintain a validated ERP system as efficiently as possible.

For more information or to schedule a Migration Assessment Workshop, please contact us at [email protected] or +1 (813) 365-9576.