Migrating from Microsoft Dynamics AX to the Cloud: Advantages and Considerations for Life Sciences Companies

On January 19, 2022

As pharma faces increasingly complex compliance standards and fierce competition, many companies are at a crossroads. Technology is driving the industry and while a decade ago the cloud may have been considered risky, quite the opposite is true today. Legacy technology is putting life sciences organizations at risk and holding them back from the efficiencies, security, and innovation they need to be a market leader.

This article will help you identify the biggest risks of remaining on legacy, on-premises Microsoft Dynamics AX systems as well as highlight some of the benefits you can expect by migrating to a cloud Dynamics 365 ERP platform and unified infrastructure.

What are the risks of staying with Microsoft Dynamics AX on-premises systems?

Reduced agility: You are limited on how or if you can scale your organization up and down as needed without interrupting current business. This includes functionality, capacity, number of users, etc.

Less flexibility: User access to data is limited to specific locations and equipment on site and during regular hours.

Inadequate security: Most organizations struggle to keep up to date with the latest security concerns and breaches and do not have the internal skills and software tools required to adequately protect data.

Costly disruption: With all IT centralized in one place, your organization is vulnerable to interruption of service due to power outage, hardware or software issues, network problems, or other disaster. It is difficult, or impossible, to access a backup and perform disaster recovery in a timely manner.

Expensive maintenance: There will be a point where you’re spending more money to maintain your legacy systems than you would if you had upgraded your systems to a modern infrastructure.

Non-compliance risk: Regulatory standards must be followed and your technology must be supported to prevent fees and penalties for data breach (security holes), increase of downtime, loss of clients, data, etc.

What is the value of moving to Microsoft Dynamics 365 for pharma organizations?

In the Forrester Report, The Total Economic Impact™ of Microsoft Dynamics 365 Finance and Microsoft Dynamics 365 Supply Chain Management, seven enterprise organizations were interviewed that moved legacy systems to Microsoft Dynamics 365. Quantifiable improvements as a composite average across the seven represented organizations include:

  • 60% ROI with payback in 20 months
  • Savings of $39M in operational efficiency
  • Savings of $20.6M in employee productivity
  • Increased wholesale/retail profit of $4.6M
  • Avoided $10.6M in legacy system costs

For pharma, there are specific advantages and benefits of the cloud that have become mandatory to enable growth and innovation into the future, such as:

Maximum agility: Cloud ERP solutions enable you to stay agile and competitive as you can scale and align your  technology aligned to your organization’s growth or need to downsize.

Lower cost of ownership: With lower upfront costs required to implement world-class technology, you can reduce your capital expenditures and shift funds to more strategic growth initiatives. License costs are flexible and affordable so you can improve access to everyone who needs it.

Best-in-class security: Cloud vendors like Microsoft lead the world in security and privacy. You automatically inherit leading security systems and controls helping you stay compliant with no additional costs or IT resources required.

Built-in disaster recovery: Eliminate the concerns and risks of disruption in the face of disaster. The cloud offers always on disaster recovery and data redundancy so you can be back up and running quickly to minimize downtime and data loss.

Anytime, anywhere accessibility: Remove the constraints of accessibility tied to specific locations and equipment by providing staff with easy, secure access from any location or device.

How do pharma companies prepare to migrate to Microsoft Dynamics 365?

AX for Pharma specializes in helping life sciences organizations migrate from Microsoft Dynamics AX on-premises systems to a unified Dynamics 365 cloud infrastructure in a practical, phased, methodical manner. Within a highly regulated industry, it is critical that your Microsoft Dynamics cloud solutions partner bring advanced expertise in life sciences and pharma compliances and processes.

Here are a couple of critical components of a Microsoft Dynamics cloud migration for pharma companies:

  1. Develop a Focused Microsoft Dynamics Cloud Migration Strategy
    1. Create a practical strategy to gradually migrate systems and data to the cloud
    2. Analyze the impact of any dependencies (web services, storage, third-party software, etc.) before migrating all the workload
    3. Leverage proof of concept (POC) to have better clarity and understanding, including:
      • Performance comparisons with your existing application
      • Network challenges that need resolved
      • System reliabilities and availability
      • Cloud provider support evaluation
  1. Validate the Cloud Migration
    1. Functional validation
      • Perform end-to-end application function validation
      • Regression testing over the cloud
      • Service integration with other applications
      • UI working as expected
      • Cross-platform compatibility is ensured
    2. Integration testing for third-party applications
      • Very all interfaces and related systems are tested and covered
    3. Prepare Disaster Recovery and Business Continuity Plan

The validation must be based on the risk level of the application

  1. IQ simple and based on hardware & software requirements for the system, the IQ of the vendor can be leveraged
  2. OQ to verify critical high-risk systems:
    1. Security, data integrity
    2. Audit trail
    3. Electronic signature
  3. High and medium risk requirements
  4. PQ to verify the workflow & business process requirements

What are your next steps for a Microsoft Dynamics 365 cloud migration?

The first, and most important, step you can take is choosing an experienced and reputable Microsoft Dynamics life sciences technology partner to guide your cloud journey from end to end. AX for Pharma is an ISO 9001:2015 certified Microsoft Dynamics 365 partner and global systems integrator with a global team of life sciences experts.

From implementations to Computer System Validation (CSV) to our AX for Pharma 365™ industry ERP solution built on Microsoft Dynamics 365—you can depend on us as a strategic partner for all aspects of your transformation.  Contact us today to discuss your goals and your next steps.