5 Reasons Your Second ERP Migration Is Easier Than Your First

Peter Nicholson (00:24)
And welcome back to the ABCs of ERP and Beyond, the show that looks at ERP from three different seats. Most ERP advice comes from one chair, the partner who sold it, or the user who got stuck with it. And we try to triangulate that. We have Nirav Shah, he gives you the VAR's view. He's AdCirrusERP and implements this for a living. And I come from the nerdy data and system side.

inside a business that runs one day to day. And Emily Browning, who keeps us honest on business process and project management, the people and the workflows these systems are actually meant to serve. She can't join us this week. So you've got two of the three seats today, the partner and the data side, which for this particular topic is convenient.

Think back to your first ERP go live. And if you just winced, well, this episode is for you. Every prospect meeting has that one person, arms folded, the thousand yard stare still processing something that happened all those years ago. And they know the current system's failing. Everyone hates it, but we are not going through that again, is what they say. So today we're making an argument. That project

Nirav Shah (01:21)
Mm-hmm.

Peter Nicholson (01:35)
That person is dreading no longer exists. Your second ERP migration isn't the first one repeated. It's a different project, but just with the same name. The integrations are APIs now, not custom code. We now have cloud. Data is coming out of a proper database and not on the big spike with all of the tickets on that we all have remembered from yesteryear. So

There's a few ways that ⁓ you can still squander that advantage. and we're also going to speak about how to avoid those and what to actually do this quarter if your ERP does indeed suck. So without further ado, Nirav welcome back.

Nirav Shah (02:10)
Thank you, Peter. wow, that was a great intro right there. It was pretty phenomenal. I was like, you basically covered the whole podcast right there in that intro introduction. so kudos there, Peter. Yes, absolutely. this is a this is kind of flipping, I feel like, not flipping the ERP implementation on its head, but you're just you're you're just kind of looking at it from

Peter Nicholson (02:21)
Thank you. I write it all myself.

Nirav Shah (02:34)
The lens of doing it again, right? And when you're in it, and those of you that have listened to the podcast out there, and hopefully found a lot of really good tips and valuable insight on on successfully managing your first ERP implementation, it could feel like you never want to do this again. And it is a heart transplant, right? We we we talked about that earlier in one of our previous episodes.

But unfortunately, even you know, what do they say? Like if even if you get a heart transplant, you kinda have to not hopefully do another heart transplant but you to kinda go under the hood and take a look at it again and hope you don't put your name on a list another one. That's kind of pr a little bit extreme there. Hopefully no one has to go through that. If you are ⁓ sympathetic, definitely. ⁓ but

Peter Nicholson (03:11)
Mm-hmm.

Nirav Shah (03:15)
There's gonna be a point in time, maybe, right, with technology, that you're gonna feel like, hey, this brand new shiny thing that you got bought 15, 20 years ago is kind of dusted now and is not providing the ROI anymore. And you got a new team in, or you want to take advantage of new technology, and you're gonna be thinking to yourself, like, hey, we should be looking at another system, right? And

A lot of times that conversation just doesn't come out in the forefront. I think there's, you know, there's too many, too, too much ⁓ scar tissue built up from the first simple ERP implementation. People are carrying on war wounds, right? from the from the first time they did it and they just don't even want to hear that word again. But think about this, right? With anything that you do in life, anything that you do in general, second time around ends up being a little easier.

Because you know a lot more. Right. And that could help you become more successful the second time around. And like I said, a lot of times, you know, you're doing these big system changes for for specific business objectives and and and reasons. and this period in time right now, I feel like is a perfect example with.

You know, we'll talk about this a little more. We have AI, we have these integrations, we have all this capability in software that never existed before. Existed, but it was costly. A lot of customers the the cost was so far that small business couldn't take advantage of it, right? And now the costs have come down tremendously. And a lot of companies are thinking this like, hey, should we go through a and look at another ERP system? Is it time?

But is it gonna be as hard, right? our team went through it f twenty years ago and it took us a year, year and a half to stabilize.

Yeah, that kind of comes with the territory with the RP implementations, unfortunately, right? You're this is a big change, a big system change, big business change. But doing it the second time around, is it easier or harder? I think that's the question here today that we're looking to help viewers out there, listeners out there solve, right? Or understand. My opinion, kind of spoiler alert, I think it's a bit easier to do it the second time around. There's certain there's certain reasons why, Peter.

Peter Nicholson (05:20)
I think it's definitely easier the second time round. I think although I will say I think there's new there's a new minefield that comes with it. There's new risks, I think, if you're moving from old ERP to new ERP rather than no ERP to your first one. There's a different set of risks, which we'll get to. But overall, I completely agree that it is easier the second time round because for me, I think that first time round is that first real conversion of of

business processes into data, into systems processes and turning all of those disconnected spreadsheets and finance in QuickBooks and inventory sat on someone's Microsoft Access Database, all of that data has been turned into a single system database, right? So now your second one, you're just turning data or converting data into data, right? It's just a s it's almost just a schema shift, a schema to schema shift.

Nirav Shah (06:11)
Yeah. Yeah.

Peter Nicholson (06:15)
which is a different set of skills that you would do from ERP migration from from one to to another one. it's it's that schema shift rather than the cabinet full of physical pieces of paper shift, which is a lot harder. So just the very nature if I of course the data guy starts speaking about data within the first thirty seconds, but but for me that data migration is so much easier.

Nirav Shah (06:29)
Yeah. Yeah. Yeah.

Peter Nicholson (06:39)
⁓ and we'll get into this, right? The tools are available for for data migration that we didn't have. and I even think that it's easier now more than ever, even if you were looking at something fifteen years ago, moving on from your first ERP to your second ERP fifteen years ago, that compared to doing it in modern times, it's so much easier now than it was ever, right? So ⁓

Nirav Shah (06:51)
Mm-hmm.

Yeah.

Peter Nicholson (07:03)
I think we're gonna get into this and and I think this is a good episode to cover because we know that there are a wave of ERP out there that are coming to a point where you're going to have to move. They're coming end of life. We know GP, thank God, is is finally being ⁓ being sunsetted or at least Microsoft is ending support. ⁓ well or they have done, but I think it's gonna be completely dead, no updates or anything in the next

Nirav Shah (07:18)
Mm. Mm mm.

Yeah.

Peter Nicholson (07:30)
three years, I think, or something. I've given it three years worth of life. Now, when we're talking about an ERP and we're saying, well, this is done every ten to fifteen years, you've only got three years left of GP, you're gonna be forced to have to do something. ⁓ I know I came from classic nav, classic nav, talking the primitive days, but even things like Nav 2018 right now is is it's been extended, but it's a ticking

Nirav Shah (07:32)
Yeah. Yeah.

Mm-hmm.

Mm-hmm.

Peter Nicholson (07:54)
time bomb, you're gonna have to do something. So I think there's gonna be a few people that are gonna get some value out of this that might be doing this for the first time. It's their first ERP migration from being on an existing ERP. So I think that's really interesting topic.

Nirav Shah (08:07)
Yep.

Yeah, it's almost like going back to GP here. You know, Microsoft had GP for such a long time. Now GP's gotten old and it's now gone to college and it's on the workspace and it's no longer allowed back in Microsoft's house anymore. It's a Yes, yes, yes. It's in the nursing home ready.

Peter Nicholson (08:23)
No, it's it's in the old people's home. It's beyond college. It's the angry man that keeps shouting and it's somehow still alive.

Nirav Shah (08:32)
Yeah, exactly. I feel like it's not allowed back to the house anymore. It has to kind of like, you know, you know, figure it out. And it's maybe on hospice care at this point. and ⁓ eventually it'll go away completely. But yeah, there's a little ton of solutions out there that and I but but I also feel like maybe that infrastructure just wasn't built from modern times, right? and as a publisher, you gotta make the decision do we have to, do we continue going down this route? And

Peter Nicholson (08:42)
Yeah.

Nirav Shah (08:58)
You know, redo the whole framework if it's not gonna really be productive or have another solution behind it, right? Like what Microsoft does with Business Central. beyond GP. So yeah, I think I think you make some you make some very valid points there. And when you start looking, we did an episode very similar to this again, migrate or upgrade, right? but when you do decide, let's say, you know.

We're gonna go ahead and move move on and we're gonna go to a second ERP system. I think it is easier to move on and and jump on the next system. You know, you're smarter. You know what d gaps your data has. So, Peter, you're explaining about your data schema, right? You know which gaps you wanna fill there. ⁓ you know how you wanna keep your data clean. You know

You know, how you want to report on your data at the end of the day, right? So that is a huge step forward. Remember, recall, if you can, your first ERP migration and where data felt like such a foreign thing to you know, concept and how to clean data. You just took your data out of QuickBooks, you took your data out of Excel, you took your data out of you know, whatever systems you're using, you just dumped it. As much as you wanted to clean it, you couldn't have time to clean it, you couldn't clean it, and you were scared with the new processes that the ERP system was.

Was was providing you wanted to do exactly what you wanted to do in your old systems and the new ERP system, that's kind of how you bought your data over, right? And you're still maybe living with some of that data issues because of the way you brought your data over the first time, but now you're smarter. And now you know that if you took the time to clean your data, and now you know how integrated systems work now, right? you know the type of changes you want to make to your data. So that first thing when it comes to data migration.

To your ERP, second ERP system, I think is going to be a lot easier from that perspective. And layer on top of that, all the different tools are available to help you organize your data, extract your data easily, import your data easily. The different iterations you could keep testing that data in the new ERP systems because these new ERP products are capable of that turnaround pretty pr pretty quickly. So it's no longer a

one time or two time mig data migration. Data migration and ERP project nowadays are continuous throughout the whole project. You could migrate your whole ERP file, your whole data file, seven, eight times throughout the whole project, right? Until you feel comfortable. So it's just, you know, that that's kind of what I'd say on that piece of it, that it just it does make that data migration pace easier when you're coming off of

already an ERP system, you know what you're missed out on, you know how you want your data now, you know how all the departments work together and you know how you want to bring that data into the new ERP system.

Peter Nicholson (11:35)
Yep. And you would have learnt a bunch of lessons on even the initial setup, right? We know that every project tends to be focused on finance first of all. You setting up all of the correct GL accounts and posting groups and posting classes and item classes and all of that fun stuff. it's easy when you're moving on to your first ERP, it's easy to go slightly overboard and almost slightly granular. When you're like, wait, I can have material variance GL account different from purchase price variance d

Nirav Shah (12:00)
Right.

Peter Nicholson (12:02)
⁓ a landed cost bucket and all of these separate things? Yes, you can. And then you go super granular. And then twenty percent of those never never get a dimes thrown in that into that GL bucket. So it's you've got a lot of learning to do when you move from that first one to your second one because there are going to be some skeletons that you've you know stumbled upon when you're starting to look at ⁓ what data you have and what's actually been utilized in your in your current setup.

Nirav Shah (12:08)
Yeah.

Peter Nicholson (12:28)
⁓ but I think we should start the there's three phases or three acts to today's episode. So let's go straight into act one. Act one is all around reasons why this this round two ⁓ is structurally easier. And you've already started to mention this that when we're talking about data migration, ⁓ it's significantly easier than the first time round. And I would also say it's significantly easier.

these days as well because your first ERP migration was all around getting stuff out of spreadsheets, getting hold of that tribal knowledge, and putting it into the ERP. The second time around, data migration, there's tools out there. And I would actually say that migration tooling these days, it it's awesome. It's really, really good. It's actually beyond good. I would say that a lot of ERP companies use their migration tools

Nirav Shah (13:11)
Yeah. Yeah.

Peter Nicholson (13:16)
as a competitive advantage because they want you to be able to migrate to their solution so much easier than anyone else. So I think any kind of ⁓ ERP vendor or ERP publisher will have the tools that are competed against everyone else, almost to the point where they'll get to a a single click or even a migration agent if we were well look, we're just over ten minutes in. Migration agent, an AI agent

Nirav Shah (13:43)
Agent.

Peter Nicholson (13:45)
AI has been mentioned

Nirav Shah (13:44)
Wow, Peter.

Peter Nicholson (13:46)
already. I've s I've said data, I've said AI. But there is for me this is this is where it's going, right? This is a competitive advantage. Like if I can sell you my ERP by saying ha look how painless it is just to move on it. then you're gonna start kind of get more people onto your ERP. So

Nirav Shah (13:49)
Wow, migration agent. That's interesting. That's interesting. Yeah.

Peter Nicholson (14:05)
But I think inherently it it simply is easier in terms of data migration because of the modern tooling that we actually have. most ERP companies want to leverage open format of data as well. They they used to go proprietary,

Nirav Shah (14:05)
Yeah.

Peter Nicholson (14:20)
Now suddenly everyone wants it open. Open source. Delta Parquet. Normal database tables. The data's yours. You know, they want to make it as easy as possible. So ⁓ this is a great advantage I think for this this this round two of ERP migration. Thoughts? That was a lot.

Nirav Shah (14:29)
Mm-hmm, mm-hmm.

Mm-hmm.

Yeah, no, I think, I think that's there's the possibilities and tools out there are endless, right? where when you did the first time, it was just you and the partner. And you had to do what the partner said. And the partner gave you some direction or or told you how your items were going to be set up or how your customers should be set up, right? And you took that.

face value and you went ahead and set your system, but then you realize, hey, wait a minute, you know, we could have also done X, Y, and Z, or you know, we wanna we had a you had a change in ways that you want to maybe do something now you're an integrated system. And you're stuck and you couldn't really change it in your current ERP system. And you'd live with it for 15 years now. And now you have this chance to you know get unstuck and ⁓ change that around. But you know how do you do that? Now you have these AI tools and you have, you know, ⁓ you know Excel and you have these sophisticated

you know, solutions that are just meant to clean data and to to help you get to point A to point B in a more educated way. where before you were you were just trying to figure out which way was up when you're going through an ERP ERP migration. So you you brought up you brought up some really, really good points there on that. And I also want to, you know, talk about Act One, right? Migrating between two systems. The part that also gets, I think

⁓ left out or doesn't get enough Credit is just like the people knowledge, right? The the knowledge that the users have developed in managing an ERP system.

And the second time around, that knowledge is so helpful. If you just gathered your team tomorrow and had a discussion, like, hey, we're ready for a new ERP system. you know, what have we learned from our current ERP system? What do we want from our second ERP system? You will be blown away. They understand ERP, they've researched it without even the project managers knowing or even the owner knowing.

you know, on, you know, certain processes, certain functionality. because whether they've told you or not, they've embraced it. They've embraced their functions, they embraced their processes in the ERP system. They understand how that, you know, how other people's work impacts their process and their day-to-day work. So them knowing coming into your second ERP migration is gonna make that transition easier. And they're gonna come with more.

positive feedback and they're gonna come with ways to even make your processes more efficient. Maybe there's limitations in your older, older ERP system that you couldn't get past. And with the new ERP system, you can. So, you know, it's that's an important point. It's the people part of this. We talked about data, right? we're gonna talk about integrations here shortly. and and we'll talk about you know how cloud could help you, these type of things, but the people is, in my opinion,

the one of the biggest assets of going through your second ERP project is because they know what they want and what they don't want at the end of the day.

Peter Nicholson (17:19)
Yeah,

I that's so useful because it's the people it's nothing else will you find on paper the fact that it takes someone twenty-one clicks to reprint a work order. you don't even find it in a flashy demo, because I would have set it up so it's like a a click of a button. I actually watched this a couple of weeks ago watching someone on an old ERP.

Nirav Shah (17:34)
Yeah.

Peter Nicholson (17:38)
⁓ it's just astounding that it I I looked 'cause they did it a couple of times, but I counted it the second time because I thought, hmm, that was a lot of clicks. There were twenty one clicks to look up a work order and go and reprint that as a PDF to screen. Twenty one clicks and four fields to type in, like part number, just to reprint an existing work order in system.

Nirav Shah (17:44)
Mm-hmm.

Right.

Well

Peter Nicholson (18:01)
And you won't find that anywhere, other than the people, the people that know this. and I think also this is on the people driving the ERP migration to really challenge people because those end users, they're doing those twenty one clicks day in, day out. And they get so so used to it, it's to the point where they don't even realize you need to help them step back and go that you surely aren't can't be happy with it.

That you do know that it takes you twenty one clicks to do that and I've been watching you for thirty seconds. Because they'll soon go, ⁓ I've never really thought about it because they're working on muscle memory. So I think it's really interesting. I think Emily said this a few episodes ago about timing people. When they say, yeah, it's pretty quick. Well no, let actually time it. Five minutes, half an hour, multiplied by the number of times we do it. ⁓ so speak to the people because they're gonna be telling you how much time is going into

Nirav Shah (18:28)
Mm-hmm.

Mm-hmm.

Hm.

Peter Nicholson (18:51)
operating the ERP. and we know we know look at any look at BC, look at Acumatica, look at any of the modern day ERPs. there's no process that takes 21 clicks to print an existing document in the system, whether that be an invoice or a work order or a sales order. Nothing is nothing is twenty one clicks away.

⁓ let's move on. it because you said it. Integrations. So this is the one that people are gonna wince at. Integrations fifteen years ago was a developer customization. There's no way to connect directly. We're gonna have to do something funky. ⁓ what does that look like second time around in the modern world?

Nirav Shah (19:28)
Yeah, integrations are so far ahead, light years ahead. If you implemented your first GRP system, you know, back in the, you know, let's say it was two thousand two or two thousands, right? You implemented it and you wanted to integrate even to like Shopify. You want to integrate to your e-commerce platform and and or you want to integrate to like a WMS system. It just didn't exist. It it it's too hard. It was too out of reach.

For talking about the SMB market, right? Maybe enterprise had that already. And you know, if you're maybe in the F and you know the AX at that time, right? You're implementing AX or you're implementing SAP or Epicor, Infor, some of the bigger tier one solutions. But if you're looking at tier two and you're a small to medium sized business, that just was out of reach. You could not. That first of all, that technology was out of each. Number two, I don't even think the SMB market really understood what WMS was at that time.

Or how it could help their business, right? and then you have these ⁓ iPaaS solutions that are out here now where you could integrate to not only all, you know, Shopify Amazon, Big Commerce, Walmart, right, eBay, Etsy, but you could take other solutions. You could have a homegrown or just like a very proprietary invoice portal that your that your customer uses. You integrate into that, right, very easily. As long as there's like you're like you're saying REST APIs and

the the the source and target databases have open APIs as well. It's pretty easy to map out now. Like it's not rocket science. And you could get up and going within 15, 20 hours of work, have a full blown integration at the end of the day. So, you know, where you had some limitations in the past and maybe you still are dealing with those from your first ERP implementation, your second time around, you can have a lot more availability of different types of APIs and

open source and integrations that you need to do to successfully bring in data, export data, customers, vendors, to be very efficient in your business. You're not having to double key things in, you know, rely on manual imports or FTPs, stuff like that. It just could become automatic. So, you know, I think like what a lot of people don't understand, especially if you're just in a single ERP system, is that this is

A such a huge advantage just to move off of your current ERP system, move to the next one, because that next one's gonna set you up for another 30, 40 years, where your current one is probably setting you back right now in what you're doing. So think of it as, you know, how you could instead of spending it's like a car that's 130,000 miles, your timing belts about to go, your you know, you you you have your differentials about to go.

Right. You have to do a full trans flush now, right? Just to get it back on the road. Like, do you want to spend money on that? Or does this make sense to get a brand new car and have that warranty with it and all the new features and stuff that you don't have to maintain that you had to maintain in the past? AKA EV cars, right? And move on. So it's a decision. Yes, obviously. That's just an analogy that I'm making, but it's kind of the appropriate analogy nowadays. you know.

Why keep limiting yourself and doing things manually when there's this whole new world out there?

Peter Nicholson (22:33)
Yep. I agree. moving on. this is a big one for me. this whole cloud. Everything's off in the sky now. If we think about ERP number one and that implementation, right, that always came bundled with basically an infrastructure project. We're talking on-prem servers, a server room air conditioning.

SQL licenses, VPN, ⁓ VPN clients on all of your end users, a backup plan, immutable backups, off site backups, the disaster recovery plan that quite frankly no nobody's tested. We know this. compared to a modern ERP software as a service, ⁓ saas it's just provisioning a login. That that's all you've got to do.

Nirav Shah (23:15)
Yeah.

Peter Nicholson (23:16)
And even when we're talking about testing and stuff, all it is is a sandbox. It's cheap, refreshable, just spin it up, and and off you go. ⁓ so you get immediately you get a copy of your live, and you know, you can you can have at it and and also this the the whole idea of cloud is ⁓ on your second ERP, the fact that when a a major update comes, then it's just a simple or even the incremental patches.

it's just a case of just patching it. That's it. Just patch it, just upgrade it. ⁓ and this is something your vendor can do. There's no worry about any kind of on prem servers. What happens if we what even happens if we have a power cut? And actually I'm gonna this is an aside, but I I think back to the first time we moved on to cloud. Everyone immediately was like, What? So I log in on a browser? Like, yes. Okay, but what if the internet goes down? Like how often has that happened?

Nirav Shah (24:10)
Even if it does, you have Starlink. Elon has helped us and blessed us with some amazing, with some amazing internet connection. Doesn't matter where you are. Elon, if you're listening, you know, wouldn't mind a shout-out here, spot a spot in the ABCs of ERP and beyond.

Peter Nicholson (24:08)
Here. maybe once a year, twice a year.

We're not advertising Elon Musk.

We're mere peasants. We need some help from a trillionaire. Please just just donate a billion pounds and we'll be fine. You want a billion? I completely lost my train of thought. Starlink. Yeah, so how many times does your internet go down in the office? Once or twice a year. think about how many times your server went down in the office. Now your server went

Nirav Shah (24:29)
Yeah. ⁓

There's your p there you go, there you go.

Ha ha.

Yeah. Yeah.

Peter Nicholson (24:48)
Down hardly any times, but it's easy to think about those emails sent round to everyone. we need to do some maintenance, it's going to be down for a couple of hours, Or you know, we need do our monthly maintenance, right? That was always a thing where we had to kind of during these hours it won't be available. All of those are downtimes, but people just think about well, the server never went down.

Nirav Shah (25:07)
T are you talking about Windows patches?

Ha ha ha.

Peter Nicholson (25:12)
But the server never just like randomly went down. It was intentionally shut down month over month to do something, to do some maintenance, to do some flushing, or or even to clear some space. Right? It's getting a bit full. We're gonna have to start deleting some old backups and stuff like this. You compare that to how many times your internet went down, your uptime went, you know, through the roof compared to to that on-prem. So I don't like that whole

concern people have about going to a cloud solution. what about my internet? ⁓ because Starlink saves us all. No. because it's so much better because it's so much better than on prem.

Nirav Shah (25:45)
Yeah.

Yeah, no, the you know, th that's all the benefits of living in the modern era, right? And outdated servers, ma people managing a server, you know, the the insecurity of Wi-Fi going down, right? Getting hacked, you know, with an on premise server, right? somebody by mistakes deletes a backup file, right? Like

Like all that stuff is super super important to consider. Like you you need to find the greatest, you know, the the best security for your data nowadays. You need to find automatic ways to back up your data, right? ⁓ you gotta be able to remove the self management of servers. I feel like that's such an unnecessary v ⁓ task nowadays.

Peter Nicholson (26:33)
Yeah.

Nirav Shah (26:36)
That just adds too much to the bottom line. and you know, we're publishers, ERP publishers of this data take on a lot of that for you and responsibility and they do a pretty darn good job of it. So, you know, if you don't, if you didn't trust the cloud or you've had so many, so many issues with your current data storage setup, right? Your your your solution setup, this is the best way.

you know, of continuing with ERP, because you're not gonna get rid of ERP. You're already on it, you already use an ERP system. You know you need to use an ERP system for the success of your business, but you know you have to change what you have from now. And you know, with the new solutions out there, they're mainly all cloud based. So you'll be hard pressed to find any publisher that's gonna sell you ERP ⁓ on premise, right? ⁓ without having to sign like a ton of warranty liability.

type of documentation, right, from them. So, you know, that that then itself is a huge advantage. and that'll reduce cost, right? Outside of just, you know, better, you know, more updated business processes, less customizations, which we have still talk about, you know, data migration is going to be easier. you know, API integrations are a lot more available, right?

The cost of just maintaining a server on premise even goes down, right? Cost of people maintaining the server goes down. So that's that's I think another huge benefit.

Peter Nicholson (27:53)
Yep. And I'd say a server is an aging thing. It it's at some point gonna be a cyber vulnerability. It's gonna be out of date. It's it can't can't be patched anymore, and it's gonna have to be replaced. Or it's gonna fill up of space and you're gonna run out of space. Now you've still got another problem. ⁓ I would much rather have someone else have to deal with that, like AWS. I probably trust their cybersecurity teams more than my part-time

Nirav Shah (28:08)
Yeah, right.

Right.

Peter Nicholson (28:19)
⁓ MSP. ⁓ you know, and and also you could say, well, it's it's more expensive and at least we paid for our on-prem one. Well think of all of the other costs, the electricity involved, the upkeep of a of a server room, ⁓ the hardware involved. Just have that as a SaaS product. And also I would say that even if say your your a modern ERP seems on paper more expensive, go into the cloud.

Nirav Shah (28:21)
Right.

Right. Right.

Mm-hmm.

Peter Nicholson (28:46)
⁓ I can bet your bottom dollar that support costs will go through the floor. You you know, you might might be more expensive, but if you're doing s you know, an annual hundred grand a year in support, then that suddenly reduced to say a thousand dollars a month in yeah, ten hours a month of just a little bit of maintenance and ask answering a few questions that your your partner's gonna be doing for you, it's gonna be significantly cheaper in support costs that easily

Nirav Shah (29:07)
Mm-hmm.

Peter Nicholson (29:13)
⁓ outweigh the the costs of staying on prem. And we've even seen that, you know, there's certain industries that can't that say quotes can't go on the cloud because of certain reasons, government or some kind of ⁓ aerospace reason, you know, aer aerospace compliance. But we're starting to see some of these big people, GCP, AWS, start to do like government clouds, right? That that give them the necessary certifications to be able to offer

⁓ cloud services to to super sensitive industries. So I don't see any reason why you'd ever stay on prem.

Nirav Shah (29:48)
Yeah, yeah.

Peter Nicholson (29:49)
probably

been a little bit ignorant there, but I would say for the vast majority of listeners,

Nirav Shah (29:54)
Yeah, and like the SMB market, right? that d maybe you don't have you don't have any government compliance, you don't have you know, any other regulatory issues that require you to go on prem, that type of stuff. You know, I think I think then, you know, cloud is the right right approach.

Peter Nicholson (30:07)
Yep. final one here and then we're gonna rattle through a couple of the the items in minefields to watch out for. but this one is interesting because it kind of links back to what you were saying about the people is you kinda know what you wanna buy the second time round, right? The the first time you go through this, it's kinda done blind. You end up with demos that kind of

show off and showcase and wow what an ERP can do and you're learning about an ERP. this second time through though you kinda know which vertical you're after or or you fit in. So you've already got a short list that might work for you. ⁓ and you kinda know what to expect when you're talking to ERP partners and and ERP publishers as well. So it's a l I think it's a little bit easier once you've got that experience.

knowing ⁓ that you're not going in for that first it's like buying your first car, right? You go in super green, you don't know what to do, you're just gonna believe anything that's said to you. The time you're buying your second car, you know what their game is and you know you know how to behave during

Nirav Shah (31:12)
Yeah. Yeah, i absolutely. This is goes without saying, right? You know some of the some of issues you had with your first ERP wasn't built for manufacturing, for example. Maybe it wasn't built for you know, some sort of, you know, t type of compliance process that you do, right? Didn't have quality management. You know what you what you need, right? You know what you want. So the second time around you focus more on that and try to find the right solution.

That's gonna fit the business and overall growth and give you a lot more out of the box. You're not doing customizations, right? maybe you heavily customize your old system and and realize, hey, that's not the approach. And I think in general, the the the new approach nowadays with any ERP system going in the cloud is less customizations the better. Because every customization that you do requires you to upgrade that customization at every release.

So, you know, it it goes without saying do your homework, find the right solution early. And, you know, that's gonna make your implementation much easier. But you will already know that because you're coming off of another ERP system and know some of the headaches that you're dealing with. So that one is like I think an easy one to to do. Go around to to trade shows, go around to you know, ask other people in your industry, right? ⁓ Google searches obviously, you know, AI searches for sure.

You know, have a specific checklist. Like know exactly what your checklist is when you go and buy, look at your next ERP system. It's gonna you're more educated now and you know what you want. right. Like for example, you know, I had a car without or have a car right now without Apple CarPlay. I know for sure my next car is gonna have Apple CarPlay. There is no ifs, ands or buts around that. So, that's like a non negotiable. So have that list. Have your non negotiable list. Like you need to have this in order for you to, you know,

⁓ have a good ⁓ next system and and everyone's on board with everything. So

Peter Nicholson (32:58)
Let's move on. Act two. ⁓ this is gonna be a shorter act, but there's some key points in here because there's stunt some things that will still bite you. and it's easy to squander the advantage that you've got when you're moving through your first to your second. So I'm actually gonna start with our second point here, which is what you mentioned about customizations. So when you're moving from your first one, you've probably got kind of 10 to 15 years worth of tweaks here, tweaks there, bespoke reports.

little bits of workarounds that needed light customization and second time round you know that someone's gonna demand all of them all of them rebuilt like for like straight into the new system for me it's just as cutthroat as that first time every single customization has to re-justify itself of why it needs to exist from zero so look at the new system standard processes they should always

take priority and really question every single bit of custom code and bespoke reporting whether you actually still need it because you are probably coming from an ERP that needed a lot of customization, like we said about integrating to other systems. There's so much now that is now a configured item or even a checkbox on the preferences page rather than customization in code.

Nirav Shah (34:17)
Yeah, exactly. And your previous publisher has probably built in a lot of new features where there were originally customizations for you, right? And they've taken all that knowledge, created more out-of-the-box functionality. So you get advantage that. So you don't have to bring along those customizations to your next new system. So like, you know, Acumatica and Business Central, for example, like they are constantly adding new fe functionality. Like,

To a point, Peter, where it's like, holy cow, can we keep up with, you know, all this new functionality and and then you're ripping out older customizations that we've done, right? So it's just good. It's all good because you're spending a monthly subscription and you're getting the value at the end of the day. so you know, I'd I'd say that th take advantage of it.

Peter Nicholson (34:57)
And I would say some of that

some of that functionality is stuff that's unseen now. You know, people go, Well, where's the print button? where's the the button to post that, you know, or to r to release that document or whatever it is. Like that's done in the background. If that's been confirmed by the warehouse, then we can set it so it's automatically creates, you know, ⁓ what what happens if they scan it in? Well it creates a purchase receipt. I'm gonna do it

Nirav Shah (35:21)
Right, exactly.

Peter Nicholson (35:23)
Do it ⁓ as a manual as a as a separate process anymore. It happens in the background. Where's the create purchase receipt button? It doesn't exist. That's not that's not functionality being taken away. That's it being automated in the background.

Nirav Shah (35:28)
Yeah. Right. Does it exist.

Yeah, exactly.

Peter Nicholson (35:36)
⁓

okay, next one. I think this is one of the bigger ones, and that's around complacency. So if you have got teams that ⁓ were there for the first one, it's easy to go, we've done this before. Like it's easy. It was it was easy. We remember the easy bits, we don't remember the hard bits. What do you mean? We don't need a massive team. Well, a whole nother core team, but we know what it entails. We can easily do this with half the team. ⁓ no, it is

Nirav Shah (35:58)
All right.

Yeah.

Peter Nicholson (36:03)
So it is easier and we've always said through this episode that the second one is easier. We didn't say it was easy. It's still a full business change. It's change managements, people managements, all of that stuff still. It's just easier the second

Nirav Shah (36:10)
Yeah, exactly.

Yeah, exactly. It's easier second time around, but you still have to measure twice, cut once. you know, don't expect that it's gonna be a walk in a park, like, hey, we select a new system, we're gonna we're gonna go bada bing, bada boom, and next thing you know, we're live. No, it's gonna take effort. It's gonna take work. It's you know, you you still wanna question your business processes. You still wanna question, your data. You still wanna question

who's doing what, right? But maybe not to the extent you did in your first ERP implementation, but just so you s you rinse out and you squeeze out every ounce of additional value that the new ERP system is going to give you when you get it implemented. So yeah, don't be complacent. have the same kind of thought process as like if it's your first ERP system, but you are a lot more knowledgeable now, moving into moving into it for your second.

Peter Nicholson (37:05)
Yep.

My next one is around confidence. it was the first one has been done, it's been obviously been successful because you've been on it for the last ten, fifteen years. This second system syndrome that you might have parked first time can easily come back when you have more confidence. So it's easy to go, well, you know, it's successful, we aced it, we definitely know what we're doing second time around. So while we're at while we're at it, we'll also add this into phase one.

We'll add barcoding into phase one. w we'll also do the CRM migration at the same time. ⁓ there's AI now, so we'll put that into phase one as well. Don't you have to treat this as isolated phase one, core business processes. Phase two, the automation and the nice to haves. Don't be overconfident thinking that because the first time was easy, you can just do more the second time round. Don't

Nirav Shah (37:31)
Mm-hmm.

Peter Nicholson (37:55)
Don't chew too much.

Nirav Shah (37:55)
Yep.

Yeah. Yeah. I y hit the nail right on the head. I don't think I have anything more to say about that one.

Peter Nicholson (38:02)
Great.

I know I've aced it with it. All right, last one on this minefield is data hoarding. We said at the start that this your first ERP is removing the big spike with all of the receipts on it and the the cabinet full of printed sheets and all of the Excel sheets. This is now the one of the biggest risks and it's data hoarding. You've moved the business into data.

Nirav Shah (38:04)
You aced it.

Peter Nicholson (38:26)
Now you're moving data to data. It's easy to go, we'll just bring the lot. Don't do that. You don't need all of the history. You just simply don't. Over fifteen years you're gonna have a bunch of customers you've exited, a bunch of vendors you no longer deal with. You're gonna have fifteen years of ⁓ you know AR invoicing and AP invoice. You don't need any of that stuff. So again, this is your opportunity to have a clean start. So bring

What makes sense to you, right? That might be two years worth of active customers and vendors or three years or five years, not fifteen years. ⁓ and and it's the same for invoices, like just bring over open invoices or even just the open balance, reference to the invoices if you want to. trial balances, anything that's kind of open. You don't need the whole lot because you have a wealth of information in your original ERP, which is absolutely fine.

Nirav Shah (39:02)
Yeah, exactly.

Peter Nicholson (39:21)
That can now belong in a read-only data warehouse. So if you have teams of people that need to look up customer history and you know, when was the last time we sold this part? you know, maybe it's a part that didn't make migration. You've not sold it for three years. It didn't warrant, you know, it didn't earn its keep. but you've now got a customer asking for this product code. Well, instead of going, it's a new part and we'll set it up, you can have a look in your read-only data warehouse and go, ⁓

Nirav Shah (39:34)
Right.

Right.

Peter Nicholson (39:46)
⁓ we last sold this twelve years ago and then you can start thinking about should we allow this back into our business? If it didn't make the cut from ERP one to ERP two, do we actually want this business back? There's this kind of stuff that allows you to continue to make improvements to your business and not let all of the old crap creep back in. You cannot do that if you just bring in everything over again.

Nirav Shah (40:10)
Mm-hmm. Yeah, it exactly. You need to really take some time and understand like the value of history. Like, what are you getting out of it at the end of the day? How like it's a pure measurable decision that you're able to that you need to make on the history in the future. Okay, that's the other part of this. If you've already made decisions on that history,

And you just have it just to have it, because you need to, you feel you could sleep at night, that out question whether you need to bring it in. Right. But if it's critical, business critical for you to make decisions in in the future that you haven't made for that history, I think there's a conversation. I'm not saying that's even a hundred percent that you need to bring that information in, but you know, you have to be careful. It's just like garbage in, garbage out. Cause once you start bringing in the old history in, you're kind of stuck with the data migration.

You really can't move that data migration along because you're because you're stuck with the way that data was created the first time, you gotta create the same way the second time. So, you know, be careful with that because that could that could also be a double edged sword here, where yeah, it sounds good on the surface, but it could really be a detriment and get you back to square one where you originally were.

Peter Nicholson (41:18)
Yep. and finally, Act three. I'm gonna lean on you a little bit more on this one, Nirav, because you'll be talking to these kind of people that are considering that and they're starting those conversations with partners. if there's someone out there listening to this, what should they do in the next two or three months if they're sitting there going, you know what? You're right, my my ten year old ERP does suck.

Nirav Shah (41:40)
Yeah. Yeah.

Peter Nicholson (41:40)
What should

where should they start with this?

Nirav Shah (41:41)
Yeah, I think I think start getting internal feedback just with people. Start with an internal committee. You know, this is an initiative that you're thinking about, it's not a hundred percent done yet, right? Or you're gonna make the choice. But have have a have a town hall with your with your people, right? Have a have a call discussion on i is this realistically the right system for us right now as you're moving into growth phase.

As you're taking on new customers, you're taking on new product lines, you've expanded to different markets, you're you're moving into different different states. Is this the right system? Is this system now hurting the business more than helping the business? Right? It's a town hall conversation. Everyone should be involved in it, not just management, not just key users. Just an open, honest, collaborative dialogue, right? Have that first. And then take all that, document all those issues.

Those symptoms, right? and that's not like a shopping list, you're gonna turn back around and say, okay, these are all this is these are the specific system I need because these are all issues that we faced. But think about what specifically is like hurting. Who is it hurting? What does it cost that person at the end of the day? Right. So some could be fixed just by configuration of your current system. That's always on the table, right? And we can't discount it. You've already made that investment. You spent that money, you're on your current system. But

Are the symptoms strong enough to take that one step farther and now actually do some studies in the business? Which modules, which customizations, which integrations are really hurting us? Where are we losing time every day? Where are we losing employee morale every single day? Where are we losing business? Our customers are going to.

you know, ⁓ our competitor because we're just not fast enough. Or invoices are just constantly wrong. Or, you know, our bank can't give us a loan because they have to come audit us every six months 'cause we can't release proper financials.

Right. What are the specific now issues that you need to go and rip apart? Study? Okay. Do that audit. Do that data run. Right? Now have interviews, one-on-one interviews with people. After your time studies, after your investigations, interviews, right? And now say,

You know, come to the conclusion this specific module is broken. This specific process is broken. Right. The system is down too often. Right. We have to spend an extra hour a day because we have to just put in all the stuff that we wrote down on pen and paper because the system was down for maintenance or something like that at the end of the day, which is zero value add, right? And you miss a lot of real time reporting.

Peter Nicholson (44:17)
Yep. I'd also say more of a high level strategic point of view is you're probably doing long range plan that should include an ERP migration if you're on some of the ERPs that we mentioned at the start that are coming up to end of life or at least end of support. So if you are out there and you're on GP, it is it it that is it. Twenty twenty nine, you need to be doing things. That's in three years' time.

So if your company does long range plan of three to five years, it needs to be in there as a line item. We're gonna have this cost, we expect it as to cost us say three hundred thousand dollars, we need to park that, we're ready for an investment of our ERP. If you're on any version of a classic nav, anything before Dynamics Business Central, you also should be considering this into your long range plan.

as well. So ⁓ I think it's it's paramount that you do the granular work, the audit. Let's have a look at what you've got, inventory, what you've got in your current system in terms of customizations or anything bespoke to you. Do this stuff, but also look at the the long range long range horizon of okay, well we need to do something at some point. We know that.

Does that mean that we'll need to be doing that in the next five years? 'Cause it's easy to go, Yeah, twenty twenty nine. Even now I feel old, right? Twenty twenty nine sounds like a futuristic year. It's three years' time. Like, my god.

Nirav Shah (45:36)
Yeah. Yeah,

yeah, yeah, yeah, exactly.

Exactly.

Peter Nicholson (45:40)
Okay, very good. I think that's it. ⁓ if you've been listening, if if your ERP does genuinely suck, ⁓ then then hopefully you start to realize that ⁓ the thing keeping you on it isn't the the battle scars of the first one. Round two is a different project. It is easier. ⁓ a lot of your business processes just survive, it's just moving from one system to another. Integrations are easier, they're more often than not now just a configuration.

Nirav Shah (45:48)
Yeah.

Peter Nicholson (46:07)
Or have just completely gone away with new functionality. so I think that second one is really where you start to leverage what you've learned from your first one. So if you have found this episode enjoyable, insightful, make sure you like and subscribe. Smash the smash the subscribe button. and if you are s staring down at one of these moves that you need to do something.

About some point, well, always reach out to to Nirav, Nirav's team AdCirrusERP. They do these migrations for a living. AdCirrusERP.com He still hasn't paid me to say that and I I still say it. I don't know why. ⁓ but if you want someone that will moan at you and tell you why you don't need 20 years of GL history in your shiny new system, hello. That's my that's my corner. Come and

Nirav Shah (46:53)
Mm.

Yes, yes.

Peter Nicholson (46:57)
Come and argue

at with me about that at peaknicolson.co.uk. I blog about all of this stuff on there and I also moan about it on LinkedIn. but jokes aside, if you have got something out of this, make sure you follow the show. Where if you're listening or watching Spotify, Apple, YouTube, you name it, leave us a review if it was helpful and pass it on to a friend. we do this completely for free. No adverts, no sponsorship. We've we've heard, hang on, I'm getting yes.

Nirav Shah (47:23)
Ha

Peter Nicholson (47:23)
Yes, Elon

Musk has phoned in. We are getting a billion dollars. ⁓ so still no sponsorship, I'm afraid, from ⁓ Starlink. But we do just do it for the love of it, as much as you can love an ERP. so with that, thanks for living. thanks for listening. Nirav, ⁓ catch you in two weeks. and Emily, Emily, if you're listening to this, your seat's getting cold. Hurry back.

Nirav Shah (47:27)
Ha ha.

Yes, yes, yes, yeah, yeah, yeah.

Absolutely. Yes. Yes.

Yes. We need you back. We need you back. ASAP. And by the way, he is the data king. I don't know. Like like this this this this this guy literally is. So

Peter Nicholson (47:55)
I am.

I am. I've got a badge and everything.

Nirav Shah (48:00)
Yeah, yeah, he does. Yeah, he does. And I think you have a candle too.

Peter Nicholson (48:04)
I do, I do have

a d I have an Acumatica candle, it says Data King. You know what? I plugged my phone in, I got in the car and you know it it synced up some the car synced up and I changed my iPhone and now is named the Data King. And ⁓ course it came up on a banner that said the Data King is connected. And I looked at Heather and she just looked at me like, Really? Yeah.

Nirav Shah (48:14)
Yeah.

my gosh.

R I I think Netflix is gonna be come knocking on your door real quick, really soon and saying, Hey, we need to interview the the the data c the data king here. So, yeah.

Peter Nicholson (48:28)
Ha ha ha.

The day the king. Yeah, yeah, yeah. Yeah.

Yeah. As long as it doesn't end up with like a suspicious murder and I'm suddenly in prison for it.

Nirav Shah (48:38)
Ha ha ha ha. ⁓

Yeah, we saw him in the server room and then next thing the hard drives were missing and he was on the ground.

Peter Nicholson (48:42)
Ha ha

Ha ha ha.

Nirav Shah (48:47)
And yet AI spray painted all over him.

Peter Nicholson (48:47)
They don't call me the

Yeah. Yeah, exactly. They don't they don't call me the Data King for nothing, you know.

Nirav Shah (48:56)
that's right, that's right. Exactly.

Peter Nicholson (48:58)
Right, very good. ⁓ and I will catch you, yeah, two weeks' time.

Nirav Shah (49:02)
You got it. Have a good one.

Peter Nicholson (49:03)
Okay. Bye.