Avoid the ERP customization trap when moving to the cloud – lessons from a Canadian municipality

Posted by  Robin Wishart

A guest post by Robin Wishart, Director of Corporate Support at the City of Port Coquitlam.

Working with the City of Port Coquitlam, Unit4 was the first enterprise software provider to host Canadian municipal data in the cloud. Ensuring legislated local data residency requirements are met is vital.

The City made its move to the cloud early, in 2015. The City of Port Coquitlam is a rapidly growing urban municipality of over 57,000 residents, located in the northeast section of Greater Vancouver. The City is distinguished by a strong sense of community pride and a commitment to building an organization where employees feel they belong, willingly work hard and can see the contribution they are making to the community. We have built a reputation over the years for our high level of citizen engagement, and I believe this is a partly due to our innovative use of technology.  The City has been an early adopter of many new technologies, particularly those disruptive ones where both cost savings and enhanced services are achievable.

When it came to our ERP system, we identified the potential for cost savings, increases in full-service and support, and greater access to delivery specialists beyond what they could resource internally, as key cloud advantages. Canadian data privacy regulations are very strict. Jurisdictions in British Columbia are legislatively required to keep all personal information in a Canadian data center, including employee and payroll data, as well as citizen and taxpayer information.

Three years on, the City of Port Coquitlam’s ERP implementation has been very successful. The cloud component is certainly part of our success. It has allowed us to move to a Software-as-a-Service (SaaS) model where Unit4 runs the system and maintains all the technical operations and most importantly, conducts the upgrades.  This has saved the City from hiring (and retaining) technical people with experience in our ERP. Our technical team only needs to know the basics of the system and how it exchanges data with our other software solutions (some of which are also cloud based solutions with different vendors).

No customization is key to success

One key success factor is no customization of the ERP. Customization traps you in the pain cycle where you just go in a huge circle of regression testing, fixing issues, finding incompatible underlying software structures and repeating the entire process. As a result, organizations might spend years staying on major software versions and then having to spend huge amounts to upgrade their systems.

If you need to customize, then you should either change your business practices to align with the standard ERP -- the preferred approach -- or host the customization components outside the ERP. For SaaS cloud offerings to work effectively, they need to be standardized. This does not mean you have to have cookie-cutter versions of the software, but that you need to work with the level of configuration the software provides. This really shows its value when you are doing upgrades to the product, particularly the larger major version or milestone versions. The cost of ensuring all components work together in a consistent and error free manner are largely bore by the SaaS provider (who also has the best understanding of their own software). The City still does its acceptance testing and runs through basic business activities, but any problems are handed off to the cloud provider for correction. This process is far less work and cost to the City.

As ERP products transition from “big bang” upgrades to smaller organic upgrades I expect the savings to be even larger as small organic changes are much less disruptive, easier to test, and often require minimal to no training.

Customization kills your budget in any ERP system and should be avoided.

Don’t get boxed in

It is very important to have a data repatriation plan with any cloud solution. By repatriation I mean the ability to get your data back and then either move it to another cloud provider or even on premise. This level of portability is vital. I am a big proponent of cloud solutions, but it is critical that there are options available without getting boxed in with just one solution.

In Summary

If I had to offer advice to other IT leaders on getting good results in implementing cloud ERP systems and applications, I would say first and foremost, don’t customize. Then keep versions current. Continue to test your Disaster Recovery and failover plans regularly and do periodic data repatriation exercises (get a copy of your data onto your own system).

Robin Wishart

Director of Corporate Support, City of Port Coquitlam