Posted by George Delp
Explaining how to handle data conversion to anyone implementing a new Enterprise Resource Planning (ERP) software is probably the most difficult concept to explain. Most people want all of their data from their existing system ready to go in there new system on day one. While this is a wonderful idea, the actual act of doing that is easier said than done.
The Problem
The problem with data conversion lies with historical transactions. Converting master records and open balances is easy in comparison. The reason for the difference is that historical transactions, such as paid vendor invoices, involve a lot more than updating just one table. In fact, such a transaction is actually a series of transactions.
In the case of the vendor invoice, there is possibly a preceding purchase order, an inventory receipt, vendor invoice entry and vendor invoice payment. Typically, the only way to recreate this type of history is to rerun the transactions in the new system. This is not a trivial task and winds up taking a lot of time and money. These transactions typically update multiple tables and the only way to ensure data integrity in the new system is to rerun the transactions. Creating an import tool that “gets it right updating every table” is usually not practical.
In the case of the vendor invoice, there is possibly a preceding purchase order, an inventory receipt, vendor invoice entry and vendor invoice payment. Typically, the only way to recreate this type of history is to rerun the transactions in the new system. This is not a trivial task and winds up taking a lot of time and money. These transactions typically update multiple tables and the only way to ensure data integrity in the new system is to rerun the transactions. Creating an import tool that “gets it right updating every table” is usually not practical.
So, What to Do?
There are several options.
But first let’s talk about the basics. Regarding data conversion, everyone should at a minimum:
But first let’s talk about the basics. Regarding data conversion, everyone should at a minimum:
- Convert master records, such as GL accounts, vendors, customers inventory items and whatever else might be appropriate for your situation.
- Convert open balances and true them up right before go live.
This is typically done by exporting the data from your current system into a spreadsheet compatible format and then importing it into the new system. Data cleansing should be performed at this time. This involves deleting no longer used vendors, customers and items, combing duplicates and also possibly redesigning the chart of accounts. If the number of items is low, say less than 100, it is often easier to just hand key the information. This can also serve as a great training exercise.
After that you need to decide how to how handle your historical transaction detail. Options include:
- Just ignore it. Most people don’t go for this.
- Keep you legacy system around for historical look up purposes. Most of the time when we put people onto a new ERP system, the prior system is some kind of perpetual software license so it isn’t going anywhere. This is by far the most common and cost effective approach.
- Export you data into a simple database or complex spreadsheet so you can look things up. If you are switching from a SaaS system sometimes this is the only option since the SaaS system will go away once you stop paying for it. Although, as of late I have seen people keep their old SaaS systems for a period of time by lowering the user count to one or two users.
Start Planning Your New ERP ImplementationChanging ERP systems is a big deal and how you handle your data transfer is critical. You have to balance the cost/benefit of any business project. Hopefully the above listed ideas give you some ideas on how to achieve the right cost to benefit and will help you on your way to planning your new ERP implementation. |  |
Partner with InterDyn ArtisIf you are interested in implementing a new ERP solution, InterDyn Artis can help! With nearly 30 years of proven experience, we have helped hundreds of organizations implement solutions that provide a positive return on investment.
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