Use a fit-gap analysis to pick a cloud ERP system

ARTICLE | August 31, 2023

Authored by RSM US LLP

The cloud is the biggest technology enabler for middle market organizations. It creates scalable solutions with better security and helps organizations become more efficient and competitive.

Additionally, the benefits of the cloud are expanding as advanced capabilities—such as data analytics, robotic process automation, artificial intelligence and multichannel customer experience management—become common components of a successful business model.

More organizations are migrating their core business system from on-premises versions to cloud application platforms. Once organizations have committed to implementing cloud enterprise resource planning (ERP), the next big task is to find the right solution. A fit-gap analysis can help plan the scope, approach, resources and timing for the delivery of the solution.

Why conduct a fit-gap analysis for cloud ERP?

A fit-gap analysis compares an organization’s operating or business requirements to its system’s capabilities. The analysis determines potential benefits and issues in functionality. The process also helps define the high-level implementation road map and change management considerations; it also identifies stakeholders who will ultimately drive strategic and tactical decisions. A thoughtful process will vet multiple areas to help ensure a successful result.

How is a fit-gap analysis conducted?

The process begins with discovery workshops, where executives and users from each organizational department identify their business and technical requirements. Important questions about the organizational strategy, deployment plan, technical architecture and expenses help determine the key requirements. These requirements serve as the basis for the fit-gap analysis.

The analysis transforms requirements into a request for information/proposal, which is distributed to appropriate solution providers. Responses to the request for information/proposal provide a quantitative view of what each solution provides to support the requirements. This quantitative view is one component of the selection criteria.

Demonstration are the next step. These show how each solution will support the requirements. Demonstrations also allow the vendor to present capabilities and benefits and to answer questions on functionality gaps.

Implementation planning sessions then help define the road map and implementation plan. Development of this plan is an iterative process. The plan will become a dynamic guide to the implementation.