How IT Can Simplify and Accelerate ERP Cloud Migration

A major shift is underway in the world of enterprise resource planning (ERP) software. With both customers and ERP software vendors driving a mass migration to the cloud, many companies have already completed their ERP cloud migration projects—and thousands more are set to follow suit by the end of this decade.

But ERP cloud migration is a costly and time-consuming undertaking, particularly where IT is concerned. For companies seeking to digitize their enterprise applications, it’s clear that corporate IT will be heavily taxed for the foreseeable future. Meanwhile, cloud ERP software vendors and system integrators are poised to reap the benefits of years of migration project work.

The Challenges of Bank Integration

For corporations,  ERP cloud migration projects are often global in nature — and many will need to tackle the complexity of a global banking integration project.

This element of ERP migration is particularly challenging, significant coordination is needed with the company’s banks, and there is a considerable disparity between the payment formats required by different geographic regions and clearing systems. Indeed, bank integration is often cited as one of the riskiest and most challenging elements of ERP cloud migration.

Simplify and Accelerate

The good news is that companies can considerably simplify and accelerate a major component of cloud ERP migrations: bank integration for reporting and payments. Connectivity-as-a-service (CaaS) providers deliver pre-delivered, pre-tested capabilities for bank reporting and payments formats that shave months off the migration project, and reduce connectivity and format costs by up to 80 percent.

Bank and ERP Cloud Integration: What’s Involved?

Bank integration is unlike any other system integration. Today’s corporate IT teams are experienced in building interfaces between different back-office systems—but these are typically stagnated interfaces that do not require additional resources.

In contrast, when working on a bank interface, the IT team will typically need many different resources to coordinate with each other, including IT, treasury, accounts payable (AP), the connectivity team, the bank’s tech team, and others. What’s more, the project timeline is usually at the mercy of the bank’s schedule.

Bank ERP integration can similarly be time-consuming. IT first has to determine if the cloud solution is compatible with their ERP. Then, the data needs to be extracted out of the ERP and re-formated. IT departments are often stymied and reliant upon outside consultants to deliver integrations or core capabilities within the ERP.

Furthermore, once the initial specifications for these connections are determined, they need to be tested – and they rarely pass on the first try. As a result, the development team will need to rebuild, re-test and work through the coordination effort all over again. In some cases, two to five rounds of testing may be needed.

What are the Challenges in ERP Cloud Migration?

For IT, the bank integration component of an ERP cloud migration brings a number of additional challenges.

Working on the Banks’ Timelines

Delays in the ERP migration project often arise due to delays by the company’s banks. If the company has a robust relationship with a core banking partner, it may be able to move up the project queue for that particular bank. But with many corporations needing to manage dozens of banks globally, the IT team will be forced to follow those banks’ schedules—which means working across different time zones and navigating banking holidays and seasonal moratoriums on testing.

Navigating Geographical Variations

No two banks are the same, and it’s a common misconception that SWIFT is a standard message type across banks. While SWIFT is moving from MT to XML, each bank will still have its own unique requirement in terms of how it will accept incoming files.

For any payment type, companies will need to ensure that payments are formatted correctly for a specific bank’s requirements and that they contain the information the bank needs to complete the payment. Most corporations will need multiple formats per bank, which might include different formats for low value, high value and FX transactions.

Given the complexities, it’s no surprise that IT firms routinely take two years or more to work through all these bank connections and payment format testing.

Payments Integration and Fraud Prevention

Payments integration is a challenge, given the ever-increasing threat of fraud. Even with effective tools like artificial intelligence (AI) and machine learning, the threat level is the highest it’s been yet, according to Strategic Treasurer’s 2021 Treasury Fraud & Controls Survey.

In addition to financial loss, fraud events damage a company’s reputation and lead to the loss of essential data or assets. It is therefore essential to use ERP integration as a way to put technology in place to protect your organization. This should include digitizing payment workflows, standardizing controls and screening payments as part of an integrated payments hub.

Complexities for IT

Adding to these challenges, bank integration brings a number of complexities where IT is concerned.

Limited IT bandwidth

Corporate IT teams are already thinly spread across numerous projects and support requirements. As such, the time involved in undertaking a bank integration project can be particularly onerous.

No Reusable Data

When IT teams work on an ERP implementation, they have to develop their banking interfaces as a one-off exercise. While ERPs may be moving to the cloud, ERP solutions are still typically private cloud providers—and no ERP in the market has readily available, reusable banking formats that can be shared among users.

Multiple Stagings

Bank and payment format development is no different than for any other interface or application, as IT has to work through the same rigorous processes. If the business users need a new payment format, such as a new ACH for an existing bank, they will still need to go through the process of testing, QA, nonproduction and production. This process can take months, meaning there will be a considerable delay before the end user has access to the payment format.

Resource Requirements

Once formats are in production, the IT infrastructure team will need to manage those formats going forward. This involves activities such as troubleshooting bank issues, editing formats as required by the bank and working with the business to add new banks when the need arises. Depending on the company’s banking footprint, two to five people will likely need to be tasked with managing these connections on an ongoing basis.

Integration Made Easy

Standard ERP integration is a lengthy process that is incredibly taxing on IT. But there is an easier way. Leading technology providers should offer a pre-built, pre-tested connectivity solution that takes minimal time to get up and running and provides access to even greater functionality immediately.

Leading ERP and Bank Connectivity

Technology Considerations

ERP integration brings many challenges to IT – but these can be overcome by adopting a technology solution that simplifies both bank and ERP connectivity.

With 20 years experience in connectivity, Kyriba can integrate bank reporting and payments, while mitigating risk–all in record time thanks to our use of application programming interfaces (APIs).

• Accelerate your ERP Migration Project and Reduce Costs
  Our out-of-the-box, bolt-on bank connectivity can help you achieve exceptional time and cost savings on bank integration. While standard integrations might required months of testing, our connections are pre-tested and ready to go.
• Access a Payment Format Library
  As a multi-tenant application, Kyriba is unique in the marketplace as our entire 2,500-strong customer base uses the same predeveloped and tested payment formats. What’s more, we have full-time staff whose sole responsibility is to build and test payment formats. As a result of 20 years of development, we offer more than 45,000 pre-developed and bank-tested unique payment scenarios.
• Simplify Interfaces
  Minimal IT resources are needed when it comes to interfacing between the ERP software and Kyriba. Using both SFTP and API, we take all payment files into our prebuilt interfaces with no code specs needed from IT.
• Focus on the Wider Project
  Kyriba’s connectivity platform frees IT up from the daunting task of bank integration—so you can focus on keeping the ERP project on schedule and on budget.
• Avoid the Need for Swift Connectivity and Certifications
  When you use Kyriba for connectivity, IT won’t need to manage the Alliance Lite2 SWIFT connection— and there will be no need for annual testing and certifications.
• Manage Ongoing Maintenance and Support
  When the project is over, Kyriba will handle all ongoing maintenance and will act as the banking IT support arm for business users, meaning you won’t need dedicated IT resources to troubleshoot bank issues.
• Connectivity as a Service
  By offering Connectivity as a Service (CaaS), Kyriba can actively manage bank connections on your behalf. As a result, no IT support will be needed to manage your company’s bank connections or undertake file testing with banks—and with Kyriba’s API capabilities, companies can also add new banks in a fraction of the time that would be needed for custom development within the ERP.
• Market-Leading Payment Fraud Protection
  With IT increasingly tasked with risk mitigation, Kyriba’s market-leading payment fraud solution adds considerable value. The solution uses machine learning to detect any anomalies or suspicious activity, and provides alerts to stop payments for investigation before they are sent to the bank.
• Payment Tracking
  Kyriba offers real-time payment tracking with four levels of acknowledgement. By harnessing SWIFT gpi, Kyriba is able to track the entire lifecycle of the transaction.
• Innovation and Agility Hub
  Payment technology is evolving rapidly. Kyriba’s innovation and agility hub can deliver Real Time Payments (RTP) and can connect with other clearing systems and payment solutions.
• Smart Assignment
  Kyriba’s machine learning will have visibility to your banking partners and costs associated with each payment. Smart assignment can intelligently route your payments through the lowest cost provider.
• Bank Monitoring
  Kyriba offers global bank monitoring of all incoming and outgoing files. Kyriba clients can rest assured that they have fully outsourced banking support.
• Established Partnerships
  As an Oracle GOLD partner, Kyriba’s Payments Network supports over 1,000 Oracle customers. Our payments solutions have also achieved SAP-certified integration with the SAP NetWeaver® technology platform and SAP S/4HANA.

APIs and Connectivity

The future of connectivity lies in Application Programming Interface (API) technology. This is where Kyriba has a key advantage. As the leader in connectivity in treasury and finance, Kyriba understands how to maximize the power of APIs to help finance leaders drive digital transformation and more informed decision-making.

Bank APIs

APIs offer an expedited pathway for bank connectivity, as well as a gateway to real-time business intelligence and digital solutions. Unlike file transfer protocol (FTP), APIs do not require files to be sent or downloaded. Data is exchanged point to point between the systems immediately, allowing for instant data transmission and eliminating substantial risk.

Kyriba connects with over 600 global banks every day on behalf of our 2,500 clients using a variety of connection protocols, including APIs. Banking services available via API vary by bank, but can include real-time payments, domestic payments, cross-border payments, bank balance and transaction reporting, and SWIFT gpi payment tracking. Users receive immediate responses from banks, and the ability to access new data and notifications in real-time.

ERP APIs

Kyriba also works with ERP system providers to embed other systems via API integration into their workflows so that the user doesn’t need to take any action outside their ERP. These add-ons perform the initial formatting so that files can be exported from the ERP, translated to the API provider’s format and pushed out to the connectors. Corporate end-users can also integrate APIs into their ERPs on their own. These plug-and-play solutions are facilitated through our Open API platform, which provides users with common ERP integrations that connect to their own applications.

Kyriba users can browse our online catalog, which lists all our available APIs and their prospective use cases. Here are a few examples:

• Bank Account Groups: This API allows for the creation of new account groups to filter and/or group accounts in processing and reporting. Users can modify the set of accounts that belongs to a specific group, and retrieve or update the pooling account of the group.
• Companies: This API allows for the setup of companies. Users can get a list of the companies located in a country, receive a list of companies whose name contains specific characters, and obtain all the setup fields of a specific company.
• Third Parties: With this API, users can manage and set up third parties who represent the companies they manage. Users can retrieve and update third-party details, and create or delete third parties via API.

Optimized Bank Connectivity

Conclusion

There are many challenges for IT when deploying an ERP project, from working around banks’ schedules and specifications, to navigating the complexities of geographical variations – all while juggling an already heavy workload. Fortunately, Kyriba’s in-house developed, complete CaaS solution encompasses all ERP software vendors, internal financial systems, third party providers, and over 600+ pre-configured, pre-tested connections with banks across the globe – allowing for fast and simplified ERP migration. Payment and connectivity costs can be reduced dramatically, while the time spent on bank integration can be streamlined by as much as 80%. What’s more, freeing up the IT team from having to work within the constraints of the banks will help you keep the wider ERP project on time and on budget.