Mitigate ERP Cloud Migration Risks for Utilities

Anticipate disruption, strengthen controls, and sustain operational integrity.

Analyst Perspective

An ounce of proactivity is worth a pound of reactivity.

While constant innovation and being on the cutting edge of new technology is an admirable goal for any CIO, achieving it within the utilities sector comes with an additional degree of difficulty. The scrutiny, both internal and from regulatory bodies, that comes with providing critical infrastructure to the masses places a considerable premium on risk-averse practices meant to keep the lights on first (often literally) and evolve with the times second.

The adoption of cloud platforms and technologies promises many worthwhile benefits but also introduces new avenues for risk to materialize. This is true particularly for a system as all-encompassing as an ERP.

Accounting for the regulatory obligations, legacy system integration, and performance requirements for the new system requires a proactive approach to risk management for the migration process. Making use of a framework designed to spotlight the key areas of change and identify risk events early on allows you to build resilience into your roadmap from day one. With the right guidance, you can eliminate the need to react to failures as they occur and instead engineer stability into your new system to drive your organization toward its objectives.

Evan Garland
Research Analyst, Industry Practice
Info-Tech Research Group

Executive summary

Info-Tech Insight

When done right, risk prevention accelerates rather than impedes progress.

Understanding risk tolerance and control measures enables confident, fast-paced execution. Proactive risk management eliminates second-guessing by embedding safeguards directly into your migration process.

Your challenge

Technology leaders in the utilities sector struggle to account for the risks a migration introduces.

• Migration is inevitable. Major ERP vendors like Oracle and SAP are strategically shifting support away from on-premises solutions toward cloud offerings, making migration an inevitability for organizations that have yet to adopt cloud solutions.
• Services are too critical to be interrupted. Because of the critical infrastructure managed by utilities organizations, a major change to an important system with many integrations into work processes (like an ERP) must have robust contingencies in place to ensure little to no disruption to critical services.
• Regulations must be learned and accounted for. The utilities sector also operates under strict regulatory frameworks that vary by jurisdiction, many of which have standards for security and usage of cloud platforms that would be novel to an organization that does not make use of cloud technology. These requirements must be understood and accounted for to avoid exposure to penalties.

Common obstacles

System criticality leaves little room for downtime, errors, or performance gaps.

• Existing risk management frameworks are not designed for the task. Properly identifying and assessing risks requires a common risk language across your organization. If cloud technology is new to your organization, your ability to effectively categorize (and therefore identify and assess) risks properly that are cloud or migration specific can be limited.
• Weigh both the "what" and "when" of risks. The introduction of new risks throughout the migration process is neither linear nor lump sum. Some potential issues will need to be addressed earlier to avoid snowballing, and others must be monitored well in advance to ensure escalation options remain available if needed later.
• Legacy and OT systems add complexity. Legacy and operational technology (OT) systems that are critical to core operations are necessities for integration with the new system. This can present significant technical and security challenges to design around while maintaining performance and compliance standards.

51% of IT professionals find privacy and data protection more difficult in a cloud or hybrid environment (SentinelOne, 2025).

US$4.88M

Average cost of a data breach in 2024, the highest value ever and a 10% increase YoY (IBM, 2024).

Info-Tech's approach

Be proactive about identifying, assessing, and managing the risks of the cloud and the migration process.

• Update your taxonomy. Expand upon your existing enterprise risk taxonomy, or use our suggested template purpose-built for ERP migration. This framework enables your IT, security, and business leaders to use a common language for risk identification and create a comprehensive overview of the scenarios that lead to undesirable outcomes.
• Identify risk sources and assess severity. Focus on the drivers of risk within the ERP migration context, including compliance obligations, legacy and OT integration needs, and the evolution of recovery and operational resilience needs. These will lead you to the risk sources that require coverage and planning to protect your data and operations throughout the migration.
• Establish ownership, treatment, and monitoring practices. Reduce risk severity by assigning ownership to domain-knowledgeable personnel and assessing the most effective treatment options. Have an established cadence for reviewing meaningful risk indicators to ensure you are always controlling risk sources as they evolve, not reacting to them.

Info-Tech's approach

Surface and prioritize migration risks to align cloud adoption with business and regulatory needs.

Manage key ERP cloud migration risks

• Compliance gaps
• Business disruptions
• Data security threats
• Legacy infrastructure constraints
• Skill obsolescence
• Rising costs
• Performance degradation

Design for Resilience, Not Rescue

Smart migrations prevent risk by designing for resilience, not reacting to failure.

Info-Tech's Approach

Phase 1: Assess Readiness, Surface Risk

• Evaluate people, process, and technology to uncover vulnerabilities and gauge migration preparedness.

Phase 2: Build the Roadmap, Engineer Resilience

• Design a clear, actionable migration plan with targeted risk mitigation built into every step.

Key Deliverables

• Risk register with key migration risks
• Migration roadmap with risk treatment measures

Info-Tech's methodology to mitigate ERP cloud migration risks for Utilities

Insight summary

When done right, risk prevention accelerates rather than impedes progress.
Understanding risk tolerance and control measures enables confident, fast-paced execution. Proactive risk management eliminates second-guessing by embedding safeguards directly into your migration process.

Identify risk across every layer, not just every step.
Bring together leaders who understand compliance, legacy systems, scaling needs, and frontline operations. Map risks by looking across business, technical, and regulatory domains.

Prioritize risk by what breaks your service, not just what breaks your system.
When service provision is so crucial to your operations, it is important that your calculations for risk severity are weighted properly to account for it.

Use KRIs to catch risk early before it cascades.
Key risk indicators give you early warning signs when risk conditions shift. Tracking them means fewer surprises and faster mitigation.