In an era of rapid digital innovation, many organisations are facing a critical technology crossroads: whether to upgrade their existing legacy ERP to a cloud-based version of the same platform or to seize the opportunity for a more transformative change.

Too often, the path of least resistance wins. But doing so can be a missed opportunity to modernise not just systems, but also business processes, agility, and competitiveness.

Gartner predicts that “by 2027, more than 50% of enterprise IT spending in key market segments will shift to the cloud” – a trend that clearly signals the shift towards transformation over migration.

Yet many organisations still opt for a like-for-like ERP upgrade, replicating outdated processes in a modern infrastructure without addressing core inefficiencies or scalability issues.

The Illusion of Simplicity

On the surface, upgrading to the cloud version of an existing ERP might appear to be the simplest route. It promises familiarity, fewer changes for users, and potentially lower perceived risk.

However, this approach often leads to what Deloitte describes as “technical debt accumulation”, where outdated business models and rigid workflows are carried forward into a more modern but underutilised environment.

According to PwC, 67% of organisations that implement ERP in the cloud without a full process redesign report fail to achieve their expected ROI. This statistic highlights the need to approach cloud adoption as a transformational initiative rather than a technical upgrade.

A Modern ERP Is About More Than Technology

A modern ERP strategy should align with future business needs, not past constraints. That’s where a replace programme comes in. Rather than simply replicating the status quo, it evaluates whether the current system is fit for purpose, explores opportunities for innovation, and identifies the right ERP platform to drive long-term growth.

McKinsey notes that companies undergoing digital ERP transformations can expect to see improvements such as a 20–30% reduction in operational costs and 10–15% increases in efficiency across functions.

These gains stem from process simplification, data unification, and intelligent automation, outcomes that are unlikely with a simple version upgrade.

Making the Right ERP Decision

A successful ERP journey starts with an honest assessment of the current environment.

Key questions to ask include:

Is your current ERP aligned to your long-term strategy?

Are your business processes standardised or overly customised?

Do you have real-time access to the data and insights you need?

Are you prepared to adopt best practices in finance, supply chain, and operations?

At Hitachi Solutions, we help clients answer these questions with data-driven clarity.

Through our replace programme, we provide:

Fit-gap analysis: to assess the strengths and limitations of the current ERP system.

Solution architecture reviews: to highlight opportunities to improve scalability, performance, and resilience.

Business process benchmarking: to identify where industry best practices can reduce cost and risk.

Roadmap and recommendation reports: to guide confident decision-making aligned with both IT and business strategy.

Real Transformation. Real Results.

The decision to replace rather than upgrade should not be taken lightly. But in many cases, it is the path that offers the greatest long-term value. As EY puts it, “ERP modernisation should be viewed as a business transformation—not just a technology project.”

Hitachi Solutions works in partnership with clients to ensure ERP decisions are strategic, not reactive. By taking a consultative approach focused on outcomes, we help organisations choose and implement solutions that drive profitability, agility, and competitive advantage.