ERP & M&A
Cloud-readiness diligence: what acquirers miss
When a private-equity firm or strategic acquirer evaluates a target that runs on a legacy ERP — JD Edwards, an old EnterpriseOne footprint, a heavily customized on-prem system — the technology rarely gets a serious look until after close. Then the migration estimate arrives and the deal model wobbles. A focused cloud-readiness assessment, run before the ink dries, is one of the cheapest forms of insurance in the whole transaction.
Why it gets skipped
Financial and legal diligence have well-worn playbooks. ERP diligence usually doesn't — so it gets reduced to "they're on JD Edwards, we'll move them to the cloud eventually." That sentence hides the three things that actually determine cost and timeline.
The three questions that matter
- How customized is the core? Vanilla ERP migrates on a schedule. Twenty years of bolt-ons, custom tables, and undocumented integrations migrate on a prayer. The volume and nature of customization is the single biggest driver of effort.
- Where does the data actually live — and who trusts it? Master-data quality, shadow spreadsheets, and the number of "sources of truth" tell you how painful the cutover will be long before any tool does.
- What's holding the lights on? Key-person dependencies, end-of-support versions, and integrations nobody fully understands are the risks that turn a 12-month plan into a 24-month one.
You're not trying to scope the migration during diligence. You're trying to find out whether the number in the model is off by 20% or by 200%.
What a good assessment delivers
- A customization and integration inventory, rated by migration risk.
- A data-quality read with the specific landmines called out.
- A realistic effort band — not a single fake-precise figure — with the assumptions exposed.
- A first-90-days view: what would actually have to happen post-close.
It's a two-to-three-week effort that routinely changes how a deal gets priced — or whether it gets done. The combination this requires is unusual: someone who has lived inside these systems for decades and can also read the risk like a diligence professional. That intersection is exactly where we work.