Jesse Mardis It is very hard to suggest a strategy without in-depth knowledge of your existing infrastructure and your near and long-term goals. Based on what you've described above, I suggest keeping your work in SQL Server unless you run into something that requires you to work in FGDB. We ship an FGDB just because that is the easiest way to package up the content o deliver it to you.
How exactly you go about this is a decision that will be unique to each organization. I recommend a careful read of the documentation here: Local Government Information Model | ArcGIS for Local Government . There are links to tools that will help you migrate an update, and also some discussion on the Get Started - Overview page of strategies for migrating.
There are also some good videos on E380 that might help you decide how to proceed. Here's one example: Home | Esri Video
The simplest strategy - in my opinion - is to pick a solution that will help your organization in some way, and to start there. Organize the few datasets that are needed for that solution, build out the maps and apps, and then move on to the next one. Working in small chunks like this will be a lot simpler than biting off the whole LGIM and you get results in the form of a workflow or app very quickly. The end goal of the LGIM is, after all, to help you organize your content so that it is more usable.
