- 1 May 2013
Many organizations are becoming increasingly global. To support these efforts, they have established multiple sites or locations—manufacturing plants, branch and regional sales offices, distribution warehouses and national, regional, and even global headquarters—that may be distributed within a country, a region, or around the world.
As organizations expand into new territories, they face a number of operational challenges. They need to adapt to the business rules of foreign countries, including government regulations, reporting requirements and variations in tax and labor laws. They must accommodate multiple languages, multiple currencies and varying local best practices. And because companies operating in multiple countries are required by law to create separate legal entities, inventory transactions become more complex with intercompany movements being treated as purchases and sales between legal entities.
Yet even as they meet local requirements, organizations must also integrate their operations to gain visibility across all operations to support strategic decisions, enhance operational efficiency, and manage governance, regulation, and compliance (GRC) initiatives.
Enterprise Resource Planning (ERP) is a mission critical component of any business’ globalization strategy. ERP solutions automate the functions necessary to manage a wide range of local operations, from accounting to customer relationship management (CRM) to supply chain management (SCM).
The information held within an ERP system is also the key to gaining visibility into accurate, consolidated information about the business and is the foundation of the key performance indicators (KPIs) necessary to achieve corporate objectives. A well implemented ERP solution can also provide transactional interoperability. Companies that automate and streamline workflows across multiple sites, including suppliers, partners, and manufacturing sites can reduce the total time from order to delivery.
Businesses have a variety of strategies to select from when implementing ERP systems across their global organizations.
- Each business unit or division can choose its own solution
- The entire business can consolidate on a single ERP solution
- The business can use one solution to centralize and standardize key operations while using a second standardized solution for select operations within the business units.
The choice of configuration can have a profound impact on the ability to achieve visibility across the organization and deliver the functionality the organization needs to operate and grow. It also affects the cost and complexity of implementing and supporting the solution. As organizations become increasingly globalized, they recognize the value of consolidating their operations on fewer ERP systems. However, these efforts have been stymied by the cost and complexity of the limited number of systems that could meet their requirements. Today, companies should expand their shortlist of ERP solutions to vendors which offer the scalability, total cost of ownership, and comprehensive global functionality to truly support an organization’s operations. There are some solutions which provide a cost effective option to organizations that desire to use a single solution to both run their local operations and consolidate data at headquarters to provide visibility for strategic planning, improving efficiency and managing GRC initiatives.
For the upcoming weeks Cre8tive Technology (www.ctnd.com) will be posting a three part series on “Choosing the Right ERP Solution to Support a Global Business”
May 8 “Each Business Unit Chooses its Own Solution”
May 15 “Consolidating the Entire Business on a Single ERP Solution”
May 22 “Using a Combined Solution”
From an Epicor White Paper
Epicor Software Corporation is a global leader delivering business software solutions to the manufacturing, distribution, retail, and service industries. With more than 40 years of experience, Epicor has more than 20,000 customers in over 150 countries. Epicor solutions enable companies to drive increased efficiency and improve profitability. With a history of innovation, industry expertise, and passion for excellence, Epicor inspires customers to build lasting competitive advantage. Epicor provides the single point of accountability that local, regional, and global businesses demand. For more information, visit www.epicor.com.