Consolidating Subsidiary Finances: From Stress to Simplicity with a Two-Tier ERP Strategy

In an ideal world, every multinational organization would run its entire global operations on a single ERP. However, the reality is, only a few achieve this financial nirvana – and at a significant cost. The rest have to make the best of consolidating reports and finances or use a complex library of different tools across their global subsidiaries.

This is where two-tier ERP comes in: when the parent organization runs on one system and subsidiaries operate a smaller version of the same platform. This allows information to be easily consolidated, giving the parent company a comprehensive view of the subsidiary’s operations.

What is a two-tier ERP?

Two-tier ERP is a business and technology strategy that enables organizations to keep their existing ERP systems at the corporate level, while empowering subsidiaries to use a secondary version of the same solution.

Why implement a two-tier ERP strategy?

There are several reasons why more and more multinational organization implement a two-tier ERP strategy. As the business world becomes more fast-paced, organizations are placing urgent demands for financial information. For example:

Management leaders increasingly expect near-instant visibility and oversight. They know that up-to-date information can make the difference between profit and loss.
Business decision makers demand more agility to respond to changing market conditions –once they have the latest information in front of them, they want the capacity to act on it.
The best opportunities often lie in fast-developing international markets or innovative new business models, where speed and agility are essential to stay ahead of the competition.

As a result, today’s business environment demands a two-tier structure that can offer subsidiary operations the cost profile, agility and adaptability to local requirements they need. At the same time, it must give parent organizations better oversight, information access and change management without the overhead of costly recurring integration work.

Two-tier ERP strategy for multinational companies on SAP

At Vision33, we’ve helped multinational organizations across a range of industries capitalize on the benefits of the two-tier ERP model. Watch our recorded webinar as we outline the benefits of the two-tier ERP model and learn how to:

Centralize, streamline, and automate intercompany transactions
Embed controls and a consistent process across your organization
Provide visibility into your operations across your organization
Envision a future enhanced with accuracy and confidence, company-wide

This webinar will help you decide if you have the right processes in place, or if it’s time to invest in the future of your company with an ERP solution that can support your two-tier ERP strategy.