Cre8tive Technology & Design (www.ctnd.com) will be posting a three-part series on “Choosing the Right ERP Solution to Support a Global Business”
Part One Each Business Unit Chooses its Own Solution
Part Two Consolidating the Entire Business on a Single ERP Solution
Part Three Using a Combined Solution
Part Three – Using a Combined Solution
In response to the cost and complexity of a single Tier-1 strategy, many organizations are now moving to a dual vendor approach that uses a centralized Tier-1 ERP for the major parts of the business and a standardized Tier-2 ERP in the business units. Ray Wang of Constellation Research found that a two-tier ERP strategy was growing in popularity with more than half of companies surveyed saying they were considering a two-tier ERP approach.
As the consolidated parent system, the Tier-1 ERP can handle high data volumes and has the features necessary to manage transactions and reporting for the large numbers of employees and users that typically work in headquarters. In addition, the Tier-1 ERP allows organizations to centralize functions that require consistency across the entire company, including procurement, operations, architecture, standards, processes and ERP application development. These functions can then be supplemented by a single approved application that is implemented in business units where it is cost prohibitive to deploy the larger package. For such distributed units, a solid Tier-2 player is a sound alternative.