Almost all reasonable size organizations use some software system to integrate and control various business operations. And as businesses expand through M&A activity, JVs, etc., they tend to start dealing with a myriad of systems because these systems were already in place. The challenge of course is integrating these systems or the data from these systems with the headquarters operating system. While manually integrating two or three such systems to create a single overview of the business is not an insurmountable task, it becomes increasingly complex, time consuming and expensive to do so as the business expands further and the number of such “local” tools proliferates. And if expansion of your business leads to setting up subsidiaries in multiple countries with different legal, taxation and accounting standards, the task of integrating these tools becomes far more complicated.
Global ERP systems allow multi-company organizations to streamline and standardize operations across multiple geographies, divisions, and departments—from supply chain and inventory control to customer relationship management (CRM) and financials and accounting management.
Although implementing a global ERP system is a significant and seemingly daunting undertaking, at some point the business benefits of making the transition begin to outweigh the temporary challenges of implementation. Here are some signs that your business has reached that tipping point and should consider graduating to a global ERP system.
You have duplicate ERP systems and resources in more than one country
If you have multiple subsidiaries in different countries, you're already familiar with the issues that can arise from running a separate ERP system or worse yet, a point solution for each function at each facility.
With a global ERP system, critical business processes, such as inventory management, can be streamlined and standardized. Such a system provides a single transparent view into operations across multiple locations, meaning fewer teams are required to manage information; information flows more swiftly through the business; and executives are able to make faster better decisions.
You are manually reconciling financial and accounting information
When a local office manages its accounting data is a siloed financial system reports must be manually reconciled and rolled up into a global view. This is a time-consuming, risk-prone, and complex process -particularly when reports originate from locations with widely different tax and legal frameworks.
If your business has more than one location, you can use a global ERP to consolidate financial as well as operational data. The automated reconciliation process helps minimize the errors that often occur when multiple spreadsheets and manual data transfers are involved. Financial close times are also sped up with employees at headquarters no longer dependent on local teams to supply information nor having to synthesize accounts data across multiple formats.
Your business is struggling with multiple taxation and legal environments
Taxation, reporting, and other financial regulatory requirements are in a constant state of flux, and small changes in one location can have unforeseen impacts on business conducted with partners and customers in other locations. But keeping up with and making the quick adjustments necessary to continue operating according to local accounting and legal standards can be challenging.
A strong global ERP system should handle multiple tax schedules, be updated with the latest regulatory requirements, and automatically update currency conversion rates. And because such systems can generate receipts and invoices in multiple languages, your customers can be assured that the documentation and information they receive always reflects the latest tax and/or currency updates for their location.
Moving to a global ERP system will help consolidate financial reporting, simplify and streamline business process and practices, and save time. Additionally, a proven solution from a trusted provider offers peace of mind that your business is operating in accordance with local requirements and business models.
NetSuite is the world's most deployed cloud-based ERP system with more than 16,000 global organizations, many of them Fortune 100 companies, in more than 100 countries, across 50 tax jurisdictions, and buying and selling in more than 190 currencies,
Here at NetSuite, we have a strong track record of providing flexible, reliable global ERP systems. Take a look at our cloud-based global ERP, called OneWorld, to see how we help businesses everywhere make a smooth transition.
Read Next: How to Choose the Right Global ERP System for Your Business