There is nothing Second about Second Tier ERP

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Nobody likes to lose! Well I do not that is for sure and I think that many of us do not like to lose either. A second place is like losing big time. I my opinion there is no such thing as second. You win or you lose. However is it the same in the world of ERP? Is second tier ERP a bad thing?

In different articles I already mentioned age of ERP nowadays. Big enterprise companies are running their core ERP for years now. During that time these companies make many adjustments and customizations in their core and it is almost impossible to make a switch towards a new ERP. They simply can not afford it to do this. Also is building and implementing a new system way to expensive.Not to forget about the fact that it will be outdated on the moment that this is implemented and live. How do you manage your fast pace of buying and integrating companies?

What is Second Tier?

Organizations use two-tier enterprise resource planning (ERP) to run two integrated ERP systems simultaneously. One system, the legacy application, also called the the Tier-1 system, is typically deployed at the corporate level and the other is managed at the subsidiary level. Large corporations use a second tier ERP software strategy for their multiple sites or by organizations with multiple geographic locations.

6 Important Factors of Second Tier ERP
  • Open architectures that facilitate integration
  • Robust cloud capabilities that can extend throughout the enterprise
  • Ability to support multiple languages and currencies
  • Workflow capabilities that boost process efficiency
  • Industry-specific ERP capabilities
  • Support for common ERP processes and data structures

There is nothing second about second tier ERP. It is the opportunity for corporates to use the latest cloud ERP technologies for subsidiaries. Also the challenge with bought companies that have to integrate is complex to solve. If your strategy is to buy companies around the globe this is the only way to manage your entire landscape in the most efficient way. A roll out of your legacy system towards those little and fast growing companies is expensive and way to time consuming.