IT-Carve-out: How to adapt your business processes to local markets

SNP Experts
| 2 min read

More and more international companies are removing individual plants or branches from their central SAP ERP system in order to best adapt business processes to local markets. But such a carve-out is considered costly and time-consuming. We show how to tackle the transformation as quickly, securely and cost-effectively as possible.

 

Global competitive pressure and increasingly complex business models: The demands placed on companies' business processes have increased enormously in recent years. More than ever, companies are required to react flexibly to changes and local requirements. But especially in international corporations, processes are often insufficiently aligned to the various target markets.

 

Advantages of a country-specific ERP system

As a result of advancing globalization and an IT architecture that has grown over many years, heterogeneous system landscapes have emerged in many places. Some oft hem are already being harmonized. However, a central ERP system is not the optimal solution for all business processes when it comes to serving local markets in the best possible way.

A country-specific ERP system has the decisive advantage that regional information from individual business units can be processed quickly and error-free. In addition, key regional company figures are available at short notice, customer relationships in high-growth regions are strengthened and regulatory requirements are met.

 

Carve-out – a project with great significance                                                                                                        

The outsourcing of individual business units or plants, however, entails serious changes in processes, organizational structures, strategies and corporate infrastructures. In such a carve-out, a new system is set up: Companies adapt their local data and processes individually, migrate or convert relevant data from the old to the new system.

Since ERP systems are very important for the entire company, planned business transformations must be implemented quickly, securely and without impacting corporate business. In order to reduce system downtime to a minimum and to influence ongoing operations as little as possible, the so-called near-zero downtime procedure has proven its worth.

 

Success Factor Software: Criteria for Selection

Ideally, ERP transformations are automated or partially automated. This approach offers enormous advantages over manual implementation: less susceptibility to errors, minimized resource requirements and lower costs. A standardized procedure also has a positive effect on lead times and project duration and minimizes the project risk.

Choosing the right transformation software thus becomes an essential success factor: A well-chosen software enables precise predictions about the transformation project and supports detailed planning of the business scenario – including reliable cost estimations. Ideally, it also meets legal requirements for the conversion of accounting-relevant data. In times of constantly increasing data growth, the chosen software should be able to handle even large volumes of data. If the methodology has a transformation memory, best practice can also be used for future projects – resulting in further potential savings.