NEC Strengthens Internal Core System Using Two-tier ERP

NEC Corporation (TSE: 6701) today announced that it will progressively introduce and deploy a core system using SAP’s cloud-based enterprise resource planning (ERP) solution, SAP Business ByDesign, to NEC Group companies throughout the world in order to further strengthen global management. NEC New Zealand Limited initiated the first system in September this year.

NEC standardizes the business processes of sales, accounting and purchasing that are individually optimized for each NEC Group organization and company, and supports the business by establishing a core system that uses the SAP ERP application. The expansion of the core system to NEC Group companies began in 2010.

NEC has decided to apply these standardized business processes to NEC Group companies that have not yet introduced the core system by deploying SAP Business ByDesign. It has a high degree of compatibility with SAP ERP, and can flexibly deal with a wide variety of conditions.

This project is based on the two-tier ERP concept and aims to realize total optimization globally. NEC will maintain the core SAP ERP application (tier 1) that has already been introduced at headquarters and primary group companies. Now, it complements this investment by deploying the highly flexible SAP Business ByDesign solution (tier 2), which can be introduced at a low cost in a short period of time, at its subsidiaries.

Taking advantage of the high compatibility between these two solutions, and promoting the linkage of management data, NEC strengthens corporate governance through improved transparency of management information and expediting account settlement. It also supports the locally based management and real-time business analysis for each company.

In addition, NEC will promptly and flexibly adapt to the changes in a wide variety of business environments-such as legal systems, commercial practices, new entries, M&A and the market fluctuations of each country-by using the SAP Business ByDesign solution for medium-sized companies. It will also develop the methods and principles of switching to a core system using SAP ERP in line with future business growth.

NEC will model the knowhow of the introduction and deployment of the core system using this in-house SAP Business ByDesign, as well as the coordination and migration of the core system using SAP ERP. NEC will offer it as a two-tier ERP solution that helps enhance the global management of a customer’s business.

NEC offers a comprehensive introduction and deployment service using the ERP template that is compatible with SAP’s latest product, SAP S/4HANA, which supports tier 1 of the two-tier ERP solution, as well as SAP Business ByDesign, which supports tier 2.

NEC will continue to provide global support mechanisms that meet customer needs related to SAP solutions in cooperation with ABeam Consulting Ltd., an NEC Group company, and United VARs, a global alliance member of SAP partners.

“SAP welcomes NEC’s initiatives to further strengthen its own global management platform by deploying SAP Business ByDesign in addition to modernizing its SAP ERP solution on SAP HANA. The two-tier ERP approach using SAP products makes it possible to integrate information of both the company’s head office and its overseas subsidiaries, helping to improve not only management transparency but also speed of management information exchange. NEC has been engaged with SAP for many years, and I look forward to working together to contribute to further innovation for our customers in the future,” said Michael Schmitt, senior vice president & general manager, SAP Business ByDesign, SAP.