two tier enterprise resource planning (ERP)
Two-tier enterprise resource planning (ERP) is used by an organization to run two integrated ERP systems simultaneously. One system, the legacy application, is typically deployed at the corporate level and the other managed at the subsidiary level. Two-tier ERP software is often used by organizations with multiple sites or an organization that's based in multiple geographic locations.
Recommended Reading: Webopedia's enterprise resource planning (ERP) definition.
The Benefits of Two-tier ERP
Two-tier ERP enables an organization to optimize regional back office processes at a site that operates under a business model that is separate from the main company. At some locations the ERP requires special considerations — including translations or regionalized business models — and organizations my look to maintain a legacy ERP at headquarters with two-tier ERP solutions to support specific needs at the subsidiary level that fully integrates with the corporate system.
Master data management is one of the biggest concerns for organizations deploying two tiers of ERP. There should be no duplication of effort between the two ERP systems. Consistency is required at the second tier to ensure the corporate first-tier ERP achieves a single source of information for financials, orders and other business.
When Do Organizations Use Two-tier ERP?
Often a Two-tier ERP system is implemented when the legacy (the Tier-1 system) becomes very large and costly to customize, maintain and upgrade or when mergers and acquisitions leave an organization with multiple ERP solutions that they are unable to consolidate to a single ERP system.
According to EnterpriseAppsToday, the following scenarios are common in organization that use two tiers of ERP:
Top 5 related ERP Questions
- Watch Datamation's editor James Maguire moderate roundtable discussions with tech experts from companies such as Accenture, Dell, Blue Jeans Network, Microsoft and more »
Perceptual computing is the ability for a computer to recognize what is going on around it. More specifically, the computer can perceive the... Read More »Apple Pay Promises to Strengthen Payment Security
Experts believe that Apple Pay and other competitive payment systems will be far more secure than cards, even cards equipped with EMV chips. Read More »The Great Data Storage Debate: Is Tape Dead?
Tape clearly is on the decline. But remember, legacy systems can hang for a shockingly long time. Read More »
A network is a group of two or more computer systems or devices, linked together to share resources, exchange files and electronic communications.... Read More »Computer Architecture Study Guide
This Webopedia study guide describes the different parts of a computer system and their relations. Read More »Webopedia Polls
The trend for the past two years has been for shoppers to spend more online during the holiday season. How do you typically shop for holiday... Read More »