Webopedia on Google+Webopedia on TwitterWebopedia on FacebookTech Bytes Blog
Main » TERM » T »

two tier enterprise resource planning (ERP)

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. Two-tier ERP software is often used by large corporations with multiple sites or by 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, 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

1. What is ERP?
2. What is small business ERP?
3. What is enterprise application?
4. What is the difference between CRM and ERP?
5. What is an ERP module?







TECH RESOURCES FROM OUR PARTNERS
LATEST ARTICLES
Slideshow: 5 Hot Holiday Gifts for Tech Enthusiasts

From cute electronic toys to VR gaming, here are 5 hot gifts to give to your special tech enthusiast this holiday season. Read More »

What's Hot in Tech: AI Tops the List

Like everything in technology, AI touches on so many other trends, like self-driving cars and automation, and Big Data and the Internet of Things... Read More »

DevOp's Role in Application Security

As organizations rush to release new applications, security appears to be getting short shrift. DevSecOps is a new approach that holds promise. Read More »

STUDY GUIDES
Java Basics, Part 1

Java is a high-level programming language. This guide describes the basics of Java, providing an overview of syntax, variables, data types and... Read More »

Java Basics, Part 2

This second Study Guide describes the basics of Java, providing an overview of operators, modifiers and control Structures. Read More »

The 7 Layers of the OSI Model

The Open System Interconnection (OSI) model defines a networking framework to implement protocols in seven layers. Use this handy guide to compare... Read More »