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Published on: September 01, 2010
Type of content: WHITE PAPER
Length: 2 pages
Two-tier ERP is the use of different ERP systems at two different layers of the organisation: One system serves as the global backbone, often for processes such as financials, human resources and procurement, which can be harmonised across all divisions. (This is often referred to as administrative ERP.)
In addition to the global backbone, one or more ERP solutions (or even reconfigured instances of the same system) are used in parts of the organisation to support geographical subsidiary needs, usually for smaller operational requirements, such as sales, marketing, field services or local manufacturing.
The term "two-tier ERP" has been used for a number of years, but is also referred to as "hub and spoke" or "multitier ERP." It should not be confused with a best-of-breed approach. The main difference is that best of breed combines modules from various vendors in an overall solution, where a two-tier strategy is the combination of full ERP suites on different layers.