4HANA Cloud.pdf

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Two-Tier ERP with SAP S/4HANA Cloud

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© 2021 SAP SE or an SAP affiliate company. All rights reserved. ǀ
Disclaimer
The information in this presentation is confidential and proprietary to SAP and may not be disclosed without the
permission of SAP. Except for your obligation to protect confidential information, this presentation is not subject to your
license agreement or any other service or subscription agreement with SAP. SAP has no obligation to pursue any course
of business outlined in this presentation or any related document, or to develop or release any functionality mentioned
therein.
This presentation, or any related document and SAP's strategy and possible future developments, products and or
platforms directions and functionality are all subject to change and may be changed by SAP at any time for any reason
without notice. The information in this presentation is not a commitment, promise or legal obligation to deliver any
material, code or functionality. This presentation is provided without a warranty of any kind, either express or implied,
including but not limited to, the implied warranties of merchantability, fitness for a particular purpose, or non-
infringement. This presentation is for informational purposes and may not be incorporated into a contract. SAP assumes
no responsibility for errors or omissions in this presentation, except if such damages were caused by SAP’s intentional or
gross negligence.
All forward-looking statements are subject to various risks and uncertainties that could cause actual results to differ
materially from expectations. Readers are cautioned not to place undue reliance on these forward-looking statements,
which speak only as of their dates, and they should not be relied upon in making purchasing decisions.

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Monetize multi-sided
business networks
Deliver new
integrated value
proposition
Build new customer
relationships
New and changing business models
Sell mix of
outcomes, usage
and subscriptions
Introduce flexible
payments and automate
financial process
• Direct to consumer
• Multi-channels
• New market segments
• Expand geographically
• From physical to digital
• Maintenance services
• Loyalty points / rewards
programs
• IoT services
• Sell through
• Sell with
• Resell
• Bill on behalf of
• Fixed price
• Installation fees
• Recurring fees
• Usage-based
• Outcome-based
• Financial regulation
prepaid models
• PSP’s integration
• Increase financial
performance

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Enterprises are making the move…
40%
49% 50%
59%
New Business Acquisitions Divestures New Joint
Ventures
EXPECTED CORPORATE STRUCTURAL
CHANGES*
59% 56%
51%
38%
16%
Use
shared services
delivered by
corporate
Run completey
independent
operations
Only receive
products/services
from Corporate
and resell
Manage financial
plans jointly with
corporate
Manage
joint O2C
processes with
Corporate
APPROACHES TO MANAGE
SUBSIDIARIES/AFFILIATES*
40%
38%
36%
34%
30%
29%
29%
Incompatiable IT systems
Lack of IT resources for integration projects
Lack of operational resources for integration projects
Lack of senior corporate management buy-in
Localized reporting
Lack of standardized business processes
Siloed organizational cultures
DIFFERENT CHALLENGES*
*Source: IDC InfoBrief, sponsored by SAP - The Intelligent Enterprise Benefits from Two-Tier ERP, April 2020

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Cloud solutions are a great choice…
Predictable,
Lowest TCO
Continuous
Innovation
Simple, Reliable,
and Safe
Speed
CLOUD INVESTMENT
2x
increase of spending
on cloud to over $530
billion by 20211
CLOUD ADOPTION
73%
of organizations have at least
one application, or some
computing infrastructure
already in the cloud2
CLOUD IN FINANCE
72%
of organizations have plans
to leverage the cloud for
financial applications3
CLOUD COST SAVINGS
Up to 40%
reduction of IT overhead
costs with the cloud4
1 https://www.forbes.com/sites/sap/2017/10/31/idc-2018-predictions-if-youre-not-in-the-cloud-youre-isolated-from-innovation/#7c5f83e75713
² https://www.idg.com/tools-for-marketers/2018-cloud-computing-survey/
3 https://www.gartner.com/smarterwithgartner/3-things-to-know-before-moving-financial-applications-to-the-cloud/
4_https://www.mckinsey.com/~/media/McKinsey/Business%20Functions/McKinsey%20Digital/Our%20Insights/Creating%20value%20with%20the%20cloud%20compendium/Creating-value-with-the-cloud.ashx

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Driving Two-Tier landscape scenarios,,,
Time and agility is the essence
HQ/ Corporate
Subsidiary/Affiliate
e.g. Financial Shared
Services,
Central Procurement
Subsidiaries
HQ
Central Services Supply Chain
Ecosystem
Dealer Contractor
e.g.
....

Why S/4HANA Cloud?
S/4HANA
Applications
In-App
Extensions
Custom
Applications
Partner
Applications

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SAP S/4HANA: Next generation ERP giving complete choice
SAP S/4HANA Cloud
SaaS
SAP S/4HANA
on any infrastructure
UX (role based,
any device,
digital assistant)
Intelligence & Automation
S/4HANA In-App
Extensions
Custom
Apps
Partner
Apps
Openness & Extensibility
Industry Best Practices
LoB Coverage
Security & Compliance

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SAP S/4HANA offers flexibility of consumption
SAP S/4HANA Cloud
SaaS
SAP S/4HANA AnyPremise
on any infrastructure
As a Service As a Product
Implementation Greenfield with data / configuration migration Greenfield or conversion of existing implementations
Upgrades 2-4 x year, managed by SAP Customer driven and managed
Scope Full S/4HANA scope of core ERP & extended LoB content Unlimited variety of SAP and Partner Add-ons
Extensibility In-App & Side by side via SCP / Extensibility Framework Unlimited customer specific customization, modification and extensibility
API Hub with >300 APIs
Deployment IaaS (SAP Data Center or GCP, MS Azure or Alibaba Cloud) IaaS, Customer Data Center, Hosting Providers
Configuration Standardized, Best Practice / Model Company based Model Company as starting point (recommended)
Restricted IMG access Open IMG access
Operations 99.9% Availability and High-Availability Customer and provider defined
Security SAP Cloud security and data center strategy as SPOC Shared customer / IaaS obligation
Licensing Subscription-based BYOL + infrastructure subscription
ONE Codeline
ONE Data Model -- ONE Semantic -- ONE UserExperience
Degree of Standardization
Degree of Flexibility

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Why SAP S/4HANA Cloud for 2-tier ERP ?
Corporate Leverage to Give
Subsidiaries Competitive
Advantage
Increased Corporate
Governance and Control
▪ Complete business solution
▪ Flexible digital platform
▪ Machine learning to optimize
and automate standardized
processes
▪ More efficient business
processes with SAP intelligent
technologies with iRPA and
situation handling
▪ Embedded analytics to enable
faster Insight to Action
▪ Predictive capabilities to
accelerate problem solving
▪ Real-time subsidiary
transparency
▪ Subsidiary visibility of ongoing
profitability and cash flow needs
▪ Standardized financial and
operational processes
▪ Support for local country tax,
regulations, and practices
Intelligent ERP to Help
Subsidiaries Thrive
▪ Compelling end-user
experience for quick adoption
▪ Easy implementation and
support for IT cost reduction
▪ Start small /grow big/scale
quickly
▪ No expensive infrastructure
required
▪ Always current with quarterly
updates
Cloud as a
Growth Enabler
▪ Easy delivery of corporate
services to subsidiaries
▪ Hub-Spoke manufacturing and
distribution strategies
▪ Easy implementation of
Corporate-wide digital models
▪ Faster ROI from M&A

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Two-Tier ERP Processes with SAP S/4HANA Cloud
Existing Scenarios for LOB
Headquarters
External & Basic Internal procurement
• Procurement directly by Tier 2 with
process visibility to Tier 1
• Central Contracts
• Centralised Purchasing
• Centralized Scheduling Agreement
• Centralized Purchase Requisition
Procure to Pay
Financial Planning, Consolidation & Profitability
• Financial Planning & upload of plan data
• Enabling Group Financial Consolidation & Profitability
• Cloud based legal consolidation
• Connectivity to OnPrem SAP BPC based consolidation
• Central Finance connectivity
Finance
• Sale from Local (Goods & basic
Services)
• Sale from Central Stock (drop
shipment process)
• Returns handling with Credit & Debit
Memos support
• Sale from HQ Direct procurement
from Subsidiary
EPPM
• Project-Based Service Procurement
• Multi-Project Scenario
• One MDS Integration for Projects
Basic Manufacturing
• Tier 2 as a production unit and internal supplier to Tier 1
• 3rd party Warehouse management integration
• Integration with MES
• Enabling Tier 2 to manage assembly for Tier 1
Plan to Product
Cash & Payments
• Cash visibility at Tier 1
• Centralized Customer Payments
• Hybrid Cash deployment
• Integration of External Payments to Customer Payments
• Treasury Workstation Payment Integration
• SAP Global Trade Services Integration
Order to Cash
Tier 2
Tier 1

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Two-Tier ERP Processes with SAP S/4HANA Cloud
Cross Topics
Master Data Scenarios
• Master Data administered centrally by MDG
• Tier 1 runs on SAP S/4HANA OP / SAP ECC and
Tier 2 runs on S/4HC – Replication using DRF
Tier 2 runs on S/4HC – Replication using API
SAP PI/PO and Tier 2 runs on S/4HC
SAP SCP and Tier 2 runs on S/4HC
• Master Data Replication – Bill of Material and
Change Master
Master Data
Financial Planning & Analysis
• Financial Planning and consolidate plan data
Manufacturing Processes
• Tier 2 as Production Unit and internal Supplier
to Tier 1
Procurement Processes
• Procurement directly by Tier 2 with visibility to
Tier 1
Sales Processes
• Drop Shipment process
Analytics
Tier 2
Tier 1

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2Tier Integration with SAP S/4HANA Cloud
Pre-delivered integrations to simplify implementations and reduce integration costs
Available with S/4HANA Cloud / Planned for subsequent releases (not exhaustive)
Manufacturing
Execution System
Production/Planned Order
Confirmations (Yield/Scrap)
Material and Production master data
Goods Movement
Quality Inspections/Notifications
Tier 1
* Direct integration or via SAP Cloud Platform Integration technology
Tier 2
SAP ERP
Advanced Shipping Notification
Supplier Invoice
Purchase Orders
SAP S/4HANA
SAP ERP
Confirmations
Customer Invoice
Sales Orders
SAP BPC
Import Planning Data
Export Actual Data for Planning
SAP Central
Finance
FI Posting for Reporting & Consolidation
SAP S/4HANA
SAP ERP
Import financial plan data
Cash flow data
Cost center, profit center
Financial closing activities
SAP Cloud Platform Apps
like Centralized customer
payments
View and Pay bills
SAP S/4HANA
SAP ERP
Suppliers
Product
BOM
Customers
Pricing Master
SAP PS / EPPM
Customer Project Status
Project WBS
Debit Memo Visibility
SAP S/4HANA
SAP ERP
Purchase Requisitions
Purchase Orders
Central Purchase Contract
Warehouse
Management
System
Purchase Order
Material and Supplier master data
Goods Movement
Inbound Delivery
FI Posting
Country Specific Payments
Tier 1
* The arrow representation implies data flow between Tier 1 and Tier 2

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2-Tier deployments with S/4HANA Cloud and other S/4HANA deployments
Implementation Support
▪ Same data structures
▪ Same reporting tools and
concepts
▪ Same KPI terms and definitions
▪ Simplified data aggregation in
external reporting tools
▪ Same UX (FIORI)
▪ Same core processes
▪ Same terminology
Reporting
▪ Delivered integrations for
multiple SAP-to-SAP use
cases
▪ Same/similar interfaces when
integrating to 3rd party
solutions
▪ Data model compatibility
▪ Same organizational structures
(company codes/sales orgs)
Integration
▪ Allows for fast and independent
implementation of subsidiary
▪ Many transferable skills sets
between S/4HANA and
S/4HANA Cloud
▪ Same preferred extensibility
concepts (In-App and Side-by-
side)
▪ Potential to re-use IP in
Business Technology Platform

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Optimize Customer Journey with SAP S/4HANA Cloud Implementation Tools
S/4HANA Trial
Roadmap Viewer
Digital Discovery Assessment
Best Practice Explorer
Quality System
Production System
System
Landscape Initial
Transport
Ongoing
Transports
Starter System
Trial System
Trial,
Discovery
Assessment
Setup and
Enablement
Fit-to-Standard
Analysis
Scope and
Configure
Migrate,
Integrate,
Test
Extend
Innovate,
Operate,
Support
Discover Prepare Explore Realize Deploy Run, Optimize
Continuous Innovation
Onboard
Users and
Deploy
Trust Center

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A global solution delivered where you need it – 43 local versions, 27 languages
Areas affected by globalization/localization
New
Markets
Access
to Talent
Digital
Technologies
Economy
of Scale
Competitive
Advantage
Foreign
Investments
Save
on Taxes
Master
Data Languages Validations
Invoicing
Payments
Statutory
Reporting Benefits
Time
Data
Taxes

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• Pre-built localization
for 43 countries in 27
languages
• Stay current with Legal Change
Notification Service
• Deep language and
internationalization
coverage (e.g. right to
left, calendars, etc.)
• Extended country reach
with partners through
extensions
(e.g. Tax Service and
Advanced Compliance
Reporting)
• In-app extensibility offers
customization and content
that’s needed by our
global customers
Local
GAAP
Legal
Reporting /
Fiscal Closing
Product
Tax
Withholding
Tax
Tax
Reporting
Invoicing
Payment
Media
Payment
Methods
Inventory
Valuation
Account
Payables /
Receivables
General
Ledger
Deferred
Tax
Tax
Payment
Automatic
Translation
Fixed
Assets
Language
Verticalization
Language
In-App &
Side By Side
Extensibility
APIs and
Services
(example: Tax)
Business
Configuration
& Content
Technology
Localization Tool Kit for SAP S/4HANA Cloud
Advanced
Compliance
Reporting
Brazil Tax
Service
Multi-
currency
IFRS
e-Invoicing
Bill of
Exchange
Payment
Formats
Invoice
Processing by
OpenText
Direct
Debit
Languages
Documen-
tation
SAP offers deep localization, configuration and content
across the functional needs of our Cloud suite’s customers:
Sample of localization content:
SAP
Delivered
Partner
Delivered
SAP S/4HANA Cloud Localization is Deep and Scalable
Advanced
Compliance
Reporting
Accounting

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S/4HANA Cloud rated as Market Leader by IDC and Gartner
Source: Gartner 2021
Gartner Magic Quadrant for Cloud Core Financial Management
Suites for Midsize, Large and Global Enterprises
IDC Marketscape Worldwide SaaS and Cloud-Enabled Medium-
Sized/Midmarket Business ERP Applications
Source: IDC 2020

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Customer Testimonials
Moving overseas offices to a
cloud ERP solution
Making the Right Business
Decisions on a Global Scale
Modernize Your Subsidiary ERP
Strategy
Improve Decision-making and
Overall Corporate Governance

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References
SAP Cloud Trust Center
SAP S/4HANA Cloud 2-Tier
Discover SAP S/4HANA Cloud

© 2020 SAP SE or an SAP affiliate company. All rights reserved.
No part of this publication may be reproduced or transmitted in any form or for any purpose without the express permission of
SAP SE or an SAP affiliate company.
The information contained herein may be changed without prior notice. Some software products marketed by SAP SE and its
distributors contain proprietary software components of other software vendors. National product specifications may vary.
These materials are provided by SAP SE or an SAP affiliate company for informational purposes only, without representation or
warranty of any kind, and SAP or its affiliated companies shall not be liable for errors or omissions with respect to the materials.
The only warranties for SAP or SAP affiliate company products and services are those that are set forth in the express warranty
statements accompanying such products and services, if any. Nothing herein should be construed as constituting an additional
warranty.
In particular, SAP SE or its affiliated companies have no obligation to pursue any course of business outlined in this document or
any related presentation, or to develop or release any functionality mentioned therein. This document, or any related presentation,
and SAP SE’s or its affiliated companies’ strategy and possible future developments, products, and/or platforms, directions, and
functionality are all subject to change and may be changed by SAP SE or its affiliated companies at any time for any reason
without notice. The information in this document is not a commitment, promise, or legal obligation to deliver any material, code, or
functionality. All forward-looking statements are subject to various risks and uncertainties that could cause actual results to differ
materially from expectations. Readers are cautioned not to place undue reliance on these forward-looking statements, and they
should not be relied upon in making purchasing decisions.
SAP and other SAP products and services mentioned herein as well as their respective logos are trademarks or registered
trademarks of SAP SE (or an SAP affiliate company) in Germany and other countries. All other product and service names
mentioned are the trademarks of their respective companies.
See www.sap.com/copyright for additional trademark information and notices.
www.sap.com/contactsap
Follow us

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SAP S/4HANA Cloud: Value across your organization
• Increase in revenue from
new offerings (10% - 20%)
• Increase in customer
satisfaction (10% - 20%)
• Reduce time spent on period
end close by 40-50%
• Reduce risk and compliance
costs by 25-30%
• Lower total cost of
ownership by 75%
• Reduce data footprint by 50%
• Increase productivity 10-40%
• Reduce total logistics
costs by 10-15%
• Reduce total
manufacturing costs
by up to 10%
• Increase on-time delivery
rates by 10-30%
• Reduce total vendor
invoice processing time
by 60-70%
CEO
CFO CIO
COO Employee
Overhaul the
corporate strategy
Make rapid,
accurate,
data-based
decisions
Constantly
deliver
innovation
Continuously
improve operational
excellence
Deliver
Customer Value
Role

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On any device, use
role based cockpits
with digital assistant
Embedded analytics for
simulation, prediction &
insight-to-action
Machine learning for
automated processing &
decision support
SAP S/4HANA Cloud
…will run your business different than before

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Central Procurement
MRP live & MRP Cockpit
Realtime Finance (UGL)
Multilevel Variant
Configuration & Simul.
Cash App
Customer 360˚
New Customer Mgmt.,
Service Core Option
Legal Content Mgmt.
Report & Repair
Malfunction
ML & Prediction
NEW Process
NEW in S/4HANA
New Insights Integration
SAP Cloud Platform
Key Industry function
embedded inside
(e.g. Automotive, Consumer,
Retail*, Mill…)
AIN
Procurement Overview
Pred. Contract cons.
One Single Invoice
International Trade
Predictive Q2Order
Embedded TM
Pred. Stock in Transit
Embedded EWM
Advanced ATP
DDMRP
Prod Engineering & Ops
Det. Scheduling PPDS
Commercial Projects
Recipe Management
Project & Portfolio Mgmt.
Closing Cockpit
Compliance Framework
Group Reporting
Multi-Channel Interaction
Center
Maintenance Overview
Asset Mgmt. for resource
scheduling
Digital Assistant
GDPR Tools
Re-architecture &
improved functions
(e.g. Chemicals, A&D, Oil
Gas, Utilities*…)
Details &restrictions…
Real-time Inventory
Cash discount at risk
SAP C/4HANA
Sales Force Support
Capacity Planning
Solution Sales
Propose mat. group,
contracts & cat items
Geographical Framework
GR/IR Monitor
Digital Content Process.
Delivery Performance
Responsibility Mgmt.
Procurement Manufacturing
Supply Chain R&D
Finance
Sales
Service Cross
Asset Mgmt. Industries
Quality Overview
DMI
IBP IPD
SAP C/4HANA
Prediction
SAP S/4HANA Cloud
SAP S/4HANA Cloud: The intelligent ERP

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SAP S/4HANA Cloud is a great fit for Mergers and Acquisitions
Pre-defined integrations to
Corporate speed onboarding
Fast implementation of
Corporate governance and
visibility speeds control
processes
situation handling
▪ Fast implementation of
Corporate financial and
operational processes
▪ Real-time subsidiary
transparency and analytics
▪ Support for local country tax,
regulations, and practices
Intelligent ERP helps the
acquisition thrive
▪ No up-front investment in IT
infrastructure
▪ Fast implementation with
reduced need for specialized
skills
▪ Fast user adoption – easy to
learn, easy to use
▪ One solution that fits the needs
of all acquisition types
▪ Reduced total acquisition costs
with a one-vendor solution – IT,
Procurement, Legal, Support
SAP Cloud leads to fast
ROI post acquisition
▪ Simplified financial
consolidations
▪ Visibility of acquisition’s
ongoing profitability and cash
flow needs
▪ Easy delivery of corporate
services to acquisition
▪ Hub-Spoke manufacturing and
distribution strategies
▪ Easy implementation of
Corporate-wide digital models

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SAP S/4HANA Cloud is a great fit for Divestitures
Standalone organizations are worth more
Cloud architecture reduces
IT costs and speeds
offboarding
Corporate governance
and visibility
facilitates valuation
▪ Complete business solution with
SAP best practices
▪ Machine learning to optimize and
automate standardized processes
▪ More efficient business processes
with SAP intelligent technologies
with iRPA and situation handling
▪ Visibility of divestiture’s
ongoing profitability and
cash flow needs to better
value the business
▪ Real-time divestiture
to avoid surprises
▪ Support for local country
tax, regulations, and
practices simplifies
transition
Intelligent ERP gives the
divestiture more value and
ensures continued success
▪ No corporate system to
painfully remove
infrastructure minimizes
separation costs
▪ One solution that fits the
needs of all divestiture types
simplifies ongoing divestiture
strategy
SAP Cloud leads to quick
divestiture independence
▪ Best of breed for high
flexibility
▪ Off-the-shelf integration to
SAP LOB’s
▪ Open API’s provide
extensive flexibility to new
owner

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SAP S/4HANA Cloud is a great fit for Joint Ventures
Joint ventures need to be independent, with Owner oversight
Pre-defined integrations to
owner systems provide
oversight without direct control
Extensive SAP country
versions provide flexibility
and reduce risk
with SAP best practices
processes
situation handling
▪ Many choices for placement
of joint venture
▪ SAP defined needs for local
country tax, regulations,
and practices reduce owner
costs
▪ SAP best practices enforce
governance regulations
(Sarbanes-Oxley, etc.)
Intelligent ERP helps speed creation
and optimize ongoing operation
infrastructure
▪ Fast implementation with
reduced need for specialized
skills
▪ Fast user adoption – easy to
learn, easy to use
▪ One solution that fits the needs
of all joint venture types
▪ Reduced total joint venture
creation costs with a one-
vendor solution – IT,
Procurement, Legal, Support
SAP Cloud leads to fast joint
venture ROI
▪ Separate joint venture financial
books with owner oversight
▪ Simplified financial
consolidations and visibility of
joint venture’s ongoing
profitability and cash flow
needs
▪ Real-time joint venture
▪ Easy alignment for
collaboration between joint
venture and Corporate owners

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Business needs by key audience
COO
Subsidiary Managing
Director
▪ Reduce time and effort to close
books
▪ Ensure financial control and
governance at subsidiaries to
manage audit, segregation of
duties, data retention, and
regulations (Sarbanes-Oxley, etc.)
▪ Optimize cash flow needs across
subsidiaries
▪ Improve visibility and analytics
across subsidiaries to better
manage financial challenges
▪ Reduce risk associated with
managing Finance across multiple
countries – multiple accounting
standards, currencies, and tax
▪ Complete solution that
supports all needs of the
business and builds
competitive advantage
▪ IT that is fast to implement,
simple to learn, cheap to
support, quick to scale, easy
to change
▪ Best business practices that
deliver world-class operations
▪ Simple delivery of information
to Corporate
CFO
▪ Reduce costs of IT
infrastructure
▪ Simplify IT environment for
implementations, support,
upgrades, integrations, vendor
management
▪ Minimize costs of managing
country localizations
▪ Reduce the cost and time
spent onboarding acquisitions
and offboarding divestitures
▪ Support the business needs of
both subsidiaries and
Corporate
CIO
▪ Deliver standard business
processes across all
subsidiaries
▪ Reduce overhead costs by
delivering Corporate services
to subsidiaries
▪ Reduce operational costs and
improve customer experience
by integrating subsidiary and
Corporate operations (Hub-
Spoke)
▪ Easily extend Corporate-wide
digital models to subsidiaries
▪ Gain real-time visibility and
analytics of subsidiaries for
better insight-to-action

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