■Perspective of LBC's ERP overseas expansion service
We all know the fact that the overseas subsidiaries of Japanese firms have adopted separate local packages to build the business handling process.
This is because of the necessity to build a system so that the business handling system can be used by the local staff whcih can withstand the day to day troubles promptly and which ought to match the local laws and commercial practices.

However, with the advancement in globalization, the environment required for the enterprises has been undergoing drastic changes over the past several years.
In addition to it, there has also been a growing demand for the processes complying with the international accounting standards.
On the other hand, rapid economic growth in the developing nations has increased the dependence of sales dramatically.
In the light of the above, there may be a necessity to take action on the basis of the following aspects in the core business system of these enterprises in order to cope with such changing environment.

1. Visualization of administrative conditions (Financial status, business process, decision making process etc.) of the overseas subsidiaries
2. Common platform to build internal control system
3. Compliance with International Accounting Standards (IFRS)
4. Early adoption of consolidated financial settlement
5. Formulation of global unified code

■Features required for core business system (ERP system)
The following conditions are required in the core business system (ERP system) in order to achieve the above aspects.

1. Provision for multiple currencies
2. Provision for multiple languages
3. Compliance with the requirements at country level for all countries
4. Abundant solutions that suit the commercial practices and laws specific to each country
5. Availability at global level
6. Provision for approval authorizations and workflow settings for building internal control system
7. Compliance with International Accounting Standards or assurance to comply with International Accounting Standards

■ Procedures for LBC's overseas expansion
Before proceeding with the overseas expansion, one company is selected among the relevant companies for introduction and requirements are defined for that country for introduction purpose.
As for the criteria in this case, it becomes necessary to select a company with higher sales and also with complicated business processes.
But it is not advisable to select India or China which may be considered as the countries with complicated national requirements.
Common functions are seggregated to the group company from the deliverables accomplished during the requirements definition stage which is treated as a [Template].
To be concrete, it includes [Standard workflow]. [Standard Operation Manual], [Standard System Parameters (Such as Account items etc.)] or, [Common Addon System] and so on. This template is developed and applied sequentially for the relevant company for expansion.
The purpose of building a template is to achieve standardization of business process at global level, short term introduction and cost reduction in such a way that system can be introduced even in overseas subsidiaries without extra finances.



■Building of global template
First of all, the framework of the global template is created. This framework undergoes changes as and when there is expansion locally. Various local functions are added during the stage of local expansion.
This occurs because globally used functions out of these local functions are incorporated into global template.
Further, global template is developed in such a way that the supply chain between the overseas subsidiary or local companies and headquarters is integrated.
The concept of typical supply chain integration is as shown in the figure below.



■Local expansion of global template
Global template, when taken to the site, first of all, it is reviewed by local staff on the basis of standard business flow and standard system.
Based on these review results, preparations will be made for expansion by making up the deficiencies.
Later, training is imparted to the local staff further to start implementation test.
On completion of implementation test, Go-Live data is migrated further to start preparations for Go-Live operations.
The important aspect, in this case, is the decision on support system post Go-Live and preparations.
Normally, on-site process may be confusing after Go-Live owing to lack of experience. In order to minimize this confusion, our consultants provide support on site for a fixed period after Go-Live.
Later, it is a normal practice to shift to HelpDesk and application maintenance contract when the things are quiet and sober.
The key point here is the language used to offer the services. We are able to offer our services in Japanese, English, Chinese and Korean.
We involve our consultants who can offer the services in respective languages during local expansion phase.
To put it in a simple way, apart from our consultants, we also involve consultants from India who are in charge of helpdesk for English.
As for Chinese, Consultants from China who are in charge of helpdesk also take part during local expansion phase.

■ About Network
Installation of server in the respective local companies may prevent network problems as long as there are no branches for these local companies.
It is higly risky to operate the core business system without posting full time administrators by presuming that it is not practical to setup servers in the respective overseas subsidiaries and post the administrators except for large scale operations.
Therefore, servers are normally setup in the data centers of Japan all together for overseas expansion of ERP system.
As for the global network in this connection, since it proves highly expensive to establish the network exclusively, it is a normal practice to build global network with IP-VPN.
If it is IP-VPN network, security related problems or problems related to circuit quality are likely to crop up.
In this case, it is a normal practice to go for thin client with Xen Server to resolve this problem.



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