Two-Tier ERP with SAP S/4HANA Public Cloud: A Perfect Value Enabler for Sales Subsidiary and Ecosystem

This blog post is focused on some of the many the success stories of customer adoption of Two-Tier scenarios with SAP S/4HANA Public Cloud, specifically the headquarters and the subsidiary deployment, with a focus on the subsidiary as a sales office.

Terumo Corporation and How They Serve the Society:  

Terumo Inc., with global headquarters in Tokyo, Japan, is an established name involved in developing, manufacturing, and marketing medical devices and pharmaceutical products. Terumo serves society by providing quality products and services in the healthcare market while catering to the needs of patients and healthcare professionals. The company’s transition to SAP S/4HANA led to the integration of its headquarters, subsidiaries, and sales offices globally. SAP S/4HANA now manages Terumo’s manufacturing, finance, logistics, and sales elements.

Sales Office as a Subsidiary:

Terumo Inc.’s subsidiary sales offices were initially running on disparate ERP applications; however, a new business requirement called for closer integration between the sales offices and the headquarters across finance, sourcing, procurement, supply chain and sales. This business requirement was met by integrating S/4HANA Cloud as Tier 2 for the sales subsidiary with the headquarter acting as Tier 1 on legacy. This allowed for strong integration in SAP S/4HANA Cloud, where products are sold from the stock base of the sales subsidiary running on SAP S/4HANA Cloud.

In order to fulfill and replenish orders, the subsidiary system raises a purchase order, triggering the headquarters system with an automatic sales order creation. With ECC / SAP S/4HANA, sales orders are generated, inventory is dispatched to subsidiaries, and invoices are seamlessly shared between subsidiaries and headquarters. Terumo was able to integrate SAP S/4HANA Cloud with a wide range of other systems using a CPI integration as shown in the architecture diagram below.

                                      Image source:  Team Terumo and Deloitte

SAP S/4HANA Cloud allowed for a simplified integration between the headquarter and subsidiaries which lowered the total cost of ownership. SAP S/4HANA’s built-in localization support made it possible to maintain local compliance for each subsidiary country throughout the global rollout. In addition, SAP best practices along with the SAP Activate methodology and SAP S/4HANA’s embedded analytics capabilities made implementation quick, seamless, and valuable for customers.

Value with Two-Tier ERP Strategy for Terumo

                                  Image source: Team Terumo and Deloitte

 

By leveraging SAP S/4HANA Cloud, which serves as a Tier 2 for Terumo, the organization was able to accelerate its transformation journey to the Cloud with its Sales subsidiary and adopt innovative business processes. For the sales subsidiary at Terumo, full-suite financial and management accounting was implemented following the corporate structure, and reporting was set up with five different legal entities in different geographic regions.

During the implementation of Terumo’s Two-Tier, Deloitte played a vital role as a partner, helping and supporting the fast and smooth process. By doing so, Terumo was able to move forward with its strategy.

Inside SAP S/4HANA Podcast

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openSAP microlearnings for SAP S/4HANA

Just a couple of months ago, we launched openSAP microlearnings for SAP S/4HANA as an exciting new learning opportunity. What began with a small batch of 20 videos, has now become a channel with more than 50 microlearnings that have generated over 20,000 views since then. Today we cover multiple lines of business, like Finance and Manufacturing & Supply Chain, and key technology topics like Master Data Management, Extensibility, User Experience, and Upgrade Management. We are continuously adding new microlearnings to the SAP S/4HANA channel, so make sure you check them out.

Your Voice Matters!

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For more information on SAP S/4HANA Cloud, check out the following links: 

  • The power of best-in-class and Next Practices business content for a modern ERP blog post
  • SAP S/4HANA Cloud: The Intelligent ERP blog post
  • SAP S/4HANA Cloud: New Product Releases here
  • Latest SAP S/4HANA Cloud Release blog posts here
  • SAP Intelligent Robotic Process Automation Content here
  • SAP S/4HANA Cloud release info here
  • SAP S/4HANA PSCC Digital Enablement Wheel here
  • Inside SAP S/4HANA Podcast here
  • SAP S/4HANA Cloud Community here
  • SAP Activate Community here
  • Best practices for SAP S/4HANA Cloud here
  • Help Portal Product Page here
  • What’s New here

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