Taking your organization across borders

From handling multiple languages and currencies to ensuring compliance with local tax laws and regulations, global ERP implementation projects can certainly be daunting. So, how do you simplify the localization process and make the right choices for your organization? Below, we’d like to discuss some of the topics you need to consider and how a solid ERP solution can help your organization scale internationally. 

Localization isn’t limited to local languages and currencies. Areas such as regulatory requirements must also be considered, and these vary depending on the country. For example, within Europe alone, taxes, VAT, and regulations can be completely different from one country to another. And there are other practical things to consider. For instance, what are the options for local internet access, and can it support your new solution?  

But before you consider these local factors, it’s vital that your data is standardized and aligned with your business language and currency.  

Common Data 

Working from a shared data source is essential to an influential international ERP implementation. It enables organizations to consolidate financial data and share data about customers, vendors, items, prices, etc. Achieving common data depends on how the organization operates. For instance, do your subsidiaries sell different products in different markets? Or do the various countries and sites operate in the same market with the same products? Depending on your setup, ERP solutions can offer great opportunities. For instance, with common markets and products, it’s possible to implement everyday customer and supplier numbers, allowing for enhanced credit control. Or you can move around surplus materials and quickly respond to emergency shortages. Plus, it’s easy to consolidate purchases and place orders through a subsidiary located close to the supplier for additional cost savings.  

Language 

You can use one common language across borders and streamline your processes across your subsidiaries. But then, how do you handle local languages for local resources? An intelligent ERP solution lets you set up local language requirements – so your New York office sees the system in English while your Paris office sees it in French. This way, everyone works with the same system and data but in the local language and complies with local regulatory requirements. English is often the common business language for global organizations, but you must confirm that the people handling daily operations are comfortable working in English. And remember, language isn’t just about spoken word. All materials, including GUI screens, notifications, training materials, and manuals, must be translated into local languages to expand into new countries and regions.  

Currency

ERP solutions can translate currencies across borders, allowing users to see financial data in their local currencies and ensuring efficient management of global transactions. For example, economic data from the Paris office can be displayed in US dollars when viewed by employees at the New York office. This makes it much easier to manage the financials across borders. All-in-one solutions like Microsoft Dynamics 365 also allow new currencies to be added alongside the base currency. And if the currency you need is unavailable, it’s possible to define custom currencies based on user-defined exchange rates. 

Time zones

International organizations have various locations worldwide and customers in different time zones. Working in multiple time zones can be challenging, especially when scheduling activities. Time zone functionality in Dynamics 365 lets you create and synchronize activities and align them with the time zones in Microsoft Outlook. For example, if your New York offer schedules an activity with attendees in Paris and Sydney, all participants will see their activities displayed in the time zone in which they are located.  

Regulations and global compliance

International organizations are constantly challenged by the need to meet local regulations in their countries. That’s because regulatory requirements often change and can vary from country to country. Some ERP solutions don’t guarantee legislative compliance regarding issues like Brexit and GDPR. However, other solutions, such as Dynamics 365, are GDPR-compliant and support major global, governmental, regional, and industry regulations. This makes it easy for organizations to comply with and respond to new standards and regulations. 

VAT

Over 170 countries impose a Value-Added Tax (VAT) in each good or service production stage. And as usual, this consumption tax varies from country to country. Even rates within EU member states aren’t uniform. For example, the highest standard VAT rates are in Hungary (27%), Croatia, Denmark, and Sweden (25%), while the lowest rates are in Luxembourg (17%), Malta (18%), Cyprus, Germany, and Romania (19%). There can also be exemptions if a country levies reduced rates for certain goods and services, such as tourism, to help promote local services. Thankfully, there are solutions that take the heavy work out of managing all this. For instance, with Dynamics 365, users can set up different VAT rates tailored to specific needs. Rates are based on local requirements, and it’s possible to set up customized VAT rates if a customer is exempt.

Supporting infrastructure  

Today’s cloud-based ERP solutions require fast internet access and sufficient bandwidth so all users can connect and effectively perform their tasks. This means these solutions are only as effective as the local infrastructure allows. That’s why validating your legacy infrastructure before implementing it is essential. Speedy internet isn’t available in some regions, so you might want to contract a second internet provider as a backup. Organizations also need to consider how to handle support for the new ERP solution- will there be centralized or local ERP support and help desk functions? Again, language can be an issue here- if there’s no local support available, users can only access support in a foreign language or from a different time zone. 

Cultural impact

Implementing an ERP solution will fundamentally change how people work, so getting strong buy-in from the entire organization is essential- not just top management. All future users should be involved in the implementation process and provide their input and guidance. This helps ensure everyone understands the new system’s benefits and accepts the project objectives. The implementation process must recognize and respect the company culture and the different local cultures throughout the global organization. 

Think Global – Act Local

Localizing your ERP solution to meet regulatory requirements, language requirements, and local best practices is vital for successful international deployment. And thanks to out-of-the-box localized software, you can have peace of mind knowing you’re always compliant with local legislation. Dynamics 365 offers a full suite of business applications and localized ERP packages so customers can select the localization for their country and enable market-specific business processes. The latest release of Microsoft Dynamics 365 (2022 release wave 1) is available in more than 70 countries and regions worldwide. 

Global experts

Organizations should partner with local experts with a solid grasp of the local regulations, language, and culture to secure successful implementation. Here at Pipol, we aim to take the complexity out of the localization process and help you make the right choices for your organization. With offices in more than 85 countries and a committed alliance of more than 80 leading local Microsoft Dynamics partners worldwide, we have the competencies and global presence required to support you wherever you’re located.  

Download our eBook “5 Steps Guide to International ERP” and learn more about the steps to having a successful International ERP solution.