Navigating the Global Landscape with Cloud ERP: Insights from PwC's Journey

[atsuko_eguchi]

In a rapidly evolving business environment, organizations are constantly seeking to unlock more productivity, efficiency, and innovation. One proven catalyst for this progress is Enterprise Resource Planning or ERP systems run on public cloud infrastructures. A cloud-based ERP system not only helps to streamline operations and ensure seamless data flow across various business functions but also brings in scalability, reducing the strain on in-house IT infrastructures.

At the nexus of ERP technology, international business, and regulatory compliance, sits a critical concept: Localization. It’s an often-overlooked aspect that can transform the business' functionality globally.

Expanding Horizons: Unlocking Global Potential with Cloud ERP Localization

Most companies operate across multiple jurisdictions with diverse tax guidelines, legal frameworks, and statutory requirements. Ensuring compliance with local standards while maintaining a globally uniform ERP system can be a considerable challenge. That's where ERP localization comes in.

Localization refers to the adaptation of an ERP system to cater to the legislative, cultural, operational, and market requirements of a particular country or a region. As part of ERP implementation, localization accounts for languages, taxation rules, fiscal obligations, and various other national considerations.

Mr. Marc Hoessels, Managing Director of PwC, explains the profound impact of localization on cloud ERP systems. Over the past eight years, Mr. Hoessels’ primary role has been to ensure tax-and-legal compliance for their global clients. He has successfully embraced localization, leading to broader adoption and substantial benefits for their clients. Mr. Hoessels adds, "With 50,000 professionals worldwide in 150+ countries, implementing a centralized approach called an acceleration package helps us comply with local requirements across different jurisdictions smoothly."

Why Choose Cloud ERP?

Cloud-based ERP solutions offer numerous benefits that make them appealing to businesses across various sectors. According to IDC’s SAP Global Future of Trust & Security Survey, the top reasons for moving to a cloud ERP system include better security, compliance, privacy, and risk posture (45%), and better alignment with company values and ESG initiatives (34%). Furthermore, cloud-based ERP users report much greater trust in their systems compared to on-prem ERP users, with 31% of cloud-based ERP users reporting 100% trust in their ERP provider.

Mr. Michael Rasch, a partner at PwC's German practice and the leader of PwC’s Global SAP Alliance, provides further insight into why PwC chose SAP's cloud ERP. Mr. Rasch shares, "PwC is an SAP user itself. We are one of the largest clients of SAP when it comes to the public cloud edition. Before we moved to the S/4HANA journey with SAP, we did a calculation on how many different accounting systems we had around the globe. We figured out we had more than 50 different accounting systems, which really made no sense for a professional service firm. That's when we decided to adopt SAP's 'golden standard' for our finance-related data."

PwC started implementing SAP S/4HANA Cloud Public Edition in central European countries like Germany, Austria, Switzerland, Belgium, the Netherlands, and Turkey. According to Mr. Rasch, "We are now rolling it out to the U.S., Japan, and other large markets. Using the public cloud also helps us limit variances and ensures compliance with specific national laws, using tools like SAP Business Technology Platform (BTP)."

The public cloud ERP's compatibility with functional localization facilitates adherence to laws, regulations, and standards in various jurisdictions, all while using a single, unified system. Therefore, alongside these benefits, organizations can harness additional productivity gains through ERP localization.

"Using SAP S/4HANA Cloud Public Edition helps us streamline our accounting systems across our 156 firms," Mr. Rasch explains. "It ensures that the larger entities in our network derive significant value from a standardized and efficient system."

These insights from the IDC’s SAP Global Future of Trust & Security Survey and Mr. Rasch's experience illustrate the significant advantages of cloud ERP solutions, including increased security, compliance, and trust in the systems used.

From Experience to Expertise

PwC leverages their own experience as a customer of cloud ERP to enhance the services they provide to their clients. This dual perspective allows them to understand the challenges and solutions intimately. PwC approaches localization with a clear understanding of a client's operations and the jurisdictions they are active in.

PwC provides a centralized approach to localization through regional expertise. Teams across Asia, the Middle East, Africa, Europe, and the Americas leverage their local knowledge of SAP solutions to aid clients' global transitions seamlessly. Mr. Hoessels notes, "The new SAP public cloud offerings, such as time-dependent tax code stamping, have proven very useful. We maintain these rate changes as a managed service, ensuring clients stay compliant with local tax regulations."

Summary

Embracing a public cloud-based ERP system, coupled with effective localization, can substantially bolster operational efficiency, regulatory compliance, and global scalability. The partnership between PwC and SAP exemplifies the power of combining advanced ERP solutions with deep localization to navigate the global business landscape effectively.

Mr.Rasch reiterates their growth and success in this partnership, having seen their practice grow around 20% year over year in the past three years, driven by the robust needs of clients and the compelling offerings from SAP. With this dynamic collaboration, PwC leads the way in leveraging cloud ERP and localization to drive transformative success for its clients globally.

Learn about Localization Today:

SAP Community for SAP S/4HANA Cloud Localization

Localization Capabilities on sap.com

SAP Community for Localization 

Building Better Trust in Business with Cloud ERP Investments