Tuesday, November 15, 2011

ERP in an Adjacent Possibility Model

Leverage the capabilities in a governance by design to enable the adjacent possibility model.  
  1. ERP features - Assumptions derived by the appropriate use of technology to enable policy systematic processes and logic based on features in technology investments.  
    1. Company Code - Consolidation of various buy-sell entities or groupings of countries based on the regulatory controls within a certain region.  
  1. Limits risk exposure to the grouping, with a legal company created within the region.  
    1. Company 1 - Buy Sell 1
      1. Acquisition 1 - Buy Sell 1
    2. Company 2 - Buy Sell 2
      1. Acquisition 1 - Buy Sell 2
      2.  Location Code - Ideally ISO country codes - drives your aggregation of legal relationships;
  1. Location Code-As a child of each company code, assign the static ISO country code structure 
    1. A grouping of locations (ISO Countries) within the company code
    2. Must align to consolidation in natural roll ups
      1. A record does not change the rules in this static source
      2. A record simply assumes an exception that was allowed for a single event, a single code must be used to manage the exceptions, monitor and measure the rules effectiveness.
    1. Partners by country - Go To Market - Rarely would a partner be entitled and authorized to sell in more than one country.  
      1. Partner 1 - 123 (ISO code)
        1. Partner 2 - 123 (ISO code)
        2. 456 (ISO code) Exception
      1. The exception would allow a partner to have more than one country controlled by regulatory rules and buy sell grouping.
      2. The partner must have a buy sell (right to operate as an entity in those additional countries.  
        1. This must be confirmed by legal evidence of arrangement modified to confirm the liability and terms within that country have been executed by both companies. 
    1. General Ledger Code-Account code grouping by standard accounting rules, corporate policies define the procedure and legal contracts assign the authorization to acquire by supplier.  
  1. Suppliers do not automatically have authorization to sell to a company simply based on having a supplier record.  
    1. The contract terms of the relationship relies upon the general ledger account codes which the supplier was authorized to sell by country. 
    2. If the supplier hasn't created a buy-sell in the region, they would not be authorized in that region.  
    3. Acquisition audibility  

**Please see the following assumptions

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