JD Edwards upgrade: Consolidate EnterpriseOne business units

Companies can consolidate their business units when doing a JD Edwards upgrade, but knowing how and when to do it isn't an easy task.

In today's dynamic business environment, it is important to keep upgrading the business applications regularly. Each phase of the upgrade lifecycle plays an important role in the successful functioning of the system. When upgrading Oracle JD Edwards EnterpriseOne, consolidating business units can play a major role in its success.

In JD Edwards EnterpriseOne, this is called "consolidation of company." It is a process by which various business units merge. A business unit is the smallest level at which you track revenue and expenses, and could include a warehouse, a local sales office or a particular company division. Typical scenarios that an enterprise faces when upgrading enterprise resource planning (ERP) applications include:

  1. Adding new business units (acquired unit, verticals or departments)
  2. Selling existing business units
  3. Retiring existing business units

Consolidation is complex. So here are some perspectives on the factors that can assist business unit consolidation in a JD Edwards upgrade. Based on the advantages and disadvantages, enterprises can decide on the right option.

Upgrading JDE EnterpriseOne, then consolidating business units

Enterprises can take advantage of a stable configuration by treating it as a baseline for new roll-outs. This makes each new roll-out of a business unit easier and more streamlined, as one moves forward. Each new roll-out can copy objects and set-ups from the previous roll-out, which has already been tested and implemented. Along the way, the enterprise can nurture some great power users who lay the foundation for building an in-house implementation team for other business units.

Business requirements can identify gaps in the current system and the extent of customization needed. An enterprise can make a decision for business unit consolidation based on the following scenarios:

  1. The gap and extent of customization needed are major
  2. The gap is minor but major customization is required
  3. The gap is major but minor customization is required
  4. The gap and extent of customization needed are minor

For the first two cases, it's better to first upgrade the ERP system and then convert business units from the legacy system. This will avoid complications arising during customization. For the second two cases, it's better to first convert the business units from the legacy system and then do the JD Edwards upgrade. That will be covered in the next section.

With the first two cases, the organization must train end users on the new release. After users are familiar with the new system, then they should consider consolidating business units. This will reduce the amount of repeat training.

Evaluate whether Oracle supports your current version of Oracle JD Edwards EnterpriseOne. If it doesn't, the user should not add new business units to the system. The enterprise can hire external consultants to advise on the way forward.

Consolidating business units before a JDE EnterpriseOne upgrade

In the right circumstances -- those described in the previous section -- consolidating business units first can avoid complications arising from customization and improve day-to-day operations. For example, the business may want to take advantage of existing implementation. If gaps are major, then customization or standardization may add additional cost of ownership.

In this case, since users are well aware of the current system, it will be easier and simpler for them to configure the business units with the existing system. This can reduce the cost of implementation, as the same wheel need not be reinvented.

Oracle tries to reduce the business process gaps between product and industry standards in new releases of JD Edwards. If business processes are not changing across the release, then enterprises can attempt to roll out new business units before upgrading.

We believe enterprises should do a JD Edwards upgrade only after evaluating how to consolidate business units. This will help to reduce the cost of ownership and stabilize the system.

Nagesh Yandru and Prasant Muduli are consultants in the consulting and systems integration unit at Infosys.

This was first published in November 2012

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