NEC strengthens internal core system using two-tier ERP

Tokyo, September 27, 2016 – NEC
Corporation (NEC; TSE: 6701) today announced that it will
progressively introduce and deploy a core system  using SAP’s cloud-based
enterprise resource planning (ERP) solution, SAP® Business ByDesign®, to NEC Group companies throughout the world in order to
further strengthen global management. NEC New Zealand Limited initiated the
first system in September this year.

NEC standardizes the business
processes of sales, accounting and purchasing that are individually optimized
for each NEC Group organization and company, and supports the business by
establishing a core system that uses the SAP ERP application. The expansion of
the core system to NEC Group companies began in 2010.

NEC has decided to apply these
standardized business processes to NEC Group companies that have not yet
introduced the core system by deploying SAP Business ByDesign. It has a high
degree of compatibility with SAP ERP, and can flexibly deal with a wide variety
of conditions.

This project is based on the
two-tier ERP concept and aims to realize total optimization globally. NEC will
maintain the core SAP ERP application (tier 1) that has already been introduced
at headquarters and primary group companies. Now, it complements this
investment by deploying the highly flexible SAP Business ByDesign solution
(tier 2), which can be introduced at a low cost in a short period of time, at
its subsidiaries.

Taking advantage of the high
compatibility between these two solutions, and promoting the linkage of
management data, NEC strengthens corporate governance through improved
transparency of management information and expediting account settlement. It
also supports the locally based management and real-time business analysis for
each company.

In addition, NEC will promptly and
flexibly adapt to the changes in a wide variety of business environments—such
as legal systems, commercial practices, new entries, M&A and the market
fluctuations of each country—by using the SAP Business ByDesign solution for
medium-sized companies. It will also develop the methods and principles of
switching to a core system using SAP ERP in line with future business growth.

NEC will model the knowhow of the
introduction and deployment of the core system using this in-house SAP Business
ByDesign, as well as the coordination and migration of the core system using
SAP ERP. NEC will offer it as a two-tier ERP solution that helps enhance the
global management of a customer’s business.

NEC offers a comprehensive
introduction and deployment service using the ERP template that is compatible
with SAP’s latest product, SAP S/4HANA, which supports tier 1 of the two-tier
ERP solution, as well as SAP Business ByDesign, which supports tier 2.

NEC will continue to provide global
support mechanisms that meet customer needs related to SAP solutions in
cooperation with ABeam Consulting Ltd., an NEC Group company, and United VARs,
a global alliance member of SAP partners.

“SAP welcomes
NEC’s initiatives to further strengthen its own global management platform by
deploying SAP Business ByDesign in addition to modernizing its SAP ERP solution
on SAP HANA. The two-tier ERP approach using SAP products makes it possible to
integrate information of both the company’s head office and its overseas
subsidiaries, helping to improve not only management transparency but also
speed of management information exchange. NEC has been engaged with SAP for
many years, and I look forward to working together to contribute to further
innovation for our customers in the future,” said Michael Schmitt, senior vice
president & general manager, SAP Business ByDesign, SAP.