In our previous articles, we discussed why on-premise applications do not make sense anymore in Latin America because they offered no economies of scale. Why would you try to be an expert on e-invoicing compliance in Latin America? Don’t you rely on tax experts and consultants to keep up with the changes? Why then would you try to figure out how your IT systems need to be configured to stay compliant when you can pay a simple annual fee to set it and forget it.
We also discussed the weakness of traditional business networks including e-invoicing networks, EDI Value Added Networks, and 100% cloud based services – there are no contingency plans when the network is slow which affects your ability to ship product. Additionally, you are still left with 80% of the effort to monitor and maintain compliance as they don’t manage the ERP configurations which are required when the government changes.
So the Hybrid Architecture is the strategy winning the day. By providing the best of both worlds, SAP Centers of Excellence are turning to this implementation model to manage local government issues such as Brazil Nota Fiscal, Chile DTE, Mexico CFDI, and Argentina eFactura.
The Hybrid E-Invoicing Model for Latin America has an on-premise component that:
- Manages the unique configurations of an end user’s SAP system
- Buffers the centralized SAP system from forced upgrades when the government announces changes
- Relieves the SAP COE from having to understand, interpret and implement the local changes into the corporate SAP system. This on premise component manages the “Delta” and change management so you don’t
- Manages the internal printing network & allows “Contingency” printing if the network is down so you can always ship to your customers and close your books at the end of the month, end of a quarter and most importantly end of the year.
Combined with the power of a network which brings:
- Economies of scale to operating costs (i.e. all companies use the same government web services) – why would you want to support those and monitor those connections on your own.
- A Single Source for Support – no finger pointing. Your local teams can access support in a local language (Spanish and Portugues) and your SAP team can call in English.
- Guaranteed compliance – the service monitors the changes and will implement them so you don’t have to throughout the year. This is done at a fixed and predictable cost, so what was once constant fire drills turns into peace of mind.
- Multi-country connectivity so you can comply with the mandatory requirements in Brazil, as well as Mexico, Argentina and Chile via a single provider.
The Ah-Hah moment and take away:
- On Premise deployments are expensive to maintain, disrupt the change management and COE standard upgrade policies, and do not take advantage of any economies of scale which creates out of control costs.
- A 100% cloud offering still leaves your IT team supporting 80% of the work (i.e. figuring out how to get your SAP system integrated with the government processes) and has no way of providing on premise contingency (i.e. this means that if the network is down – you can’t ship).
The Hybrid Cloud Architecture is the only economical way to manage Latin America E-Invoicing compliance.
- Eliminates SAP ERP change management and day to day support issues
- Eliminates the IT staff from having to react to constant changes in legislation
- Allows for on premise contingency
- Takes advantage of economies of scale
- Provides the benefit of the managed service support so you have help when something goes wrong
- And when you add it all up, the Hybrid Cloud model lowers the total cost of maintaining SAP in throughout Latin America.