SAP Rollouts - Global Economy, Local Requirements

10/22/23, 10:31 PM SAP Rollouts: Global Economy, Local Requirements | All for One Poland
SAP ROLLOUTS: GLOBAL ECONOMY, LOCAL

REQUIREMENTS
Different Countries, Different Customs
Author: Mirosława Huk

Publication: 2013
Article published in the magazine: Better Business
SNP offers support in SAP rollout projects for international BETTER BUSINESS
corporations using corporate SAP templates – in every scope and in All for One customer
every country. As many as 40 corporations, including global and magazine
European market leaders, have entrusted us with SAP rollouts in
Europe, the US, Asia and Africa. Our extensive experience in this area
guarantees that SAP systems are compatible with both corporate
requirements and the needs of local subsidiaries.
There are many factors that have facilitated the organization of SAP
rollout projects and made them more justifiable. They include an GO TO THE
ARTICLE
https://www.all-for-one.pl/en/whitepapers/sap-rollouts-global-economy-local-requirements/ 1/15
increasingly coherent legal system in EU countries and within other D ATA B A S E
international organizations, business globalization and internationalization

of business standards such as the IFRS (International Financial Reporting
Standards), the ease with which we now travel, and increasing command of
foreign languages.
However, not everything can be unified, and rollout projects will always
require that the differences between the corporate system and the
solution to be implemented at a local subsidiary be distinguished. Two
major types of differences (or ‘gaps’) have been identified:
Legal gaps – country-specific legal regulations, particularly in the

financial, sales and HR areas (e.g. invoice correction in Poland vs.
correction note in Germany);
Local gaps – each subsidiary may have its own business processes in
place which are not included in the template (e.g. a unique production
process) or other specific requirements which are not a direct result of
legal regulations but are critical to the business (e.g. a special discount
system for a key client).
While legal gaps must simply be reflected in the system to enable correct
accounting, payments and reporting to country-specific authorities, the
other type of gaps – the different business processes – are treated
differently by different companies (e.g. the local business processes are
reflected in the system template or the processes are unified if possible).
Added to that is a whole plethora of differences that cannot be defined

but are serious enough to make the SAP rollout projects very challenging
and risky. An example of this are the differences in culture between
countries, even ones that are geographically close to one another. The
varying work ethics, perspectives, customs and language skills must also
be taken into consideration when planning a rollout.
Competencies and Experience
SNP Poland has carried out rollout projects in a few dozen countries across
four continents. Our company has supported rollout projects in most
European countries, as well as in the US, Indonesia, Egypt and Nigeria.
Due to being a part of the SNP Group, most of our projects have been
system transfers between subsidiaries of Polish companies, that is,
transfers between the headquarters abroad into Poland and vice versa.
Our ‘giving’ and ‘receiving’ clients include BASF, Mercury Engineering,
Hochland, Ferrero, Schneider, Antalis and Berker.
SNP Poland often acts as a partner to Polish companies responsible for

system startups in its foreign subsidiaries. In some areas (mainly finance), it
is good practice to make use of local specialists who are familiar with the
legal system of their country. Furthermore, each project is a good
opportunity to gain new experience, allowing us to carry out new projects
(such as those in Romania and Bulgaria) without the need for local support.
For the past few years, SNP Poland has also acted as a partner for a few
firms in their rollout projects conducted from their German headquarters
to other countries, including the US, Serbia, Finland and Estonia. For a
Poland-based company, cooperating with such partners as Wirthwein or
Rehau is not just a testimony to our high qualifications or an ultimate test
of experience, but also proof of the trust that these foreign businesses
have put in us following successful cooperation on earlier projects.
We have supported SAP rollout projects in countries like:

▪ Austria ▪ Belarus ▪ Belgium ▪ Brazil ▪ Bulgaria ▪ Croatia ▪ Czech
Republic ▪ Egypt ▪ Estonia ▪ Finland ▪ Germany ▪ Greece ▪ Hungary ▪
Indonesia ▪ Ireland ▪ Italy ▪ Latvia ▪ Lithuania ▪ The Netherlands ▪
Nigeria ▪ Poland ▪ Romania ▪ Russia ▪ Serbia ▪ Slovakia ▪ Ukraine ▪
USA
Legal Gaps
One SAP area affected by the largest number of differences between

varying national legal systems is finance (SAP FI).
When transferring to Poland, particular attention must be paid to the VAT.

The concept of a VAT payment date is foreign to other legal systems. In
Western European countries, the VAT payment date is linked to the date of
the document. This issue is quite complex and SAP consultants from
corporate headquarters do not even attempt to understand it – instead

they leave it to the Polish specialists.
Another distinctive feature of the Polish system is ‘invoice correction’ – a

document unknown to other countries where, if need be, a new invoice is
issued. The role of a Polish SAP FI specialist is vital here.
It Is Not Only That Poland Has Legal Quirks
The legal and taxation systems of countries such as Russia or Belarus are
far more complex, featuring distinctive types of taxes and ways of
calculating them (such as the real estate tax and amortization). Contact
between businesses and state authorities is highly formalized and
requirements are very strict. For example, in Russia and Belarus, the law
specifies what the layout of invoices, orders, reports and other required
documents should look like.
In Russian accounting, there exists the so-called red-ink correction system

(a system for correcting financial documents; this entry is usually made in
red). The ever-changing legal regulations in Russia (registers of VAT, sales,
depreciation of fixed assets, rules for reporting to authorities, etc.) pose a
further challenge.
These large and small country-specific solutions make SAP projects in

Russia substantially risky. This is why the SAP FI module for Russia is, for
the most part, completely different from SAP FI modules for the rest of the
world – it contains more extensions and additional programs to account
for the legal differences. Additionally, in its standard version, it offers a

large number of predefined ready-to-print documents in Adobe Forms
(e.g. invoices, tax return forms, reports for authorities, etc.). However, not
all documents are defined.
Maciej Gerke, Project Manager at SNP Poland: “I regard the complexity of

the Russian tax system in the context of SAP implementation as very high,
and the requirements imposed by various authorities and institutions may
surprise everybody. The number of documents required by law is
enormous, and they are very complex. The unique types of charges and
taxes, and the extremely detailed requirements that regulate financial
reporting, significantly complicate system configuration. This translates to
a higher risk and bigger budget for SAP FI rollouts. We have similar
experiences from our project in Belarus. Therefore, if planning a rollout in
Russia or Belarus, one ought to seek support of an experienced partner,
such as SNP”.
In addition to finances, another issue to consider in Russia is the custom

identification number (GTD). It is mandatory to have this number, and a
lack of it or mistakes in documentation may cause serious problems at the
border, both in export and import situations.
Let us move on to the US now – its financial law and taxation system differ
completely from their European counterparts. Beata Niemiec-Siwek,
Project Manager at SNP Poland, says this about her experiences with
Wirthwein: “The SAP FI rollout project from the German headquarters to a
plant in North Carolina required the introduction of a time-dependent
taxation policy and a reflection of the differences in calculating tax

between the state, county and metropolitan jurisdictions. Moreover, in the
US there is no VAT; instead, there is the Sales and Use Tax, calculated
according to completely different rules. Having learnt these rules, the next
challenge was to transfer the knowledge we had gained to the
headquarters in Germany and translate it into a system configuration”.
Another example of country-specific legal solutions are the laws regulating

the ‘special goods’, such as alcohol and tobacco (e.g. excise duty, special
tax, etc.). These needed to be taken into account during corporate SAP
rollouts for the Heineken corporation in countries like Bulgaria and
Romania.
The business maturity of Western European countries and the US

means that more trust is given to the business partner. Oral
arrangements are as important as written ones.
Business Processes – The Same But Different
Although legal regulations in particular countries greatly differ, they are

paradoxically the easiest to implement during the rollout. Beata Niemiec-
Siwek says: “The law imposes various solutions and local versions of the
system give us the tools to implement them. This needs no further
consideration. The effect we want to achieve is known from the start, and
the financial and accounting departments can check at any time if the
configuration is appropriate or not. Here, an excellent knowledge of law

and business – and experience – is required. However, the priority in the
basic SAP FI functionality, i.e. accounting and financial reporting, is the
correctness of tax settlements”.
The situation is quite different in logistics, production and sales, where

there may be many significant differences between business processes
applied in subsidiaries in various countries when compared with the
strategy of the headquarters (either reflecting local specificity in the system
or unifying the process).
A good case in point is purchases. If this process is not centralized within

the corporation, then each local branch will carry it out in a slightly
different way. A similar issue lies in determining the final price for the
client. This is a result of using various discounting policies for clients or
suppliers, calculating the profit margin, using cash payment discounts,
mark-ups, special discounts for key clients, etc.
Beata Niemiec-Siwek says: “German companies like to both grant and

obtain cash payment discounts. In Poland, until recently, the unfavorable
interpretation of regulations prevented a widespread practice of this
discount method. When rolling out the SAP system from the German
headquarters of one of our clients to Poland, we developed a solution that
enabled cash discounts for payments made on time. Not only is this
solution compliant with Polish law, but it was also developed as part of the
SAP ECC 6.0 standard. UK companies also use country-specific discount
practices. Their identification and determination as to whether they can be

used in other subsidiaries is a stage in rollout concept development”.
Production processes are another business practice that may differ from
plant to plant within a corporation. “Two production facilities of one of our
clients produce oil. One plant is located in Poland, the other in the UK. The
final product is the same, as are the production process and the formula.
The only difference is the method of determining the best-before date. It
is recorded in different formats and in different stages of the process. This
seems like a minor detail, but we had to take it into account during
process configuration”, says Beata Niemiec-Siwek.
Such examples are abundant in logistics processes. A standard element of

the Go Forward rollout methodology within projects carried out by SNP is
the Fit & Gap analysis. It aims to identify legal differences as well as
differences in business processes between the corporate SAP template
and the needs of a local subsidiary. The analysis covers all areas of the
system to be implemented at the local subsidiary.
Communication is More Than Language
The most common language of communication in business and IT

ventures is English (or occasionally German). It may happen that the
project participants’ language skills – particularly in the client’s working
groups – are insufficient.
“During the rollout in Nigeria, we met with system users at the client’s
plant in Lagos. The differences in the command of English between the
participants was one thing, but their accent was quite another. Nigeria has
around 250 ethnic groups speaking various languages. Our Nigerian
colleagues’ English was sometimes hard to understand due to the
differences in pronunciation and accent. Incidentally, we had similar
problems in one project with a Scottish colleague. We had to ask him to
repeat a sentence on numerous occasions as his Scottish accent was very
difficult for us to understand. Luckily, we have email, and besides this,
business language and SAP language are universal enough to be
understood in every corner of the world”, Maciej Gerke adds.
SNP’s rollout methodology quite specifically details the rules of

documenting work progress. However, our day-to-day approach to this
issue is quite pragmatic.
In IT projects, a large part of the communication is formalized in project

documentation: the project description and rules, the concept, the test
scenarios, the schedule, the risk register, the list of open subjects, the
activity report, minutes from meetings… there are quite a lot of
documents.
Maciej Gerke says “SNP’s rollout method quite specifically details the rules
of documenting work progress. Nobody likes paperwork, but it can be
useful because the projects can take a few months to complete and can
involve as many as a few dozen people – human memory has its
limitations. However, our day-to-day approach to this issue is quite
pragmatic. We have many ready templates in place, we communicate

through SharePoint and make sure that the documentation is useful and
not a burden”.
SNP’s project managers agree that the level of project formalization often
depends on the country in which (or from which) the rollout is carried out.
Beata Niemiec-Siwek summarizes this: “The business maturity of Western
European countries and the US means that more trust is given to the
business partner. Oral arrangements are as important as written ones.
Unforeseen difficulties that may affect the schedule, for instance, are
communicated openly, which causes both parties to seek a solution.
However, things are different in Eastern Europe and Russia – in those
areas, all arrangements must be confirmed in writing”.
Practical-minded Americans have a different approach than Europeans to

role and responsibility allocation within a project; the consultant – a system
specialist – largely decides on the final shape of the solution. This high
degree of trust (if the consulting company has appropriate competencies
and experience) translates into a lower workload for the client’s
employees.
Every country has its customs
Egypt:
Bilingual sales invoices – in English and in Arabic
Sunday is a normal working day
Poland:
Invoice correction (a document not used in other countries)

VAT payment date
US:
Sales and Use Tax (no VAT)
Tax system depends on jurisdiction (state tax, county tax, metropolitan
tax)
Germany:
Correction note
Indonesia:
Tax on the sale of luxury goods (a distinctive version of excise duty),

applied to goods such as beer
For each sale, the company must issue two documents – an invoice for
the client and a tax invoice for the tax authorities
Bulgaria:
A local solution for the VAT register, separate tables for storing data,
special reports
Nodding one’s head up and down to show disagreement

Excise duty is not settled periodically but with each shipment of goods
Russia:
Payment reason – each payment by remittance must contain a verbal

reason for the payment – the supplier’s invoice number is insufficient
Specific taxes (e.g. tax on real estate)

Legally defined layout of financial documents (e.g. invoices)
Red-ink entry
Obligatory custom identification number (GTD)
Communication is more than language. Certain customs, practices and
ways of doing business may seem so obvious that we forget that an
outsider may misunderstand them or not understand them at all. Beata
Niemiec-Siwek experienced this when she made an appointment with
Wirthwein’s project team. “The meeting was to take all day, from the
morning. For us, the Polish, this meant 9 a.m., whereas our American
colleagues were ready at 7 a.m., which is when they usually begin their
working day. Such misunderstandings do take place and are usually a
subject of jokes”.
Maciej Gerke points to yet another aspect of communication: “In Nigeria, I

was touched by the openness and enthusiasm of my client’s employees.
Competencies are a key requirement, but where people are eager to work
(and to understand why they are doing it), and when personal gains in the
form of new competencies are noticed, work is easier and more effective.
Their zeal was contagious”
A Rollout – Just a Project?
The SAP system is universally met with approval – it can be successfully

launched and used in virtually every country. A great aid in rolling out
corporate solutions in any country is the Globalization Knowledge
Database, made available by SAP, which lists notes describing the
differences in local solutions, annotations and aids.
Maciej Gerke says: “The Globalization Knowledge Database is a great aid

in rollout projects – in many cases, it is a good guide for functionality
configuration. However, without business knowledge, project experience
and understanding of different realities, a solution cannot be tested and
corrected. SNP’s experience gained in more than a hundred rollout
projects is to our advantage. With or without the cooperation of a local
consultant, we have the competence to transfer SAP from the
headquarters in any location to virtually any country in the world”.
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10/22/23, 10:31 PM SAP Rollouts: Global Economy, Local Requirements | All for One Poland

SAP ROLLOUTS: GLOBAL ECONOMY, LOCAL

Different Countries, Different Customs

Author: Mirosława Huk

increasingly coherent legal system in EU countries and within other D ATA B A S E

international organizations, business globalization and internationalization

Legal gaps – country-specific legal regulations, particularly in the

Added to that is a whole plethora of differences that cannot be defined

Competencies and Experience

SNP Poland often acts as a partner to Polish companies responsible for

We have supported SAP rollout projects in countries like:

One SAP area affected by the largest number of differences between

When transferring to Poland, particular attention must be paid to the VAT.

corporate headquarters do not even attempt to understand it – instead

Another distinctive feature of the Polish system is ‘invoice correction’ – a

It Is Not Only That Poland Has Legal Quirks

In Russian accounting, there exists the so-called red-ink correction system

These large and small country-specific solutions make SAP projects in

for the legal differences. Additionally, in its standard version, it offers a

Maciej Gerke, Project Manager at SNP Poland: “I regard the complexity of

In addition to finances, another issue to consider in Russia is the custom

taxation policy and a reflection of the differences in calculating tax

Another example of country-specific legal solutions are the laws regulating

The business maturity of Western European countries and the US

Business Processes – The Same But Different

Although legal regulations in particular countries greatly differ, they are

configuration is appropriate or not. Here, an excellent knowledge of law

The situation is quite different in logistics, production and sales, where

A good case in point is purchases. If this process is not centralized within

Beata Niemiec-Siwek says: “German companies like to both grant and

practices. Their identification and determination as to whether they can be

Such examples are abundant in logistics processes. A standard element of

Communication is More Than Language

The most common language of communication in business and IT

SNP’s rollout methodology quite specifically details the rules of

In IT projects, a large part of the communication is formalized in project

pragmatic. We have many ready templates in place, we communicate

Practical-minded Americans have a different approach than Europeans to

Every country has its customs

Invoice correction (a document not used in other countries)

Tax on the sale of luxury goods (a distinctive version of excise duty),

Nodding one’s head up and down to show disagreement

Payment reason – each payment by remittance must contain a verbal

Specific taxes (e.g. tax on real estate)

Maciej Gerke points to yet another aspect of communication: “In Nigeria, I

A Rollout – Just a Project?

The SAP system is universally met with approval – it can be successfully

Maciej Gerke says: “The Globalization Knowledge Database is a great aid

A_Z OFFER OFFER ABOUT US

+48 61 827 70 00 Webinars

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