The first step in any configuration is to decide what organization structures your enterprise requires. To help you decide, you can use the following best practice configuration models:
Model 1: A single operating company in one country
Model 2: A single operating company in multiple countries
Model 3: Multiple operating companies in one country
Model 4: Multiple operating companies in multiple countries
These models deal with integration points between the different applications and the requirements of different industries and geographies. They can help you choose the right organization structures to meet your management and reporting requirements.
The Configuration Workbench uses the models as templates to generate the organization framework of business groups, operating companies, legal entities, and employers for any enterprise. Through an interview process, the Configuration Workbench gathers the detailed information it requires to generate an actual configuration of your enterprise using the appropriate configuration model.
Mexico only: You cannot use the Configuration Workbench to create the hierarchy. You must use the Generic Hierarchy functionality.
The preceding diagram shows the basic configuration for a small or medium sized enterprise with little or no complexity in operating structures. Vision Corporation is the ultimate legal entity, and for reporting purposes, this organization holds any data associated with the enterprise. Every enterprise has one ultimate legal entity.
This simple enterprise structure is based on the best practice configuration model. Creating the key enterprise structures as separate organizations enables your enterprise to expand and acquire new companies whilst reducing the cost of re-implementation.
The preceding diagram shows a configuration for a medium or large enterprise with some international operations introducing a degree of complexity. It also shows that operations and people in some countries are held within an international business group (XZ). You can see that the business groups represent countries, and do not appear in the organization hierarchy. This is based on the best practice configuration model.
For more information on the key organization structures, see: Key Concepts for Representing Enterprises
The preceding diagram shows a configuration for a multi-company enterprise operating in a single country. This type of complexity can exist in any size of enterprise. Vision Lighting and Vision Security in the diagram are represented as operating companies. Every enterprise has at least one operating company. This may be a division, or a subsidiary within the enterprise which is legally registered in at least one country.
The Configuration Workbench creates at least one operating company organization as best practice. This reduces the cost of any re-implementation as a result of expansion due to acquisition or diversification within the enterprise.
The preceding diagram demonstrates a multi-company enterprise operating in multiple countries. Every enterprise has at least one legal entity that is the designated legal employer for all employment related activities. In the diagram, the Vision Security operating company operates and employs people in the U.S. and Ireland. The Vision Security U.S. and the Vision Security Ireland organizations represent the designated legal entities/employers in those countries.
The Configuration Workbench classifies an organization as a GRE/Legal Entity where your enterprise operates in a country, and classifies it as an Employer if you employ people in that country also. For example, you can have a legal entity in a country where you do business, but do not employ people in that country.
The preceding diagram shows an alternative configuration for a multi-national and multi-company enterprise with the addition of a consolidated legal entity. A consolidated legal entity acts on behalf of several operating companies or the enterprise, and is the legal employer in the country. Using the preceding diagram as an example, Vision Corp UK is the consolidated legal entity for Vision Corporation in the UK. For management reporting, VL UK and VS UK report to Vision Lighting, and for legal reporting, they report to Vision Corp UK.
For more information on the key organization structures, see: Key Concepts for Representing Enterprises