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“Business Group” in EBS

Lets talk about one of the basic concept of Oracle Application which is so called "Business Group" , part of Multi-org architecture. Understanding this is important for non HRMS consultant as in R12 Finance the new legal Entity architecture [1] is equally important.

Business Group in HRMS Shared Mode

A business group is a basically Human Resources organization to which you assign employees. You assign each operating unit to a business group in the financial options setup. You can assign the same business group to different operating units including to operating units in different financial sets of books. You can setup a separate business group for each operating unit if you want to segregate and maintain each group of employees separately. Oracle provides one setup business group you can use.

In case of not having HRMS (Full mode),what you have to do is ,to create at least one business group to cater requirement for Oracle Financials and Manufacturing, so that only the employees can perform some of application functionality , which are as follows:

There are few exceptions, where you have to understand when your installation site is having HR and Projects modules installed, as there are significant implications of business group and HR organizations.

Business Group is part of MultiOrg model of Organizations

The Multi-Org model provides a four level hierarchy that dictates how transactions flow through different business units and how those business units interact

  • Set of Books- GL- Balancing Entities/Funds
  • Business Group
  • Legal Entity -HR- Fin- Legislative Reporting
  • Balancing Entity
  • Operating Unit- AP, AR, PO, OE -Bal Segment 1, Bal Segment 2,Bal Segment 3
  • Inventory Org MFG, INV, Ship

There is one confusion between Oracle Financial and HRMS consultant, as they simply assume SOB is more meant for non HRMS module and BG is more for HRMS, in certain extend this is true.Lets investigate this on GRE\LE and OU as follows:

Know something more for SOB

Is SOB linked to HR module?

Yes,. Once SOB is created from GL setup part, this can be linked in HRMS by such navigation

Work structure => GL organization Description ==> Business Group

What is a Business Group/Legal Entity?

Operating Unit vs Business Group

Setup Business Group

As per standard User Documentation: A ’Setup’ Business Group is supplied with Oracle HRMS. This business group is used by the default responsibility. You can use this business group with all of its default definitions as the starting point for your own Business Group, or you can define other business groups to meet your own needs.

A business group enables you to group and manage data in accordance with the rules and reporting requirements of each country, and to control access to data.

The critical factors for deciding when to use a separate business group, or an international business group, are based on the following factors:

Generally the laws are so different in each country that to be compliant, there must be a different business group for each country in which an enterprise has employees.

BU in HRMS and other Integration

The need for cross functional integration cann't be denied as most of the base information is pulled from HRMS to Oracle Finance , Manufacturing as well as CRM Modules. A typical integration aspect with some of the core module can be best understood as figure below:

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2 Comments (Open | Close)

2 Comments To "“Business Group” in EBS"

#1 Comment By Oracle ERP Training On May 4, 2009 @ 2:04 am

Nice and precise article on Oracle Business Groups. Thanks!

#2 Comment By NP On August 4, 2010 @ 12:47 am


Will you please explain how to define international BG and have a hierachy with subordinate BGs to the same?