Most companies are juggling several projects at any point in time. These projects may vary in size and complexity,...
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from erecting and commissioning an entire manufacturing unit to a complete maintenance turnaround that shuts down the entire plant for maintenance purposes.
Often, these projects are managed and monitored using SAP Project System (PS), a module in R/3 and a component in SAP ERP Central Component (ECC).
It makes sense that project planners are aware of and are using the system's many planning features, be it scheduling, resources or materials planning, to take timely preventive or corrective actions when a project's planning begins to deviate from actuals.
Planning takes place at two levels, namely, the work breakdown structure (WBS) and network levels. A WBS element enables project managers to map the entire project structure in SAP ECC; for example, managers can list all the tasks and milestones of a project, the materials produced in-house for a project or the externally-procured materials, and even services procurement. A network maps the flow of a project as it links up various WBS elements or other networks through predecessor-successor relationships; for example, start-finish, start-start, finish-start, finish-finish and time-based interdependencies.
In any case, for an array of the projects your company is juggling, these five planning functions in the SAP Project Systems module (or component) can enable better logistics and financial controls.
Since effective scheduling is the foundation of any project, SAP Project Systems offers several options to monitor a project's dates and to automatically react to any scheduling updates.
The forecast dates form the baseline on which the project planning takes place. Any updates or changes to forecast dates are compared with basic dates, which reflect updated or revised planning dates. Further, the actual dates are automatically updated as soon as any relevant transaction takes place in the system. The actual date can be the date when a material was physically received in the warehouse or when the service provider completed the required service.
Maintaining dates in WBS elements and linking them with a network ensures that any changes made to any dates, whether planned or actual, automatically update all the interdependent dates.
Various levels of control for dates are available, such as top down or bottom up. In the first case, any changes made at the top level have a cascading effect on lower-level WBS elements and activities. With a bottom-up approach, changes made to dates at the lower level, such as at an individual WBS element's level, are reflected in the associated network.
Projects often involve using in-house resources, such as machines or manpower.
While scheduling in the SAP Project Systems module or component determines when the required product needs to be produced, it does not take into account whether the capacity required to produce a product is available or not.
Implementing Capacity Requirements Planning in PS not only provides complete visibility into the required and available machines' capacities, but also gives planners an opportunity to level a machine's capacity in case there's an overload.
A project's completion often requires that raw materials and assemblies be available at the right time and in the right quantities to ensure the project stays on track. Using the SAP Material Requirements Planning function for external procurement and internal production helps greatly.
Further, using the Availability Check function ensures that the planner is alerted as soon as there's a material or an assembly shortage that can negatively affect a project's progress.
If resource planning and materials planning are part of a network, then the system is automatically able to calculate the planned costs of procuring and consuming resources and material; this is known as networking costing.
It is also possible to perform manual cost planning at the WBS level, in case the purpose is to have a preliminary view of cost planning. Depending on the business need, either cost element or period cost planning is possible. If the financial planner wants to monitor cost at the cost element level (such as a cost center), then this is the preferred method. If the financial or project planner monitors costs on a periodic basis, such as monthly, then period cost planning is a better business fit.
In a make-to-order business scenario, especially those that entail large construction, fabrication or erection projects, the company only produces or assembles a product based on a customer's sales order.
The sales order data flows into the PS component and provides an option to mark specific WBS elements as revenue-relevant by treating them as billing elements. Doing so ensures that, as soon as relevant WBS' are marked as complete, the billing plan will automatically create partial invoices.
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