To fully integrate SAP Integration Planning Cycle ,ABC into the corporate planning cycle, several new customizing activities should be performed.In order to identify ABC costs in the cost component view of product cost, new cost components for processes may be needed.New value fields may be needed for processes in CO-PA based on the new cost components.New value fields may be needed for processes in CO-PA which are not product related.
Planning Integration - Sales Planning
In the Sales Information System (SIS) component of the Logistics Information System (LIS), the company can plan sales quantities for the following year. Similarly, sales quantity planning can be accomplished in profitability analysis (CO-PA). Both SIS and CO-PA can produce forecasts of sales quantities at the product or product group level. The two sales plans can be reconciled to produce a single consistent “master” sales quantity plan.
CO-PA: Planning
Planning layouts are customized screens for entering plan data. The definition of a planning layout controls not only the appearance of the pla nning screen, but also some of the functionality. This allows for complete flexibility in controlling the planning entry process.A planning layout definition consists of three parts: the general data selection, the lead columns, and the value columns. The general data selection is where characteristic values are specified that are valid for the entire layout. The lead columns are where additional characteristics that are to be planned may be specified. And the value columns contain characteristic/value fie ld combinations.
Valid values for the special characteristics version, record type (for costing-based CO-PA), and plan/actual indicator, are required for each row/column intersection in a planning layout definition. By employing these intelligently in the layout design, layouts can be created in which values can be planned for more than one version at a time and in which actual history data may be displayed for reference.
Variables may be used when defining planning layouts to give them maximum flexibility. Variables can be used for any characteristic, and they can be installed anywhere they are necessary: rows, columns, or the general data selection. Users will be prompted to enter values for these variables when planning.Separate planning layouts are necessary for costing-based CO-PA and account-based CO-PA, as planning figures on the two sides of CO-PA are not related or linked in any way. When defining layouts in costing-based CO-PA, the characteristic record type is necessary. When defining layouts in account-based CO-PA, the characteristic cost element is mandatory.
Planning in PP
In the Sales Information System (SIS) component of the Logistics Information System (LIS), the company can plan sales quantities for the following year. Similarly, sales quantity planning can be accomplished in profitability analysis (CO-PA). Both SIS and CO-PA can produce forecasts of sales quantities at the product or product group level. The two sales plans can be reconciled to produce a single consistent “master” sales quantity pla n.The sales quantity plan is transferred to Sales and Operation Planning (SOP) in Production Planning.There, a capacity-based comparison of plan quantities with production resources takes place. If the plan cannot be met, additional resources must be obtained or the sales plan changed.
Cost Center Planning
In the Sales Information System (SIS) component of the Logistics Information System (LIS), the company can plan sales quantities for the following year. Similarly, sales quantity planning can be accomplished in profitability analysis (CO-PA). Both SIS and CO-PA can produce forecasts of sales quantities at the product or product group level. The two sales plans can be reconciled to produce a single consistent “master” sales quantity plan.
The sales quantity plan is transferred to Sales and Operation Planning (SOP) in Production Planning. There, a capacity-based comparison of plan quantities with production resources takes place. If the plan cannot be met, additional resources must be obtained or the sales plan changed.The activity requirements are calculated in Production Planning and transferred as scheduled activities to cost center planning.
Transferring Plan Values to Cost Centers
Integrated planning supports transfers of data from Cost Center Accounting feeder systems to cost center planning.If you planned this data in the feeder systems and want to transfer it unchanged to cost center planning, you do not have to plan the corresponding data in Cost Center Accounting. To use integrated planning, you must meet various preconditions in Cost Center Accounting and in the feeder systems. For example, if you wish to transfer statistical key figure planned values, you must first have created the necessary statistical key figure master records, and linked them to the Logistics Information System (LIS).
The personnel costs that you planned in Human Resources (HR) can be transferred to relevant cost centers. During integrated planning between Cost Center Accounting (CO-OM-CCA) and Personnel Planning (PD), you can plan personnel costs for target wages, payroll results, or basic pay, and transfer these costs to Cost Center Accounting. A precondition is that the cost centers to which the affected personnel master data is assigned must be valid. If Personnel Cost Planning and Cost Center Accounting are implemented in systems at Release 4.6A or later, the system automatically transfers the personnel costs to Cost Center Accounting. In prior Releases, the user initiates the data transfer.
During integrated planning between the Cost Center Accounting (CO-OM-CCA) and Asset Management (FI-AA) components, you can transfer periodic depreciation and interest of an asset to primary cost planning in Cost Center Accounting.After you calculate the values for services required in SOP, Long-Term Planning (LTP), or MRP,you can transfer these figures as scheduled activity type quantities to Cost Center Accounting.
Planning Scope on Internal Orders
Cost planning is performed mostly on orders with long durations. Orders which only exist for a very short period, such as orders for unexpected small repairs, are usually not planned.Internal order planning provides three different levels of cost planning:
Overall Planning is the simplest way of planning costs for orders. You can estimate overall and annual values for an order independent from cost elements.When more detailed information is available for an internal order, you can use primary and secondary cost and revenue planning. This covers the planning of primary costs, activity inputs and revenues in manual planning. In automatic planning, you can charge the order with overheads, distribution costs, periodic reposting costs, assessment costs, indirect activity allocation costs, process costs, and settlement costs. If the order is a plan-integrated order, you perform a plan credit using periodic reposting or settlement to a cost center.
If you have access to more information on sources of supply, quantities and prices, you can perform unit costing. With unit costing you can plan on a level below the cost element level.You can plan statistical key figures as a basis for allocations and as a means to calculate the management key figures for your orders.
In integrated planning for internal orders, you can integrate cost element and activity input planning for an internal order with cost center or business process planning. This integrated planning capability is activated in the plan version. When planning activity inputs to integrated internal orders, the scheduled activities post to the sender cost center/process. In addition, plan settlement and periodic repostings of integrated orders to cost centers/processes is allowed. And plan allocations of indirect activities, assessments, and distributions from cost centers/processes to plan integrated orders are also allowed.
Planning Integration - Product Cost Planning
In the Sales Information System (SIS) component of the Logistics Information System (LIS), the company can plan sales quantities for the following year. Similarly, sales quantity planning can be accomplished in profitability analysis (CO-PA). Both SIS and CO-PA can produce forecasts of sales quantities at the product or product group level. The two sales plans can be reconciled to produce a single consistent “master” sales quantity plan.
The sales quantity plan is transferred to Sales and Operation Planning (SOP) in Production Planning. There, a capacity-based comparison of plan quantities with production resources takes place. If the plan cannot be met, additional resources must be obtained or the sales plan changed.The activity requirements are calculated in Production Planning and transferred as scheduled activities to cost center planning.
In cost center planning, the plan activity quantities are created on the basis of scheduled quantities. Cost planning is performed for cost centers and internal orders, as well as additional activity planning for overhead cost controlling. Planned costs from the HR and AA components can be transferred to cost center planning. Plan activity prices are then calculated.The calculated plan activity prices go to Product Cost Planning, which estimates the production costs of the planned products with the use of bills of material and routings (quantity structures). Cost center planning data can be transferred to profit center planning.
Product Cost Planning: Overview
When you create a cost estimate with a quantity structure, you enter the costing variant, the material, the plant, and the lot size. The dates are proposed from the costing variant and determine the following:
Ÿthe period of validity of the cost estimate (costing date from/to)
Ÿthe selection date for the bill of material and routing (quantity structure date)
Ÿthe pricing date for the material components and activities (valuation date)
With the Transfer control indicator you specify that you either want to use an existing cost estimate for component materials, or create a new cost estimate.The system selects and values the quantity structure automatically.The costing results can be saved and displayed as an itemization, a cost element itemization, or a cost component split. The itemization shows detailed information on the origin of the costs, such as the quantities and prices of the materials and internal activities used.
The cost element itemization groups the individual costing items into cost elements. The cost elements group the costs according to how they were incurred. For materials, cost elements are determined through account determination; for activities, through the activity type master or through activity type planning; for processes, through the process master record.The cost component split groups the cost elements into cost components. When a multilevel structure is costed, the cost component split is rolled up so that the original identity of the costs is retained for analysis.You can analyze the results of the cost estimate directly or in the information system.
Update Sales Plan/CO-PA
In the Sales Information System (SIS) component of the Logistics Information System (LIS), the company can plan sales quantities for the following year. Similarly, sales quantity planning can be accomplished in profitability analysis (CO-PA). Both SIS and CO-PA can produce forecasts of sales quantities at the product or product group level. The two sales plans can be reconciled to produce a single consistent “master” sales quantity plan.
The sales quantity plan is transferred to Sales and Operation Planning (SOP) in Production Planning. There, a capacity-based comparison of plan quantities with production resources takes place. If the plan cannot be met, additional resources must be obtained or the sales plan changed.The activity requirements are calculated in Production Planning and transferred as scheduled activities to cost center planning.
In cost center planning, the plan activity quantities are created on the basis of scheduled quantities. Cost planning is performed for cost centers and internal orders, as well as additional activity planning for overhead cost controlling. Planned costs from the HR and AA components can be transferred to cost center planning. Plan activity prices are then calculated.The calculated plan activity prices go to Product Cost Planning, which estimates the production costs of the planned products with the use of bills of material and routings (quantity structures). Cost center planning data can be transferred to profit center planning.
Planned production costs are then transferred to profitability planning (CO-PA). These estimated costs are used in conjunction with the sales plan projected revenue to create a profitability plan. Based on the results of this profitability plan, adjustments may be made to the original sales plan, which would flow through the entire integrated planning process as another iteration. This cycle could be repeated until all aspects of the integrated plan are satisfactory.
Transfer of the Product Costing Results to CO-PA
The cost components from a product cost estimate can be used in Profitability Analysis for profit planning, and to value the plan/actual data of billing documents. This enables you to receive detailed information on the origin of your product costs in Profitability Analysis, and analyze your contribution margins.To transfer the product cost estimate, you assign the cost components containing the cost of goods manufactured, and sales and administration costs, to the corresponding value fields of an operating concern, and link these values with the quantity field ‘sales quantity'.
The calculated cost of goods sold is then compared with the forecast revenues, and planned profit margins can be calculated. If the result is unsatisfactory, the entire planning cycle can be repeated with different starting values.You make the necessary settings to transfer data from the cost estimate into Profitability Analysis in Customizing for Profitability Analysis.
Plan Integration in Profit Center Accounting
To make it possible to control and evaluate internal areas of responsibility effectively, you should limit profit center planning to those values which are measurable and can be influenced directly. The people in charge of the profit centers will only be able to use the planned data and targets if they can influence the costs, revenues and inventor ies in their area. Since the organizational structure and scope of your company's responsibility areas depends largely on individual factors, it is necessary to create as flexible and multidimensional a plan as possible.Profit center planning is an integral part of your overall company planning. Profit centers make the integrated character of company planning especially evident, since the plan data here is created principally in other applications, and can be supplemented or changed here. Profit center planning is a part of short-term corporate planning, and encompasses a span of one fiscal year. Short-term corporate planning generally consists of the following partial plans:
sales plan
Ÿmaster production schedule
Ÿcost plan
Ÿsales revenue plan
The planning process combines these individual planning areas into an integrated planning network. You can use different plan versions to reflect changes during the planning process, or different planning scenarios for the same time frame.The planning of profit centers is performed in two stages. First, plan data can be transferred online from the following applications: Cost Center Accounting, Internal Orders, Profitability Analysis, and Product Cost Planning. Second, planning can be carried out directly on profit centers.
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