SAP ERP

Operations: Cross Functions -- Project and Portfolio Management

The following business goals and objectives can be achieved through the implementation of these processes:

Reducing Operating Costs & Increasing Efficiency

•   Lower logistics costs

•   Reduce administration, improve business processes

Portfolio Management supports the management and controlling of projects and programs to achieve strategic business objectives. It is the central tool to support the decision making process across different business areas or activities like capital management, professional services, new product development and introduction (NPDI), or IT projects.

Portfolio Planning

Portfolio Planning is a high-level planning process based on your company’s strategy. The new and existing initiatives, projects and proposals are identified, evaluated, prioritized and selected based upon the overall business objectives.

• Portfolio Overview:  Gain transparency about all the initiatives, projects, proposals etc. in your portfolio by using dashboards. Review the key indicators such as budget, schedule, staffing, and net present value (NPV) across the entire portfolio.
• Portfolio Alignment: Bring your portfolio in line with corporate objectives. Direct resources and budget to key corporate performance objectives by funding or staffing only those initiatives that score high against these priorities. Compare quantitative and qualitative metrics in evaluation models and display projects, proposals, and baseline services in ranked lists based on one or more scoring models; plot results to clearly identify initiatives that look most promising.
• Financial and Capacity Planning:  Use granular financial planning measures to display and monitor costs and benefits along a time axis across different cost and benefit elements, comparing estimated values against baseline plan, forecast, and actual values. Eliminate the complexity and inefficiencies associated with spreadsheets by rolling plans from the bottom up and distributing resources and budget from the top down, across the different entities that encompass your organization.
• Enhanced Visibility: Identify long-range resource demand, which enables you to estimate prospective headcount, measure it against your available resources, identify potential bottlenecks or shortfalls, and transform your workforce to meet the needs of the future. 
  Integration: Direct integration with SAP ERP Financials and SAP ERP HR can be used to ensure data consistency between long-term and operational planning.

Portfolio Monitoring

Portfolio Monitoring ensures alignment of the portfolio with the overall strategic objectives. Predefined performance indicators are reviewed by decision makers and stakeholders in regular review meetings.

• Portfolio Performance: Leverages data from underlying software systems (including project management, idea management, HR, and financials) and incorporates the information in a portfolio cockpit that provides a clear overview of status, resourcing, work or revenue pipeline, and planned versus actual costs.  Transparency of the overall performance of the portfolio is gained by predefined performance indicators enabling comparison of the portfolio elements.
• Resource Utilization: Leverage reliable resource data including employee availability and qualifications by integrating employee data directly from your HR software (SAP or non-SAP). Compare the available and the required resources to identify upcoming resource bottlenecks.

Process Management

Process Management or Decision Flow Management (DFM) enables you to control and monitor the information and activities across multiple stages of product and service development and innovation projects, for example. Managers can link different types of activities (e.g. concepts, product proposals, projects etc. ) and therefore be able to manage these activities in the context of a global initiative for a new product development. Given this, DFM delivers functionality to implement global decisions to sub-projects (top-down) as well as consolidating status and KPI information (bottom-up) from it's underlying sub projects / sub-items.

• Decision Points: Innovative process management based on phase / gate methodology – decision points and multiple phases. Decision Points can have a planned, forecasted and actual date and duration. The process which the item and/or initiative follows, and the decision point criteria that have to be passed, can be determined via template or type. This allows a comparable process with a complete overview on the process with all phases and decision gates planned for an initiative.
• Planning: Financial and Capacity planning capabilities for initiatives, including all of it’s projects / portfolio items, can be rolled up from the item level. It is possible to create metrics and KPIs to meet business needs. You can monitor the trends of the KPIs during the lifecycle of item and initiative and define thresholds for alerts.
• Gates and Approvals: Top-down and bottom-up scheduling for initiatives and its objects. Synchronized Decision points and project phases allow optimal process control. Support of phase reviews and portfolio reviews with workflow based approval process.
• Integration: Benefit from integration with ERP, PLM objects (Materials, BOM, Production Plans, QM), Document Management, and the centralized maintenance of roles, authorizations, categories, and organization structures.

Configuration Variants

Through the efficient management of projects it is possible to distribute work among team members and track the progress of the work/tasks in milestones. Project Management is a common business practice used in various industries for different types of work that needs to be finished in a certain timeframe.

Project Planning

Successful project planning enables you to plan, manage, and control the entire project development process, from initial idea to completion. The solution allows project managers to control project structures, schedules, costs, and resources. This includes network planning techniques and aggregative tools that support cross-project cost, revenue, margin, schedule, and resource management. The Project Builder lets you set up a project and monitor its progress. The project planning board simplifies project planning and control, combining tabular and graphical data to provide a global overview. The information system gives you a detailed picture of current status, which you can represent using a variety of reporting tools.

• Project Structuring: The central structures in the SAP Project System (PS) are work breakdown structures (WBS) and networks, with their attendant activities and milestones. With cProjects you can structure a project using phases, tasks, checklists, and checklist items. Use versions to simulate project changes or take snap-shots of the actual project data.
• Document Management: Project System is fully integrated with SAP Document Management Systems (DMS). Assigning documents is supported by all DMS functions (e.g. versioning and vaulting). You can view the originals of assigned document masters and maintain them directly in the Project Builder. You can search for project documents using various search engines and publish them for external access on the Internet. In addition, cProjects supports a built-in document repository and allows document collaboration via cFolders.
• Costs: You can plan costs entering overall values for WBS elements or for example using Detailed Planning or Easy Cost Planning. You can also make use of the network calculation of internal and external work, services, and procurement planned in activities that are automatically calculated. A project in cProjects can be mapped to internal orders or WBS elements to plan costs based on resource staffings and cost rates.
  Revenues: The billing plan is either automatically updated by the sales order or planned manually in the project and includes dates on which payment requests or invoices affecting sales are sent to customers. Milestones can be used to trigger the billing procedure. You can also benefit from sales pricing and resource-related billing.
• Budget: Budget availability controls all expenditures during the execution phase. For projects budget can be distributed top-down to individual WBS elements. Additionally, the original budget can be broken down into smaller packages of released budgets to allow an even more accurate availability control.
• Scheduling Functions: The system calculates the dates for an entire project or a portion of the project with all associated project objects when you select the scheduling function. Scheduling is carried out forwards and backwards according to the relationships between activities. Constraints are taken into account, earliest and latest dates are calculated, and floats are determined. cProjects supports both bottom-up and top-down scheduling. Use a Gantt chart to analyze or change dates.

Project Execution

Task fulfillment is critical to successful project execution. It is necessary to not only track the completion of the task, but also the time used and the role that executed the task.

• Confirmation: Enables you to confirm actual time and costs for your project. The times you enter become the actual times and costs for the project. Amongst others the Cross Application Time Sheet (CATS) can be used to confirm times for network or cProjects activities. Full change and cancellation handling are also provided.
• Project-Oriented Procurement/Production: The procurement of external resources and services can be triggered in projects using network activities or Executions Services of Easy Cost Planning. Using the assignment of material components to network activities, you determine the assemblies and raw materials that must be reserved or ordered for a project and trigger procurement using MRP or purchasing. Apart from manual assignment options you can assign material also using the BOM-PS, the Open Catalog, or IPPE interface. Project-oriented procurement information from, for example, project system, purchasing, production or inventory management can be accessed and processed together. cProjects supports resource and material procurement via SAP SRM.
• Claim Management: Processes any project-relevant information such as variances or claims from third parties. Additional costs that might incur because of claims can be estimated in claim management and integrated in project cost planning.
• Payments: During execution, payment of relevant postings - through integration of other SAP solutions - feeds project cash management and provides the most accurate information possible on incoming and outgoing payments.
• Project Progress: Progress analysis/earned-value analysis is the tool to determine planned and actual project progress values. It obtains information on the state of projects and how they are developing. Using the Progress Analysis Workbench you can update progress data of multiple project objects simultaneously in one screen and benefit from import/export to Microsoft Excel. Milestone trend analysis displays the dates of the relevant milestones in a project at different report dates.
• Progress Tracking: Enables you to closely monitor the progress of WBS elements, network activities or material components in the project system and purchase orders in materials management.
• Phase Approvals: Protect phase approvals in cProjects by a structured approval process including decision makers named by the project manager and digitally signed approval documents.
• Project Reporting: The Project Information System is a flexible, comprehensive information system you can use to monitor and control your project data. You can evaluate individual projects, partial projects, or multiple projects. It includes overview reports and reports offering various degrees of detail. It is designed to meet the needs of both project management and ordinary project personnel. Predefined InfoCubes are available for the SAP Business Information Warehouse from PS and cProjects. In addition cProjects supports built-in evaluations, flexible threshold values and dashboards.

Project Accounting

Project Accounting is an important cornerstone in project management. Through the management of costs in a project, you are able track and trace the budget you are consuming. It also allows for better visibility and forecasts if properly done.

• Project Costing and Budgeting: Benefit from cost planning in various degrees of detail. Automatic cost calculation can be used based on prices and quantity structures. From cProjects use Easy Cost Planning to create costing based on the current project plan. Based on the planned costs you can use the sales pricing to calculate the sales price for a product or service and create quotations. Use funds management by means of hierarchical budget allocations. Availability control enables you to control costs actively by issuing warnings and error messages when costs are incurred.
• Revenues: Use manual revenue planning or automatic update of revenue plan values from project system or sales document billing plans. Milestone dates can be used to update dates in billing plans automatically and trigger the billing procedure. With resource-related billing you can create billing request for work done, materials used, and other costs incurred in customer projects. Easy Cost Planning can be used to plan revenues based on cProjects data.
• Integrated Planning and Tracking: Detailed integration brings SAP ERP Financials capabilities to the project world, including budgeting, cost planning, cash management and actual costs confirmations and commitments from various sources such as Controlling, Financial Accounting, Production Planning and Control, or Materials Management.
• Settle Financial Data: Perform various allocations and period-end closing activities and finally, transfer costs and revenues to Financial Accounting (FI), Asset Accounting (AA), Profitability and Sales Analysis (CO-PA), or Controlling (CO) for example.

Configuration Variants

Define your overall resource demand based on your initiatives, projects, and proposals. The resources are assigned to work that has to be done in the project. Once the resources start working on the project time is confirmed.

Capacity Planning

Identify long-range resource demand, which enables you to estimate prospective headcount, measure it against your available resources, identify potential bottlenecks or shortfalls, and transform your workforce to meet the needs of the future. This long-term planning is then broken down into the operative demand which is generated by the underlying projects.

• Annual and Long Term Planning: Leverage reliable resource data from your HR system to base your long term planning on availability and qualifications.
• Capacity Monitoring: Plan and monitor the overall demand in your portfolio and compare it to the demand to identify potential bottlenecks.

Staffing

Assigning resources to work that has to be done in the project including resource search. After the project has been released this process covers time confirmation on projects.

• Resource Assignment: Assign internal and external resources to work that is planned in a project.
• Time Confirmation: Confirm the work to track the projects overall status and progress either in the projects directly or by using the Cross-Application Time Sheet (CATS).

Configuration Variants