Skip to Content
Personal Insights
Author's profile photo Shubham Srivastava

Lessons Learnt – SAP Commercial Project Management Implementation

Hi Readers,

I would like to share some of the lessons learnt while implementing SAP Commercial Project Management module for Engineering & Construction industry customers. This blogpost includes some basic information about the product while the focus is more on the key lessons learnt.

Business Background

EC&O industry comprises of business segments like building & housing ,Infrastructure ,Power transmission and other construction projects

Service formats include EPC, General contracting ,Conventional contracting ,BOOT/PPP Concessions

Major process steps involved are :

  • Project Estimation (Costs / Resources /Quantities)
  • Project Creation
  • Project Scheduling
  • Project Cost planning
  • Project Budgeting
  • Project Progress monitoring & control
  • Project Reporting

Business Pain Areas

  • Lack of clarity on project resources , estimation & actual progress
  • Non availability of single source of truth for project progress ,costs ,actuals & KPIs
  • Integrating physical project progress with financial progress
  • KPI driven management reporting missing in current landscape
  • Integrating project issues & change requests with overall project progress
  • Financial planning in terms of resources ,costs ,revenues ,budgets & material quantities

High Level Process Flow – Solution Design

Solution Scope (SAP CPM)

Three pillars of CPM are as below :

  • Project Workspace
  • Integrated cost & revenue planning with commercial project life-cycle
  • Project Issue & Change Management with integrated financial planning

Additional installations for CPM

  • NWBC
  • SAP Analysis Office for planning workbooks

Lessons Learnt

Forecasting

  • Forecasting happens in CPM and CO version 0 is independently updated from the schedule
  • Forecasting is based on productivity (Manual /Automated)
  • New cost forecast is calculated (adjust ETC based on productivity)or based on current approved budget (adjust ETC and keep current approved budget the same)
  • Forecasting is done on need basis with monthly distribution of resources
  • Cost forecast is transferred to CO as part of month end closing & system calculates the new ETC based on actuals
  • Output based planning workbooks needs to be customized taking into account productivity norms & formulae for enabling streamline calculations
  • Service master can be integrated with workbooks through a minor development / customization (Writing a custom implementation class & linking to a new resource type say ZSERV i.e. service resource type)

Project Financial Planning (PFP)

  • Output based planning (monthly) workbooks can be used as a base & business specific workbooks can be developed using BWIP efforts
  • In this planning, Statistical Key Figures (SKF) are used to define output Quantity for a structure element and Input resource type and Resources are planned to achieve the planned output Qty.
  • SKF’s are used to calculate the percentage of completion based on plan and actual postings. For example, to Paint a Wall of 20 Square meter, one can define an SKF and the required materials and labor as required resources to achieve this output quantity. Actuals can then be posted on SKF and resources to track the progress of quantities based on consumption of resources.
  • For some resource types like Labor, Equipment ; productivity (Output Qty/ Input Qty) drives quantities. If a labor paints 10 sq.meters wall in 8 hrs, then productivity of the labor would 10 M2/8 Hr = 1.25M2/Hr. Similarly, one can also calculate other productivity related key figures like Productivity Factor, Earned Qty
  • Material & Service planning can be done by building custom workbooks. Rate card editor functionality of CPM can be utilized
  • PICM can be integrated with PFP so as to capture cost changes logged in the change request in the revised financial plan
  • Financial plan versions can be easily created within PFP

Project Workspace

  • Project progress can be monitored using Project overview workspace view
  • SD & MM integration with CPM can be appreciated by exploring Commercial & procurement views in workspace
  • Project risks & opportunities can be monitored in Risk Management view
  • Document collaboration can be found in document overview.
  • Project teams can be configured in Teams Overview
  • Use of extensive embedded analytics is one of the most promising feature of CPM

Project Issues & Change Management

  • Change is always initiated as Change request in CPM
  • User can make any changes in estimation tool for changes that require detailed estimate
  • Updated changes gets transferred to scheduling system with CR number to assess impact on dates & schedule
  • Entire budget is updated and transferred to CPM (Current budget) which get transferred to CO using CPM transfer strategies
  • CR outputs are captured in CPM (pdfs) and necessary approvals can be configured

With new innovations & additions in SAP Commercial project management as a product, customers across the globe are adopting it in their core business activities.

 

Thanks

 

Shubham

Assigned tags

      10 Comments
      You must be Logged on to comment or reply to a post.
      Author's profile photo Akash Khandelwal
      Akash Khandelwal

      Hi Shubham,

      Good Blog.

      I have one question , why SAP is not offering Service Master as Standard Resource type like Material, Activity type etc..as Service is majorly used in Construction Sector.

      Author's profile photo Shubham Srivastava
      Shubham Srivastava
      Blog Post Author

      This is for CPM in ECC - We can maintain resources within CPM as Services. Alternatively, we can use 0MAT and copy as ZSERV and map it to implementation class for services.This is minor ABAP effort.

      In S/4HANA , services do populate as Service materials.

      Ask the BWIP consultant to explore this program /CPD/PFP_CREATE_RES_MSTER_DATA. The Admin guide is quite useful in such scenarios.

      Author's profile photo Shayondev Sengupta
      Shayondev Sengupta

      Hi Shubham,

      Very informative blog.

      I would like to ask how important is the role of a BW-IP consultant in CPM implementation?? Is a dedicated BW-IP consultant required for CPM implementation?

      Thanks

      Shayondev

      Author's profile photo Shubham Srivastava
      Shubham Srivastava
      Blog Post Author

      A dedicated BWIP consultant is a must for any CPM implementation.

      Author's profile photo Inspire Project
      Inspire Project

      Can SAP CPM can be used for Projects Mfg. Does it add any value?

      An urgent question, does SAP CPM integrate with SAP IBP/ APO.

      Our requirement is to transfer Constraint Planned Orders Data to SAP CPM via PS.

      Is there any linkage??

      Where is the list of SAP CPM Programs like /RPM/CO_DOWNLOAD in case of PPM once I setup the links between PS and CPM.Does CPM offer any benefit in case of ETO or MTO scenario.

      Can Engineering change Management data be flown.

      Is SAP BPC a better tool than SAP IBP for SAP CPM Integration.

      Author's profile photo Shubham Srivastava
      Shubham Srivastava
      Blog Post Author

      SAP CPM integrate with SAP IBP/ APO – Not in Standard.

      Refer the admin guide of CPM in S/4HANA for list of programs.

      No integration of ECM with CPM in Standard.

      SAP BPC & SAP IBP have separate customer value adds and both do not integrate with CPM in standard.

      Some useful links : https://blogs.sap.com/2013/12/11/are-you-using-sap-commercial-project-management-for-engineer-to-order-proposals/

      https://solutionexplorer.sap.com/solexp/ui#!/vlm/default/vlm-default-lob~~.~~92,bpr-default-254,e2e-default-287

       

      Author's profile photo Naveen Chawla
      Naveen Chawla

      Hi Shubham – thanks for the blog, its really helpful. I have a query related to forecasting, I am wondering, once in-period forecasting has been executed shouldn’t system be creating a snapshot version of the forecast month and move on to next month? I am working in S/4 HANA 1909 version right now, and system is not creating snapshots for in-period forecasting, however the configuration is in place and if I am doing period end forecasting, system does create a snapshot. But, once period end forecasting is completed, I can’t switch back to in-period forecasting. Thanks in advance for your response and clarification.

      Thanks

      Naveen

      Author's profile photo Shubham Srivastava
      Shubham Srivastava
      Blog Post Author

      You can post a question with relevant information in the community and accordingly experts can provide the right comments.

      Author's profile photo Saurabh Sharma
      Saurabh Sharma

      Hi shubham ,

      My material Master Data is not showing  at the AO work book Level , i had already run the standard program but not find the material master at th AO work book level , please let me know how i can resolve the issue.

       

      Thanks

      Author's profile photo Shubham Srivastava
      Shubham Srivastava
      Blog Post Author

      Ask the BWIP consultant to check the Info-cubes as /CPD/MATNR characteristic contains material master data which should flow in workbooks. Also, check if the implementation classes are correctly mapped in material resource type configuration. If this does not resolve, then you may raise an incident with SAP Support.