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Author's profile photo Manjunadh Lolla

What is SAP S/4HANA EPPM? – Disambiguation & Overview

In the recent times, SAP EPPM has become a buzz word in the solutions for Program management and Project management. Often, many customers and colleagues ask me “What is EPPM?”. Some ask me if it is the “Next Generation PPM”. Some even ask me if PPM in S/4HANA is called EPPM. There has been a lot of confusion about what it is and what it encompasses. This blog post is to clarify the most common questions regarding on-premise version of SAP S/4HANA EPPM, its components, and provide an overview of solutions within that.

Let’s start with the acronym first. SAP EPPM stands for Enterprise Portfolio and Project Management. It is not a successor of just SAP PPM. It is an umbrella term for a set of solutions that help customers run Project-oriented processes in their companies.

The major components in on-premise version of SAP EPPM are the following.

  • SAP Project System
  • SAP Portfolio & Project Management
  • SAP Commercial Project Management
  • Enterprise Project Connection
  • SAP Innovation Management

Though the solutions are grouped under the common name of EPPM, the Product Hierarchy and Product documentation appear a bit different in SAP Help. From the license perspective, as of now (October 2020), Enterprise Project connection is part of the EPPM License, but not SAP Innovation Management. Yet, in principle, all the components listed above form the part of EPPM.

Now that there is a clarity about the solution components of EPPM, let us look into a brief overview of each of them. These solution components have been existing from quite some time. However, looking at each of these will give the purpose and specific challenges that each of these solutions address.

SAP Project System: It has been a core solution from SAP from the beginning that does not need any introduction or detailed explanation. Very robust, sturdy, and impeccable module that seamlessly integrates with many modules in S/4Core. In a nutshell, it serves Financial, Accounting, and Logistic needs of Project-oriented processes in all CAPEX, OPEX, and Revenue Project Scenarios. For example, you can have features like Budget Control, Project stock, Inter-company process, Settlements, Results Analysis etc. Capabilities like these distinguish PS from other solutions in EPPM.

SAP Portfolio & Project Management: There are a lot of consultants who have been working with this from the times when it was two separate modules namely ‘Development Projects’ and “Resource & Portfolio Management’. That is why you still see all the important database tables start with “DPR” – indicating Development Projects. Eventually, it became a single product from PPM5.0 in ECC. Earlier, SAP PPM could stand alone in a system separated from ECC. From S/4HANA 1709, the latest PPM application has been part of the S/4Core. The distinctive features of SAP PPM are

  • Decision-Making capabilities using Portfolio Management by quantifying the qualitative information.
  • Light-weight Project Management suitable for running Projects with Professional Resources
  • Resource Management of Professional Resources.

However, there are no organizational elements like Controlling Area, Company code etc in SAP PPM. Also, there are no account assignment objects here. For example, you cannot account a Purchase order directly to a PPM Phase or a Task like you may do with PS WBS element or PS Network Activity. So, it must be routed through SAP PS. This process of linking PPM to PS is called Account Integration.

SAP Commercial Project Management: The journey of SAP CPM starts in 2012. CPM has Master Projects which can be linked one or more SAP PS Projects, accounting object like Sales Orders, and even non-accounting objects like SAP PPM Projects. CPM has 3 major components, namely, Project Workspace, Financial Planning, Project Issue and Change Management.

Project Workspace consolidates information from multiple areas like “General Overview”, “Procurement Overview”, Commercial Overview”. It works like a Project cockpit to navigate to Financial Plans, Risks, Issues, and Change Management.

Financial Planning in CPM is like Unit Costing in SAP PS but with a flexible UI in Excel and period wise planning. For a given Master Project there can be multiple plans and versions. Because, CPM does not have accounting objects, all the costs values can be transferred to SAP PS in the form of Easy Cost Planning.

Risks & Issues comes with flexible configuration. Matrix and Pie charts help prioritizing and tackling Risks & Issues. They can seamlessly result in Change Request and thereby changes to Cost Plan after approval cycle.

SAP Enterprise Project Connection: Enterprise Project Connection facilitates data transfer between SAP On-premise system and other project management tools like Oracle Primavera P6 or Microsoft Project Server. “Open PS” that was used integrate SAP PS with Microsoft Projects is now replaced with Enterprise Project Connection. EPC involves more technical effort than functional effort. The technical effort will be in the areas of XML, XSLT, Administration of EPC etc. with a little bit of ABAP skills to use/ create new SAP Function Modules/ BAPIs. The sample implementation solutions are available in the OSS note 2292815 – SAP EPC 3.0 Sample Integration Solutions (SIS) Document Collection. Further details on EPC can be found here.

SAP Innovation Management: Though SAP PPM addresses all project phases, it has a special capability to fill the vacuum` before the Project Set-up. That phase is called the “Proposal” phase. But there can be a budding phase even before Project Proposal. That is the ideation phase. Even the Ideation phase needs a specific set of processes to evolve and evaluate the Idea. On successful evaluation, the idea can be taken up as a Project Proposal to check and rate its fitment into the Portfolio Strategy. This capability of running campaigns for ideating and evaluating ideas from these campaigns is offered by SAP Innovation Management (INO). Thus, SAP INO can be a precursor to SAP PPM fostering the culture of innovation in the organizations.  Unlike other solution in SAP EPPM, SAP INO is a native HANA application. Yet, it can be integrated with SAP PPM.

With this, I hope the readers get the clarity about SAP EPPM, Overview of its solution components, and their distinctive capabilities that can address all the needs of Project-oriented Processes. You just need to choose the right set of its component solutions for the specific needs of a given business process. Please let me know your feedback and share this in your network who is looking for a high-level overview on SAP S/4HANA EPPM.

Readers can also refer the following for more details

  1. SAP Enterprise Portfolio and Project Management
  2. SAP Enterprise Project Connection
  3. SAP Innovation Management
  4. Community page: SAP Enterprise Portfolio and Project Management

You may also be interested in my other blogs

1. Automatic Calculation of Financial KPIs in SAP EPPM | SAP Blogs

2. Overcoming hurdles during the new setup of SAP PPM | SAP Blogs

Cheers,

Manjunadh.

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      17 Comments
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      Author's profile photo Raghavendra Mani
      Raghavendra Mani

      HI Manjunadh,

      Very good writeup and much needed explanation of the different offering.

      In your experience do you see these various project solutions being relevant for different project types? For example, for CAPEX projects vs revenue projects, would you recommend one solution over the other?

      Regards,

      Raghavendra Mani

      Author's profile photo Manjunadh Lolla
      Manjunadh Lolla
      Blog Post Author

      Hi Raghavendra,

      The answer is both Yes & No. Choice of solutions sometimes depends on nature of Projects. And sometimes on the business need. For example, if it is a human resource intensive Professional service Project like Consulting, SAP PPM will be the right choice. In Revenue projects it looks straight forward to use bid structure of SAP CPM. At the same time, one can also use sales pricing in SAP PS. In such case, the information available to the business team to run the process, and the business need will drive the choice of solution component. Sometimes, the need of a specific feature may demand the implementation of the solution component that offers the needed feature.

      Author's profile photo sujata ramesh
      sujata ramesh

      Much needed clarity esp. when SAP is coming up with product after product in this space addressing different business needs.  Very concise and to the point!  May be another write up on MRS & RSH will also help 🙂

      Author's profile photo Kun Liu
      Kun Liu

      HI Manjunadh

      Thanks for the interesting overview.

      could you please also explain how could ePPM work for rough cut capacity plan of material/equipment (external & internal sourcing)?

      Thank you!

      Best Regards

      Kun

      Author's profile photo Manjunadh Lolla
      Manjunadh Lolla
      Blog Post Author

      Hello Kun,

      EPPM encompasses PS and CPM as well. So, for Material planning you can use either SAP PS or SAP CPM. It is not possible in PPM Project.

      Author's profile photo Neil Henzen
      Neil Henzen

      Hi guys, I had a question today on EPPM for the Cloud and you can visit this blog and find further interesting links to more content. Enterprise Portfolio and Project Management in SAP S/4HANA Cloud 2102 | SAP Blogs

      Have a good day and thanks Manju, great to see you share your knowledge 🙂

      Author's profile photo Manjunadh Lolla
      Manjunadh Lolla
      Blog Post Author

      Thank you for adding this link Neil.

      Author's profile photo Aditya Kotak
      Aditya Kotak

      Hi Manjunadh,

      Thanks for the crisp and much needed explanation.

      In my current project, we are implementing EPPM on S/4 1909 and with PPM and PS to begin with, followed by CPM for enhanced AFO based, BW-IP based planning and forecasting process. Its very difficult to show an illustration on EPPM functionality on SAP portal as of now, but I guess this will surely help business to have a brief of SAP EPPM functionality going forward.

      Also, it has been 8 years we haven’t been in touch. Hope you are keeping safe and everyone’s doing well at home.

      Best Regards,
      Aditya Kotak

      Author's profile photo Manjunadh Lolla
      Manjunadh Lolla
      Blog Post Author

      Thank you Aditya. Yes, it has been a long time. Hope every good at your end too. Here is my another blog just posted today. Hope you find this also useful Automatic Calculation of Financial KPIs in SAP EPPM | SAP Blogs

      Author's profile photo Ramanujam Duraisamy
      Ramanujam Duraisamy

      Very well written blog. Provides very valuable perspective for some one who would like to explore this solution area.

      Many a thanks  and regards.

      Author's profile photo German Luna
      German Luna

      Thank you

      Author's profile photo Renato Zadro
      Renato Zadro

      Thank you Manju, very good overview !

      Author's profile photo Manjunadh Lolla
      Manjunadh Lolla
      Blog Post Author

      Got many inputs from you as well Renato. Thanks to you 🙂

      Author's profile photo Vasanthakumar Konduru
      Vasanthakumar Konduru

      Hi Manjunath,

      Thanks for a good overview on EPPM.

      Request you to please provide some inputs on SAP EPPM Licensing. Do we need separate license for SAP EPPM ? If an organization purchases SAP S/4HANA Professional User licenses, do they need to purchase separate license for EPPM?

      OR, if there is separate licensing for SAP EPPM, will it come along with S/4HANA Finance and analytics ?

      Thanks in advance.

      Vasanth.

      Author's profile photo Manjunadh Lolla
      Manjunadh Lolla
      Blog Post Author

      Hello Vasanth,

      EPPM comes with separate license. Inclusions and exclusions may keep changing time to time. Sales teams are appropriate to respond in this area.

      Needless to say, SAP PS will come with S/4Core.

      Author's profile photo Ravi Ravi
      Ravi Ravi

      Hi Manjunadh,

      Very clearly articulated on the features of PPM, CPM etc under the EPPM umbrella. Very useful. Appreciate it.

      Author's profile photo Mohamed Medani Elnour
      Mohamed Medani Elnour

      Hi Manjunadh,

      Thanks for your post

      Can we have EPPM and Professional Services solution implemented in same system?