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Author's profile photo Rahul Chandra Kini

SAP S/4HANA Project Manufacturing Management & Optimization

We are very excited and happy to announce the General Availability(GA) and first public release of Project Manufacturing Management & Optimization (PMMO) solution with the SAP S/4HANA 2020 On-premise release!!

Quick Overview

Here is a Digital Product experience video for a short introduction to PMMO and its value proposition for our customers.


PMMO will provide advanced capabilities for Make To Order (MTO), Make To Project (MTP) & Engineer To Order (ETO) manufacturing processes and also provide cost tracking in S/4HANA. It includes features that provides logistical tracking of replenishment orders to the end products. It contains functionality that allocates the individual cost types from grouped stock to the WBS elements that drive demand requirements.

Built natively in S/4HANA, PMMO will be the successor solution to GPD (Grouping, Pegging,  Distribution). The open design of PMMO will enable broader use across industries and support future cloud enablement.



Product Highlights for 2020 Release:

  1. PMMO integration with materials and logistics management to enable project driven manufacturing
  2. Pegging
  3. Flexible cost distribution
  4. Migration report for moving from GPD to PMMO
  5. Runs with EWM

Improvements over GPD solution (selected highlights):

  • Pegging and cost distribution program uses parallel processing.
  • Improved data structure by capturing additional MRP data
  • Enhancement via Subclasses (BADIs replaced by classes and methods)

Additional Links

There is more functionality and scope planned in the SAP S/4HANA 2021 release which can be found in the roadmap link or in Innovation Discovery

More information about PMMO on the SAP Help Portal – PMMO Help Portal


Please leave your feedback or questions if any in the comments section below.

I will look to add more posts in the coming weeks with more details on each of the Product Highlights listed above.


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      Author's profile photo Pablo Dominguez
      Pablo Dominguez

      Hi Rahul

      Thanks for the info and the blog. One question about effectivity and PPMO. How does PPMO deals with effectivity and complex manufacturing projects (P&EO)?. If a grouping WBS element groups WBS elements for which more than one effectivity value is defined, how does pegging and distribution deals with the effectivity assignment to the planned / production order? Hope the question is understood!

      Thanks again for the blog and the info.

      Author's profile photo Hank Schrandt
      Hank Schrandt

      Hi Pablo,


      Rahul has asked me to follow up.

      Your question about "Effectivity" is a little vague.  The are various forms of "Effectivity" that uses Change Documents that controls which data set from the Master Data is to be used.  The is Date Effectivity, Serial Number Effectivity used by Serial Numbers on Order Headers for selecting the appropriate data set within the Master Data and a thing called Model-Unit  (say like F16 Tail# 1001 verses F16 Tail#1002).  For A&D, I will assume you are referring to Model-Unit.

      Model-Unit specific data is tied to other nodes and branches at the top of the Engineering BOM tree that can be unique by tail#  (which can be the same as the MRP BOM tree depending on where on the Engineering BOM tree MRP planning starts while the top part of the Engineering BOM Tree can be built within Project Systems using Network-Activities).

      FYI for other readers.   PMMO is an optimization tool to procure and manufacture common part numbers collectively on common Replenishment Orders used for supporting multiple projects to optimize the supply chain process.   PMMO Pegging program uses MRP logic to create records to identify the Project WBS Elements that share ownership of those orders so that PMMO Cost Distribution program can expense their costs to these WBS Elements.

      PMMO (much like GPD in this perspective) does not consider Model-Unit, as it should. MRP uses FIFO to align stock and supply Replenishment Orders to their Next Higher Assembly Orders when Planned by MRP Area, Material Number and Group WBS (when using GPD or PMMO).  If multiple model-units for a particular part number are within the same MRP planning segment, there are no assurances that MRP planning is correct.  MRP follows dates, not model-unit numbers.  This is one reason that each Model-Unit should have its own Operative WBS Element on Projects and have MRP plan by  MRP Area, Material and Operative WBS (for segregation by Model-Unit).  GPD and PMMO just follows MRP.  >>>FYI.   Unlike GPD, PMMO pegging captures NHA Order, requirement qty+ date, as well as Top Level Demand Object, requirement qty + date. >>>FYI.  S4HANA has MRP Area always active which is why PMMO replaced Plant with MRP Area as a key field.

      Because GPD and PMMO Pegging does not include Model-Unit Orders, Cost Distribution is not involved.  If there are GPD or PMMO components  on the reservation (RESB) table for these Model-Unit Production Orders, the components  will be pegged to the Operative WBS on these MU Orders as "Assigned WBS Elements" on the pegging records and will get expensed to those Operative WBS Elements.

      Another reason for Model-Unit Numbers needs to have their own operative WBS Elements is because PEO requires it.  Characteristic data is stored on these Operative WBS Elements for each Model-Unit number that gets used by the PEO work orders.  If only "Classic" PP manufacturing is the process used, recommend using Material-WBS BOMs and Routings for each Model-Unit when MRP configuration is active to include this capability..

      Model-Unit Effectivity should never be used in a Group WBS.

      Date Effectivity and Serial Number Effectivity (single level, not Model-Unit which is multilevel) is supported by MRP/PP processes which means so does GPD and PMMO.


      Hope this answers your questions.

      Best of Luck.

      Hank Schrandt

      Author's profile photo Flavio Molina
      Flavio Molina

      Hank, has PMMO similar functionalities as we wave in ePPDS?

      Can we integrate PMMO with ePPDS?

      Best Regards.


      Author's profile photo Rahul Chandra Kini
      Rahul Chandra Kini
      Blog Post Author

      Hi Molina,

      PMMO in S/4 on-premise is the next generation solution for project manufacturing and is much more improved compared to the older GPD solution which is in ECC and S/4. Both GPD/PMMO pegging logic follows MRP pegging and hence it differs from PP/DS in that respect. You can find more information regarding PMMO functionality in these links - a) PMMO Help Portal b) PMMO blogs

      There is no out of the box integration available between ePPDS and PMMO. But we ran some tests earlier last year and found the below which might be useful to you:

      PP/DS currently does not recognize lot-size within individual requirement (MTO or MTP) but only supports lot-for-lot. Customer needs to implement enhancement (BADI) to support different lot sizes to group replenishments together to align with demand grouping.

      Please also note below two observations:

      1. PS order (Network) does not get transferred to ePPDS (into active plan version automatically) like PP order but requires active CIF model
      2. WBS requirement grouping does get recognized in ePPDS out-of-box without any CIF enhancement