From Sales Planning to integrated Profit Planning

SAPPHIRE Madrid, June 1998

Stefan Kraus
Product Manager CO-PA SAP AG Walldorf
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Agenda
Introduction Example of a Typical Implementation in CO-PA Planning
Setting

Objectives Planning Variances and Goal-Seeking Approaches

Bottom-Up Monitoring

Simulations

Emphasis on New 4.0 and 4.5 Functions

Ratio Planning

Benefits of Excel Integration

Event Planning

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Actual: Integrated Valueflows in CO-PA

CO

ECPCA

Profitability Analysis

Segments

Overhead Cost Controlling

Processes Internal orders

Product Cost
Controlling

Cost objects

Cost centers

Standard CoGM

Cost Element Accounting

FI
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REVENUES

SD

Overview of CO-PA Planning Functions

Planning Layouts Customizable Design Automatic Planning Functions Copy / Change / Generate Plans Top-Down Distribution Planning in CO-PA Integrated Planning

Integration of Excel Planning Aids

Revaluation Valuation Period Distrib.

Forecasts... Transfer of Cost Center/ Process Sales and Promotion Budgets Plans Settlement of Order/Project Event Planning Plans Monitoring of Sales Transfer Quantity from/to SOP Campaigns Transfer Plan Data from/to LIS Transfer of Plandata to EC-PCA
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Setting and Attaining Objectives in Profit Planning

Simulation

Rolling Forecast

Setting Objectives

Are Objectives Attained?

Head Office

Valuation
Top-Down Distribution by Sales Organization Bottom-Up Sales Quantity Planning

Sales Organizations

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Setting Objectives
Generate a plan proposal (e.g. Copy actual data) Revaluate,

Setting Objectives

aggregate,
redistribute

Manual planning

Valuate further values

Distribute top-down

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Planning Objectives with Goal-Seek Approach

Goal Seek Source Target Value Sold quantity Margin 20,000.00

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Top-Down Distribution Concept

1998 Plan Data

Top-Down Distribution By Operating Unit

Product hier.
Pumps

Revenue 9,000 9,000-

Data to be Distributed

Reference Data
Product Prod.hier. '97 Sls Qty Pumps 100 P1 Pumps 200 P2

Results: 1998 Plan Data

Product P1 P2 Prod. hierarchy Pumps Pumps Revenue 3,000 6,000

Results

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Bottom-Up Sales Quantity Planning

Bottom-Up Sales Quantity Planning

Sales org. SO1 Prod. grp: PrgrA Prgr B Quantity 250 180

Sales org. Product: Prod. grp: Customer: Quantity

SO1 Prod1 PrgrA Cust1 120

Sales org. Product: Prod. grp: Customer: Quantity

SO1 Prod2 PrgrB Cust2 180

Sales org. Product: Prod. grp: Customer: Quantity

SO1 Prod1 PrgrA Cust2 130

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 Valuation

Valuation of Actual Data

Profitability Analysis - Actual Data by Customer / Product / ...

Overhead costs Project costs Sales volume Sales price Sales deductions Cost of sales

Product costs

Quantity flow
Purchasing Manufacturing Sales

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 Valuation

Valuation of Plans with Operative Data

Profitability Analysis - Sales Plan by Product / Key Customer/...
Plan data transfers
Valuation with CO-PC Valuation with SD prices

Profitability Analysis - Actual Data by Customer / Product / ...

Overhead costs Project costs Sales price Sales volume Sales deductions Cost of sales

Product costs

Quantity flow
Purchasing Manufacturing Sales

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Valuation with Ratios Implicitly Stored in CO-PA Reference Data

Profitability Analysis - Sales Plan by Product / Key Customer/...
Ratio Ratio Ratio Ratio Ratio Ratio Ratio Ratio Ratio Ratio Ratio

CO-PA Reference Data Profitability Analysis - Actual data by Customer / Product /...
Overhead costs Project costs Sales price Sales volume Sales deductions Cost of sales

Product costs

Quantity flow
Purchasing Manufacturing Sales

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Planning with a Ratio Scheme

Record Type F Year 1997 Version R, Reference Version Current
sales plan
Customer Group Revenue (Plan) Price (Ratio M1) Sales Qty. (Plan)

Record Type F Year 1998 Version 1, Plan Version Current

sales plan
Customer Group Sales Qty. (Plan) Revenue (Qty * M1)

01 02 03

100,000 225,000 240,000

10.00 15.00 12.00

10,000 15,000 20,000

01 02 03

25,000 10,000 10,000

250,000 150,000 120,000

Ratio Scheme A: Revenue Ratio M1 = Quantity

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Workflow: Simulating Quantity and Price Changes

Price Planning
Actual data serves as basis Actual data copied to ref. version

Reference version Referenzversion

Reference version defined Modify reference version

Plan prices exist

Quantity (Q1) Revenue (R1) Net revenue ......

100 2000

Plan version serves as basis

Plan data copied to ref. version

- Revaluate - Correct prices - Redistribute to periods - Calculate average prices (e.g. for product groups)

Valuation using ratios

Quantity Planning
Quantities are to be planned Analytical planning of sales quantities Copy sales quantities Correct, revaluate quantities Quantity plan is defined Valuate quantities using ref. prices Status of plan must be checked Change quantities Planning goals met SAP AG CO-PA Planning / S. Kraus June.1998/ 14 Change prices

Current plan version Qty (Q1) 150 Rev. (R1) 3000 Net revenue ......

Simulation

Are Objectives Attained?

Generate a plan proposal (e.g. copy actual data) Planning

Are Objectives Attained?

Compare Manual planning

of
sales quantity

Valuation

objectives with sales plan

Company

Objectives

Division Prod. Hier. Pumps Sales org. Product 1000 P1 1000 P2

Objectives are attained ?

Bottom-up Plan

Key customer, Product, Quantity

C1 C2 C1 P1 P2 P2 100 PC 150 PC 200 PC

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Setting and Attaining Objectives in Profit Planning

Simulation

Rolling Forecast

Setting Objectives

Are Objectives Attained?

Head Office

Valuation
Top-Down Distribution by Sales Organization Bottom-Up Sales Quantity Planning

Sales Organizations

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Planning of Events

Reference to period Reference to value, qty field Example of a revaluation factor

Sales campaign
0

Reference to 1 2 3 profitablity segment

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Integration of MS Excel in Profitability Planning

Planning layouts communicate with Excel

Flexible download and upload to support decentralized planning

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Integrated Planning in SAP

LIS Sales and Profit Planning CO-PA

PP
St t

SOP Product Costing CO-PC Cost Center CO-OM Business Process CO-ABC

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