p t ti gcp e i f c t c t lli presentation gcp engine for ... · if ti m t&c ltiinformations...

I f ti M t & C ltiInformations Management & Consulting

P t ti GCP E i f C t C t lli1© IM&C GmbH · 26.04.2010www.im-c.net

Presentation GCP Engine for Corporate Controlling

A dAgenda

Di l f fli t b t S l d V l Ch i diff ti tiDisplay areas of conflict between Supply- and Value Chain differentiation

Significance of local and global cost component splitting

Components of GCP

Integrated corporate planning with GCP

Summary

2© IM&C GmbH · 26.04.2010www.im-c.net

S l d V l Ch i T dSupply and Value Chain Trends

Gl b li tiGlobalization

Increased cross border sourcing

Collaboration for parts of value chain with low-cost providers

Shared Service Centers for logistical and administrative functions

Increasingly global operations require increasingly global coordination and planning to achieve global optimums

Complex of problems comprises also midsized companies to an increasing degree


Parameters of Impact for Global Location ManagementParameters of Impact for Global Location Management

C t f th ti l l tiCosts of the particular location(purchase prices, wage level etc.)

Transport costTransport cost

Transfer prices, sales prices

Customs (embargo etc )Customs (embargo etc.)

Tax rates

Economic safety

Education level, quality


St t Of Th A t S l Ch i Pl iState-Of-The-Art: Supply Chain Planning

E t i id d d d l l i i SAP SCMEnterprise-wide demand and supply planning in mySAP SCMSAP APO Demand PlanningSAP APO Supply Network Planning

Central planning platform with integration into both, SAP and non-SAP operational systems

Total integration of supply – demand planning (quantities) with plan vs. actual controls


T i l E t i S l Ch i S t L dTypical Enterprise Supply Chain System Landscape

APOAPOBWR/3 R/3 R/3

Master DATA

Supply ChainCockpit

DemandPlanning

SNP

Reporting

TransactionData

Enterprise Data Warehouse

Universal DataCore Business Global Planning

Supply Chain Decision Support

Enterprise Transaction System(s)

Universal Data Access

Universal Reporting Tools

Core Business Processes

Core Master Data Standards

Global Planning

Global / Local Logistics


St t Of Th A t V l Ch i Pl iState-Of-The-Art: Value Chain Planning

E t i ti f l / t l i l bl f ll itEnterprise costing for plan / actual is only usable for a very small community of totally standardized SAP users

Very high constraints – non-functional when:Very high constraints non functional when:Several SAP clients in one SAP systemSeveral SAP systemsSeveral costing areas in one clientSeveral costing areas in one clientSeveral cost structures in one clientDifferent numbering systems for master data

Value chain “islands” driven by system architecture


C fli t Sit tiConflict Situation

Supply chain planning Enterprise costing –Value chain planning

Flexible network Highly restrictiveFlexible network

Central planning for decentralized operational systems (APS)

Bottleneck and capacity planning

Highly restrictive

Highly dependant of operational system architecture

Inflexible for planning transport costBottleneck and capacity planning

Procurement planning

ATP planning

Inflexible for planning transport cost across plants

No integration of opening stock

No integration of APS resultsLocation and distribution network planning

No integration of APS results

Excel as band-aid

No transparency into true profitability, COGS and margins by product


and customer from a total enterprise perspective

Th S l ti GCP E iThe Solution: GCP Engine

Group

Capture of accumulated inter-company profit(s) by sale(s) to the market (outside the enterprise / group)

Costing

Calculation of cross-company value chains

Profitability

Capture the cost component split and contribution margin by

Engine

Capture the cost component split and contribution margin by product and by customer in local view as well as in group view

Best-of-breed component with a defined interface to any legacy systems


Basis for an integrated solution:Leverage Supply Chain Planning

V l h i “i l d ” bi d i t l t i t l b l lValue chain “islands” are combined in a central system into a global value chain model

Corresponding to the quantity flow of the supply chain the value chainCorresponding to the quantity flow of the supply chain the value chain components are pulled from the operational systems

Local, historic and consolidated product cost is integrated and calculated in the central value chain system

A globally defined cost element structure will be generated with the global value chainchain


Li it ti f G C ti (Pl )Limitations of Group Costing (Plan)

All b idi i i li t R/3 t l b llAll subsidiaries in one client, one R/3 system globally

One controlling area globally

Unique usage of one cost component split globally

Unique material-, vendor- and customer numbers

Cost of sales locally can not be mapped as cost of manufacture for global purpose

Transport cost between plants of different subsidiaries

Special procurement key must be maintained and only one may be defined by materialdefined by material

Mixed costings must to be manually maintained in case of procurement alternatives


p

Li it ti f G C ti (A t l )Limitations of Group Costing (Actuals)

All t i ti f l l f t lAll restrictions of plan apply even more for actuals

Special procurement and mixed costings are not relevant for actual scenariosactual scenarios

ML (Material Ledger) has to be activated with parallel valuation

IDOC has to be activated for sending and receiving plantsIDOC has to be activated for sending and receiving plants

Strange valuation of IC goods receipts with correction only at time of invoice received

ML, parallel valuation is considered as highly complex, even from knowledgeable SAP consultants

ML used at BASF, but only locally -> Straßburg


A dAgenda



Components of GCP


Summary


Value chain of group receiver paid delivery costsValue chain of group, receiver paid delivery costs

Market

Company 3Switzerland 75

Profit: 5

Company 2

75Product G

Intercompany Profit: 20

Freight: 1 Customs: 1

p yBrazil

5Material E

40Material D

5Material F

53Product G

yVerpackung: 1Production var.:1Production fix: 1

Company 1Germany 33

Material E Material D Material F

Intercompany Profit: 5

Freight: 1 Customs: 1

Packaging: 1Germany

10Material A

10Material B

10Material C

33Product D

Packaging: 1Production var.:1Production fix: 1


Goods: 9Customs: 1

Value Chain of Group Numerical ExampleValue Chain of Group, Numerical Example

fix varia

ble

fix varia

ble

olle

d

d ny P

rofit

nue

Group Cost Structure Revenue Structurein Group Currency in Group Currencyin Group Currency

Local Costs Structure

Mat

eria

l

Prod

uctio

n f

Prod

uctio

n v

Pack

agin

g

Frei

ght

Cust

oms

Tota

l

Mat

eria

l

Prod

uctio

n f

Prod

uctio

n v

Pack

agin

g

Frei

ght u

pro

Toll

upro

lled

Inte

rcom

pan

Tota

l

Frei

ght

Toll

Prof

it

Gro

ss R

even

Dedu

ctio

ns

Product G 73,00 1,00 1,00 75,00 39,00 2,00 2,00 2,00 2,00 3,00 25,00 75,00 5,00 80,00Material G 73 00 1 00 1 00 75 00 39 00 2 00 2 00 2 00 2 00 3 00 25 00 75 00nd Material G 73,00 1,00 1,00 75,00 39,00 2,00 2,00 2,00 2,00 3,00 25,00 75,00

Product G 48,00 1,00 1,00 1,00 1,00 1,00 53,00 39,00 2,00 2,00 2,00 1,00 2,00 5,00 53,00 20,00 73,00Production 1,00 1,00 1,00 3,00 1,00 1,00 1,00 3,00

Switz

erla

il

Material D 38,00 1,00 1,00 40,00 29,00 1,00 1,00 1,00 1,00 2,00 5,00 40,00Material E 5,00 5,00 5,00 5,00Material F 5,00 5,00 5,00 5,00

Product D 29,00 1,00 1,00 1,00 1,00 33,00 29,00 1,00 1,00 1,00 1,00 33,00 5,00 38,00Production 1,00 1,00 1,00 3,00 1,00 1,00 1,00 3,00Material A 10,00 10,00 10,00 10,00m

any

Braz

Material A 10,00 10,00 10,00 10,00Material B 10,00 10,00 10,00 10,00Material C 9,00 1,00 10,00 9,00 1,00 10,00G

erm


GCP Cost Component SplitGCP Cost Component Split

Manufacturing costs structure (rolled Revenues structure (of level)g (up)

( )

Local Cost Component Split in local currency10SAP

Legal valuation in local currencyLOCAL

Local Cost Component Split in group currency30

P+ S + A... +Gross

RevenuesSales

Reductions= -fix variable

HISTORIC

fix variable

Local valuation in group currency

fi Pi bl S A IP S + A

Global Cost Component Split in group currency

Gross Sales

31Global valuation in group currency

GLOBAL

fix Pvariable S + A… IP + S + A… + RevenuesSales

Reductions= -

Manufacturing Cost Net Profit


Cost of SalesProfit not defined as

a table field

GCP Reporting ViewsGCP Reporting – Views

Cross Local Historic GlobalCross Local Historic Global

Total value TOTALS LTOTAL HTOTAL GTOTAL

Fix / Variable FIX_VAR LFIX_VAR HFIX_VAR GFIX_VAR

Variable VAR LVAR HVAR GVARVariable VAR LVAR HVAR GVAR

CC split (all) ALL LCC HCC GCC

VariableVALL LVCC HVCC GVCC

FixFALL LFCC HFCC GFCC


N i C tiNaming Conventions

Prefix View:L Local

Additional Prefix for Formulas and Static Variables.Formulas and static variables get an additional prefix in the 5th place:L Local

G GlobalH Historic

Prefix Fix/Variable:F Fix

Formulas and static variables get an additional prefix in the 5th place:

F_ FormulaS_ Static Variable

F FixV VariableT Totals

Prefix Type of Structure:C CostC CostP Profit

Prefix Type of Cost Component:_ Manufacturing Cost (Placeholder)I I fiI IntercompanyprofitU Roll UpR RevenuesD Deductions

G V C _ Cost = Global Variable Manufacturing Cost

1 2 3 4 Positions:


3os o s

GCP P d L l C t C t S litGCP Processes and Local Cost Component Split

GCP Process TTYPE Revenues Reductions S+A

LFC LVC LVPR LVPD LVPU+ B i i B l 1000

local

+ Beginning Balance 1000+ External Purchase 3100+ Production 3010+ Transfer IC 5100+ Other= Precosting Balance 6000- External Sales 7200- Delivery IC confirmed 8100- Consumption for Production 8300- Other

Ending Balance 9000= Ending Balance 9000


GCP P d Hi t i l C t C t S litGCP Processes and Historical Cost Component Split

GCP Process TTYPE Revenues Reductions S*A

HFC HVC HVPR HVPD HVPU+ B i i B l 1000

historic

+ Beginning Balance 1000+ External Purchase 3100+ Production 3010+ Transfer IC 5100 Transfer IC 5100+ Other= Precosting Balance 6000- External Sales 7200- Delivery IC confirmed 8100- Consumption for Production 8300- Other

E di B l 9000= Ending Balance 9000


GCP P d Gl b l C t C t S litGCP Processes and Global Cost Component Split

GCP Process TTYPE S+A IPGFC GVC GFCU / GVCU GVCI

+ Beginning Balance 1000

global

+ External Purchase 3100+ Production 3010+ Transfer IC 5100

O+ Other= Precosting Balance 6000- External Sales 7200- Delivery IC confirmed 8100 Delivery IC confirmed 8100- Consumption for Production 8300- Other= Ending Balance 9000


A dAgenda



Components of GCP


Summary


GCP C t iGCP-Components overview

GCP-Core Extraction Aggregation Sequence Costing PostingGCP Core gg g q g

Simulation Top-DownPlanning

g

OperationalFunctions

Simulation CostingNet-Change

CostingManual

Corrections

Functions

Functions Corrections

Reporting Status-Table BusinessReporting Exceptional Reporting Reporting


GCP P d Vi li tiGCP Processes and Visualization

TTYPE+ Beginning Balance 1000 = Ending Balance Previous Period+ External Purchase 3100

GCP Process

+ External Purchase 3100+ Production 3010+ Transfer IC 5100+ Other

"forming prices"

+ Other ...= Precosting Balance 6000- External Sales 7200

Delivery IC approved 8100- Delivery IC approved 8100- Consumption for Production 8310- Other ...

E di B l 9000

"using prices"

= Ending Balance 9000


S l Ch i V l Ch i I t tiSupply Chain – Value Chain Integration

DemandPlanning

APO

R/3 R/3 R/3 Group Costing Profitability (GCP) Engine BW

SNP

R/3 R/3 R/3 p g y ( ) g

E t kti PlanExtraktion Plan

Planning: Integration of the Supply-Network Planning result


Planning: Integration of the Supply Network Planning resultinto GCP Planning

GCP E t tiGCP Extraction

I R

/3

I R

/3 R/3 Group Costing Profitability (GCP) Engine BW

Aggregation Sequencing CostingExtraction

Reading relevant data from operational SAP & non-SAP systemsSales (CO-PA actual), good receipts, invoices, consumption, production

M i f ti l t ti t GCP t tiMapping of operational transactions to GCP transactions

Mapping of operational cost vectors to GCP cost vectors

Checking for completion and integrity

Distinguishing error levels and data transfer to the exceptional reporting component (email to the responsible legacy user)component (email to the responsible legacy user)

Writing of status and statistic information


Pl d R lt A l i b d it i ti i R/3Planned Results Analysis based on itemization in R/3

Pos.Typ Ressource Qty. Total Value

E Bearbeiten Blech 20 Min 30 EUR

P Prozeßkosten 2 1 St 1 EUR


Plate 100-700 1 Pce


E Bearbeiten Blech 20 Min 30 EUR

P Pro eßkosten 2 1 St 1 EUR

Axle 100-300 1 Pce


Pump New 1 Pce

R/3 HitechAsia

NavisionSales Agencies


M Blech 100-700 0,6 m2 5 EUR

M Welle 100-300 s St 5 EUR



M Blech 100-700 0,6 m2 5 EUR

M Welle 100-300 s St 5 EUR

E Process Axle 20 min 30 EUR

P Legal Costs 2 1 Pce 1 EUR

P Legal Costs 3 1 Pce 2 EUR

M Plate 100-700 0,6 m2 5 EUR

M Axle 100-300 s Pce 5 EUR

GCP EngineGCP EngineR/3 Automotive

EuropeExcel

R/2 ChemicalIndustry US

other non-SAPSystems


A t l R lt A l i b d th t d t l d tActual Results Analysis based on the posted actual data

N i iGoods Receipts

I iR/3 company

Germany

NavisionSales Agencies

InvoicesConsumption

Production

GCP EngineR/3 company

FranceExcel

ML-tables

FranceMaterial Ledger active

R/2 ChemicalIndustry US

other non-SAPsystems


GCP AggregationGCP Aggregation

I R

/3

I R


Sequencing CostingExtractionAggregation

Converting single items transaction currency local currency and group currency

Mapping cost components single items local and global value vectors in theMapping cost components single items local and global value vectors in the aggregated data record (Financial Item)

Accumulation based on the costing level that is defined in customizing by period and transaction (purchase transfer sales consumption etc )period and transaction (purchase, transfer, sales, consumption etc.)

Generate a graph with nodes and edges with costing items, the edges define the relation between the costing items. The quantities consumed, transferred or sold define the edge of the graph.

Transfer error handling to exceptional reporting, status and statistics


GCP S iGCP Sequencing

R/3

I R


CostingExtraction AggregationSequencing

Read edges from the graph determined before

Determine costing items to start with and finish along with the calculation levels in between all value chains of the groupin between all value chains of the group

Identifying and exploding of recursions

Determining and updating the calculation levels for the costing items

Transfer error handling to exceptional reporting

Writing of status and statistic information


GCP C tiGCP C tiGCP CostingGCP Costing

R/3

I R


Extraction Aggregation SequencingCosting

Processing costing items in sequence according to the calculation levels determined

Period boundary processing

Costing of movements leaving inventory (consumption, sales) using the average price of the pre-costing balance

Exploding material costs according to the cost production vector of the delivering plant in p g g p g pcase of deliveries from the group and adjusting inter-company profits

Mapping cost of sales, that need to be rolled up into manufacturing cost for the group into appropriate cost component split of the groupappropriate cost component split of the group

Calculate ending balance as: pre-costing balance – movements leaving inventory

Updating the calculated financial items


p g

GCP Si l tiGCP Simulation

R/3

I R


Simulation

Simulation of Purchase Price ChangesSales Price ChangesExchange Rate Changes

Versioning

Re-aggregation using new prices / exchange rates

Plan / Actual mix over reporting periods


E t i C t lli S t L d ith GCPEnterprise Controlling System Landscape with GCP

BWGroup Costing Profitability (GCP) EngineR/3 R/3 R/3

ReportingActual

Master DATA

Plan

Simulation

TransactionData

Consistent data & program basis for Actual / Plan / Simulation


A dAgenda



Components of GCP


Summary


T i l Gl b l Pl i E i tTypical Global Planning Environment

Value ChainView

Company 4

LocalPlanning

Value ChainValue ChainView

Company 3

LocalPlanning

GlobalPlanning

Value Chain LocalViewCompany 1

Value ChainView

LocalPlanning

LocalPlanning


ViewCompany 2

Planning

Example: CRM / APO / BPS Integration

D dS l

APO4Sales Volume

(Logistic)3

DemandPlanning

Supply NetworkPlanning Demand

(Market)

(Logistic)

Supply Chain Optimization

Enterprise Planning and Simulation

Profit-Planning

MarketAnalysis & Analytical

Simulation5 1

2

SAP BW

Planning

SalesPlanning

Analysis &Simulation

AnalyticalCRM

Growth Targets


APS/BI Integration of GCPAPS/BI Integration of GCP

APS (APO)4 3

Globally agreed S&D plan, i l di titi f

DPSNP4

SC Optimization

3including quantities for:sales, production, purchase, transportactivitiesservices

fin. mat.plant Cfin. mat

TO

GCPOperative systems

(R/3)

8

atplant B

semifin mat

semifin. mat.plant B

BOTTOM

OP-DOWN

(R/3)

Local Costby

lot size

Iteration

7 Modification if appropriate

semifin. mat.plant A

raw mat.plant A

-UP

N

Adjust

lot size

BI (BPS/BW)

Purchasing CostSales Cost

Adjust cost center planning

as appropriate(6) BPS

BI (BPS/BW)5

Group Cost Split

Intercompany

9


Intercompany Profit BW

JNET Visualization and NavigationJNET Visualization and Navigation

GCP FI Display

GCP ALV BrowserGCP ALV Browser


GCP A l ti P t t D t M d llGCP Analytics Prototyp – Data Modell

Presentation of Contribution Margin gScheme with BW Formulas

GCP Multiprovider

Order‐related Contribution

Multiprovider

Margin AnalysisCOSAdding order‐related

data and splitting of costs

Material‐related Contribution Margin Accounting

Difference Analysis of Stockable Type (Plan‐Actual)

Material‐related Profit and LossTCA

DSO Financial Item DSO Single ItemMFPLV

So rce S stem

Datasource FI Datasource SI

MFPLVInformationen like Scenario Context (Actual, Plan)


Source SystemGCP Engine

Visualization of Cost Buckets in Gross Margin View

Profit

Visualization of Cost Buckets in Gross Margin View

Cost Variabel

Cost Fix

T f P i

Value Added

Historical Group

30

Transfer Price

802

25

Historical Group

73

5

Historical Group

(25+5)

1

20

14Historical & Group

25(5+20)

2 (2+0)2 (1+1)

32

15

38

73

46(32+14)

38

48(46+2)

32 38

Germany Brazil Switzerland



Visualization of Cost Buckets in Gross Contribution Margin ViewVisualization of Cost Buckets in Gross Contribution Margin View

ProfitContribution Margin

Cost Variabel

Cost Fix

T f P i Historical GroupTransfer Price

30

802

25

Historical Group

73

5

Historical Group

(25+5)

1

20

14Historical & Group

25(5+20)

2 (2+0)2 (1+1)

32

15

38

73

46(32+14)

38

48(46+2)

32 38




Visualization of Cost / Revenue Buckets by PlantVisualization of Cost / Revenue Buckets by Plant

100%

80%

60%

Deduction

Categories

40%

Deduction

Profit

LVA

Mat Ext

20%

Mat.Ext

Internal Sale

Sales of Subcontracting

Thi d t t d l

20%

0%DE

Plant 1180CC 6160

CHPlant 1001CC1201

DEPlant 2630CC 6166

CHPlant 1001CC1201

DEPlant 2601CC1298

Third-party to dealerThird-party to affiliate


‐20%

Value Contribution Buckets by Currency and PlantValue Contribution Buckets by Currency and Plant

External Customer

Internal Sale

Toll Sale

Thi d t t d lThird-party to dealerThird-party to affiliate


A dAgenda



Components of GCP


Summary


B i B fitBusiness Benefit

L f S l Ch i l i i t t di tl f ti lLeverage of Supply Chain planning investments directly for operational Value Chain planning

Faster cycle times more planning cycles with more accurate dataFaster cycle times more planning cycles with more accurate data

No change to underlying operational systems

Incremental value chain planning work process building blocks leveraging SAP components and tools (SEM, BW, BPS)


F th I f ti b t GCPFurther Information about GCP

P t ti t S l Ch i W ld 2006Presentation at Supply Chain World 2006“From global SCM to Group Cost and Profitability”

Article published in the magazine CONTROLLINGArticle, published in the magazine CONTROLLING“IT based profitability planning and control for enterprises”, edition 6/2005

Presentation at DSAG, April 2005“Possibilities and Limitations of Group Costing”

Presentation at SAP Finance Best Practice Workshop in Barcelona, September 2005September 2005,“How to combine Profit Center and Group Profitability”

Presentation at SAP Finance Best Practice Workshop in Hamburg, Juni 2008p g„Profitability Management in Global Value Chains”


I f ti M t & C ltiInformations Management & Consulting

P t ti GCP E i f C t C t lli47© IM&C GmbH · 26.04.2010www.im-c.net

Presentation GCP Engine for Corporate Controlling

p t ti gcp e i f c t c t lli presentation gcp engine for ... · if ti m t&c ltiinformations...

Documents