| Various Cost Planning Methods
in PS
I have come across various cost Planning methods like:
Here is a very brief overview for you: Easy Cost Planning(ECP) is really Unit Costing with a pretty face (MysapCom). It is used in Transaction CJ20N (Project Builder) only. You can set up 'Cost Models' in ECP using Characteristics which can be used to calculate values and automatically create Cost Plan Line Items - this is useful for companies who have pre-set planning methods (eg. Planning costs for building a bicycle, or a chemical test that requires known materials, labour, services and general costs.). It is a very flexible tool. An extention to ECP is Execution Services, which allows you to automatically generate Material Reservations, Purchase Requisitions and Activity Allocations. Its disadvantages (versus Networks) is that the planned costs are all aggregated to one WBS (unless you split your WBS's up to reflect the work you are doing - Labour, Materials, Equipment etc). Therefore, actual costs hit the WBS itself, not the line-item to which you planned. Disadvantages of ECP is that it does not distribute planned costs across time (no distribution rule). Also, there is no scheduling (start-finish, dependencies). Configuration for ECP is relatively straight forward. Costs for ECP can be planned against any Plan Version (default is Plan Version 0). Networks allow you to plan costs via objects called Network Activities. They can be maintained not only in CJ20N, but also in CJ2D. They are a little more complex to use, but they allow you to have a networked structure. Each Network Activity can have planned costs for Work Centre/Activity Type, Stock/Non-stock Materials, Services and General Costs by Cost Element. Activities can have a list of Material Components. Networks will generate Material Reservations and/or Purchase
Requisitions automatically. Configuration can be very complex. All costs
for Networks are sent to Plan Version 0. Distribution of costs across time
is supported.
For a quick, easy planning method, ECP cannot be beaten as long as you don't want complex scheduling. It is impossible to list all the feature/advantages/disadvantages to the planning methods in this. SAP PS Tips by : Kieron Dowling
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