Planning Costs for WBS Elements

Objectives

After completing this lesson, you will be able to:

  • List methods for cost planning with a Work Breakdown Structure (WBS)

Methods of Cost Planning for WBS Elements

Planning Costs in Projects

Linda, the project controller now checks the created project by James, the project planner. She discusses with him how the costs should be calculated for the project.

Note
See the following video to follow their conversation:

Different Methods of Cost Planning and Calculation

You can plan costs for a project in the SAP Project System (SAP PS) based on WBS elements and/or network activities.

The following are various ways in which you can plan costs for WBS elements:

  • Overall planning

    This is the most basic form of cost planning, where the costs for WBS elements are entered manually. You can choose to break down your figures by fiscal year.

  • Detailed planning

    This type of planning (of primary costs and activity inputs) is based on cost elements and periods.

  • Unit costing

    For each WBS element, you use a scheme for entering quantities, such as materials, internal activities, external activities, variable items, and so on. This type of planning is cost element-based.

  • Easy Cost Planning (ECP)

    ECP is a user-friendly method for performing element-based cost planning by means of a quantity structure. You can then use execution services to enter commitment and actual data relating to planned costs.

  • SAP Business Planning and Consolidation (BPC)

    This is a method used to plan costs in SAP Analysis for Microsoft Office (for example in Microsoft Excel) and transfer the data directly to the SAP S/4HANA planning tables in the back-end system.

In addition to manual planning in the WBS, you can assign different types of orders (internal orders or maintenance orders) to WBS elements that are flagged as account assignment elements. This assignment can then be used to display the planned costs of the orders for the project. You can also assign activities to WBS elements and plan costs using these activities.

Easy Cost Planning for WBS Elements

Planning Costs with Easy Cost Planning (ECP)

Easy Cost Planning (ECP) enables you to plan costs for WBS elements. You can access ECP for projects from the Project Builder. You choose a WBS element from the structure and then create costing items for this WBS element. Cost planning with ECP is cost element-based. The cost planning periods are determined from the basic start and the basic end date of the WBS element. To enter costing items, you can also use planning forms. When you do this, characteristics, such as work in hours, are valuated. The characteristic values from the planning form are linked to quantities, values, or actions in the costing items (for example, to the quantity of an internal activity). Once you have transferred the values, the costing items appear under the relevant WBS elements in the structure.

ECP can be used to create a simple, preliminary costing for projects. The pre-planned costs are then replaced, for example, by a quantity structure of networks and activities. You can also use ECP to create planned data for the project execution phase. In this case, you can use execution services to enter commitment and actual costs for the planned costs.

How to Execute Easy Cost Planning (ECP)

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