Outlining a Work Breakdown Structure (WBS)

James is a project planner at Hybrid Machinery. Linda works there as a controller. They are discussing the project structure James has created for the logistics project.

Project F-100## is used as an example of a prototype sales project that is mapped in the SAP system with a WBS and a network. The starting point for creating and executing the project in this business example is a customer inquiry for prototype development, and later, a sales order for the design and construction of a new forklift prototype. In addition to cost controlling aspects for developing and constructing the prototype, it is also important to consider a number of logistical requirements (on-time material procurement, availability of capacity). The network acts as a quantity structure for planning dates, costs, resources, and material requirements automatically.

The following steps are carried out for project F-100##:

1. Create a project (WBS and network) using standard structures.
2. Plan dates using scheduling.
3. Plan resources:
   • Capacity requirements
   • Workforce planning
   • External procurement of services
4. Plan materials by transferring bills of material.
5. Plan costs using network costing.
6. Create a sales order with a billing plan in Sales and Distribution.
7. Enter confirmations (in particular, using the Cross-Application Time Sheet [CATS]).
8. Purchase materials and services.
9. Document variances using claims.
10. Post revenues using milestone billing.
11. Calculate overhead costs, carry out a results analysis, and settle the results analysis values to the profitability segment.

In this business example, you will also use suitable reports to track planned and actual data (dates, resources, costs, revenues, and payments) that is written to the network activities. By assigning the activities to WBS elements, you can aggregate activity data at the WBS level and evaluate it.

A WBS is a model of a project and shows the project activities to be carried out in a hierarchical structure. The various work packages in the project are described as individual work breakdown structure elements (WBS elements). You can divide these WBS elements at various levels until you reach the level of detail you require. Since the WBS is structured hierarchically, the data can be summarized and displayed at the corresponding higher-level WBS elements. In this logistics project, the WBS elements aggregate the data planned and calculated in networks and are used for revenue planning and project stock.

You assign organizational units such as company code, business area, profit center, and plant for each WBS element. Before you create a WBS, you have to create a project definition. The project definition is a framework for all the objects created within a project. The project definition contains data that affects the entire project (for example, start and finish dates, organizational data, and planning parameters). It contains default values that can be passed on to the WBS elements.

The controlling area that you specify when you create a project definition is unique for the entire project. You specify the controlling area just once when you create the project.

A project can generally be divided into phases, as shown in the figure, Phases in a Project. A high degree of precision is required when planning and coordinating large and complex projects. When planning the flow of a project, you schedule deadlines and dates, make resources available, and assign funds. SAP PS gives you the support that you require throughout all phases of the project.