Unit 1: How To Structure Part I

Week 2: Basic Tool Functions Part I
Unit 1: How to Structure Part I

How to Structure Part I
Overview
Organize your work Create your costing structure Experience the usability
▪ Projects, calculations and ▪ Different ways of creating a costing ▪ Costing structure maintenance
calculation versions structure ➢Efficiency
➢Flexibility ➢Openness
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Structure objects: project – calculation – version
▪ Projects organize calculations and versions for

product cost estimates and simulation. Project
Calculation 1 Version 1
▪ A project can contain any number of
calculations and their corresponding calculation Version 2
Calculation 2
versions. Component
Calculation 3 Material …
▪ Each calculation has at least one version, and
can have an unlimited number of calculation Component
Project
versions.
Version 1
Project
▪ Versions can be frozen. Re-Use
Calculation Version 1
▪ A version contains the costing structure with Version 2
the items to be costed. Legend
Project Version
Calculation Costing structure item

Structure object: project
▪ Provides project attribute inheritance to new

calculations and versions
▪ Determines the authorizations for the project

and the related calculations and versions
▪ Foundation for reporting and simulation

Structure object: calculation
▪ The calculation name and the controlling area

are defined for the entire calculation, and
therefore apply to all versions.
▪ All other data (such as total quantity, costing

structure, costs, several time stamps) can differ
between calculation versions.
▪ A version has time stamps to manage valuation

date and master data updates.

Structure object: version
▪ The costing structure makes up the hierarchical

structure of a calculation version such as bill of
materials and routings that contain the items to
be costed.
▪ Each item is assigned to an item category (icon

in costing structure tree).
▪ The item details are dynamic according to the

item category that is marked in the costing
structure.

Structure object: costing structure item
Item categories Item details
▪ Document, material, internal and ▪ General data, e.g. organizational data, and
activities, subcontracting, business comment field
process, resources and tools, variable ▪ Quantities and related Unit of Measure,
item, text item, referenced version e.g. total quantity, base quantity, lot size
▪ Different item details due to category ▪ Prices, e.g. variable, fixed, price unit, price
source, confidence level, multi-currency, local
content
Different ways of creating a costing structure
Import document structures, bills of materials (material BOM,

engineering BOM, order BOM, manufacturing BOM) , and
routings from SAP S/4HANA and SAP ECC
Import from Microsoft Excel
Create a structure from scratch, cut, copy, and paste items

within one and across different calculation versions
Integration across applications – flexibly adaptable to your needs
▪ Import a structure to create a calculation as ▪ Import from multiple systems

a whole, or to update an existing costing
structure at every level

Flexibly adaptable to your needs – integration across applications (examples)
R&D – optimize product development cost Sales – optimize quotation costing
▫ Extensibility example: Integration of SAP Product ▫ Extensibility example: Integration of SAP Product
Lifecycle Costing with SAP Engineering Control Center Lifecycle Costing with SAP ECC Sales & Distribution
(single repository for product data generated out of
different engineering authoring tools)

Flexibly adaptable to your needs – Machine Learning (example)
Plausibility Check Report
▫ Check your calculations quality by running the Plausibility

Check Report that is adaptable to the customer context
(SAP Engineered Service: Quality Checker and Plausibility
Check Report Extension)
▫ All items of a given calculation version will be checked based

on the patterns learned from historical calculation versions.
▫ Deviations from those patterns are anomalies, which indicate

potential errors, such as:
▫ Implausible material prices
▫ Implausible activity durations
▫ Missing items that are usually present under such
assemblies
▫ Unusual cost shares

System demo

Projects, calculations, and versions to organize your work

and as a foundation for reporting and analysis
Key Import bill of materials and routings from multiple sources

into one costing structure, greater data transparency and
Learnings consistency
Flexible and efficient maintenance: autocompletion, context-

sensitive editing, search, filter, highlighting, mass change, and
layouts, ease-of-use for complex scenarios

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The information contained herein may be changed without prior notice. Some software products marketed by SAP SE and its
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These materials are provided by SAP SE or an SAP affiliate company for informational purposes only, without representation or
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Unit 2: How to Structure Part II
How to Structure Part II
Overview
Manage structure objects Advanced structure objects Variant Matrix
▪ Cockpit view ▪ Lifecycle versions ▪ Define variant matrix

▪ Variants ▪ Simulate and calculate variant mix

Manage structure objects
▪ Manage your projects, calculations and

calculation versions and history centrally in the
Cockpit view
▪ Create, open, copy, rename, and search

features, and move calculation versions to
other projects
1
▪ Icons to identify structure object types
▪ Advanced structure objects: lifecycle versions, 2

variant matrix

Advanced structure object: project lifecycle
▪ Define project lifecycle volumes as well as

material and activity price surcharges
▪ Mass generation of the lifecycle versions

Advanced structure object: variant matrix
▪ Define variant matrix based on a base version,

the “super bill of material”
▪ Simulate and calculate different variant mix by

editing quantities and occurrence
▪ Compare all variants in one view, the “Variants”

view
▪ Create new variants based on existing variants

in the same variant matrix
• (Mass-) Generate new calculation versions
based on variants
▪ Visualize and accept changes in the variant

matrix after changes to the variant base version

System demo

Manage your projects, calculations and calculation versions

and history centrally in the Cockpit
Key Efficient costing and simulation of project lifetime calculations –

Flexible framework for planned demand and production volumes,
Learnings and material and activity price surcharges
Efficient costing and simulation of variant mix – Flexible

framework for calculating variants by editing quantities and
occurrence

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Unit 3: How to Create Master Data
How to Create Master Data
Administration view
Administration Cockpit
Maintain and Manage projects, calculations, and
manage all master calculation versions at one central
data and settings in place
one conveniently
structured view
My Home
Access the recently used calculation
versions with one click
Project Calculation
Manage the costing project details Create a costing structure from SAP
ERP, SAP PLM, Excel, other data
sources, or manually from scratch, and
analyze the cost breakdown

Sources of master data
1. Local Master Data 2. Replicated Master Data
Calculation Version-Specific
Master Data

Master data definitions in administration view
Costing and Analysis Finance

▪ Accounts, Account Groups, Material ▪ Controlling Areas, Company Codes,
Account Determination, Valuation Profit Centers, Business Areas, Cost
Classes, Overhead Groups, Costing Centers, Activity Types and Account
Sheets, Cost Component Splits Determination, Activity Prices
Logistics Global Settings

▪ Plants, Work Centers, Processes, ▪ Languages, Currencies, Exchange
Material Types, Material Groups, Rate Types, Currency Exchange
Materials (General Data), Materials Rates, Units of Measure, Material
(Plant-Specific Data), Material Prices, Price Sources, Activity Price
Customers, Vendors Sources, Global Default Values

System demo – Administration view

Using master data in calculations

Using master data in calculations

System demo – Master data in calculations

Master data: initial setup, regular maintenance Languages
price sources
currencies, units of measure
currency exchange rates and types
Some master data is mainly initially maintained controlling areas
company codes, plants
during system setup business areas, profit centers
▪ Important: specific sequence according to the accounts, account groups
activity types, processes, work centers
dependencies
overhead groups, valuation classes
component splits, costing sheets
global default values
material types, material groups
material data (general and plant-specific)
material prices, activity prices
customers, vendors
Other master data is frequently maintained material prices, activitiy rates

and new entries are added regularly. material (general data, plant-specific data),
customers, vendors
account groups
costing sheets, cost component splits
global default values
user-specific values
default values
Master data replication from SAP ERP
Almost all master data that can be

maintained locally can also be replicated
from SAP ERP
▪ Typically, only the fields of a master data object
are replicated that are relevant to product
costing with SAP PLC
▪ Further sources of master data and additional
source fields are planned to be added in the
future

Custom fields for master data (extensibility)

System demo – Creating custom field for master data

Which types of master data are used and where they come
from in SAP Product Lifecycle Costing
How master data is used in calculations
Key
How master data can be displayed, created, and maintained
Learnings
How master data can be extended by custom-specific fields

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warranty.
Unit 4: How to Calculate
How to Calculate
Overview
The calculation engine is the cornerstone of SAP Product Lifecycle Costing. To make best use of
the full product functionality, it is important to understand the main calculation algorithms and the
most important fields which influence calculated results.
Import the costing structure Calculate and save a first cost

from SAP ERP, Excel, or any 1 3 estimate as an initial basis
other data source such as
PTC Windchill, or manually
create the costing structure
Determine material and activity prices 2 4

according to defined pricing strategy, with Simulate cost estimates and create
SAP ERP, other source, or locally further versions with more detailed
maintained prices, or manually set prices and up-to-date price information
in a calculation
How to Calculate
How the system calculates
Calculation algorithm Quantity

▪ Bottom up calculation ▪ The total quantity is defined by the quantity for one
▪ System calculates using quantity (incl. UOM) for assembly in accordance with the base quantity and
one assembly * price (incl. UOM) * costing sheet lot size.
= total costs for item ▪ The unit of measure for the quantity is also
▪ Indicators are relevant such as lot size, base considered.
quantity, and other indicators
Currency Costing Sheet

▪ Currency types: transaction currency per item ▪ Second dimension to add costs to the structure
and a reporting currency per calculation versions ▪ Used to add costs (overhead costs) which cannot
▪ Reporting currency: currency used to calculate be assigned directly to an item based on a set of
the version total costs. The corresponding rules maintained in the admin view
exchange rates and types are taken from the
admin view based on the valuation date

How to Calculate
Calculation algorithm
Total
Quantity for X Base
Quantity Total Costs
Quantity per
UOM X ONE
Assembly x = and Total
Quantity
Price/UOM
/ Lot Size

How to Calculate
How a material price or an internal activity is priced
The system calculates each item based on its settings, e.g. if a material item has a material master price.
The sequence of the pricing strategy AND the validity of the material master price defines which price is
found for the item
Material Mat Plant Project Valid To Price
Internal Cost Controlling Activity Project Valid To Rate

Activity Center Area Type
▪ Material items: depending on PLANT or GENERAL entry in admin view and validity date
▪ Internal activity: depending on controlling area, details in admin view, and validity date

How to Calculate
How overheads are applied to the structure
The system calculates each item based on its settings, e.g. a material item has an account. The account
is assigned to an account group. The account group is used as an overhead base. The overhead base row
gets an overhead
Material Overhead
1
Material Controlling Plant Account*
Area
2
Account Account Overhead Base
Group
4
3 Costing Sheet
Overhead Overhead Amount /
Base Percentage

How to Calculate
Lot size and base quantity
1*10=10 10/3=3,3~4*10=40 1 PC fixed 10*10/3=33,3
Lot Size Base Quantity Fixed Quantity

The Lot size defines cost such as The Base quantity specifies the The Fixed quantity is a fixed
set up costs per lot. A machine amount you need for the quantity quantity, not taking the quantity
needs to be set up every 3 pieces. for one assembly. 10 min for 3 for one assembly into account.
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pieces per 10 assemblies. 7
How to Calculate
Activate/Deactivate – Valuation Date – Update Button
These items influence how the system calculates the results of the calculation
Activate/Deactivate Valuation Date Update Button
Activates or deactivates the item Determines prices and rates per Gets new prices and rates based
and thereby adjusts the total valuation date on valuation date and
costs recalculates

How to Calculate
How to cover investments and revenue
▪ Revenue for part customer-financed items can be entered as negative a value.

This value will influence the total costs. If you do not want this, you need to
deactivate the item.
▪ Investments can be created in the system using a separate account and the item
category “variable item.” Alternatively, investments can be created by using a
separate calculation version on project level.

How to Calculate
Where to find calculation information
Calculation information can be found in the side panel under the category “Calculated Values”
▪ Cost per total quantity = cost w/o overheads
▪ Total cost = cost with overheads

How to Calculate
System demo

How to Calculate
The system calculates bottom up, taking different indicators into

account
Different types of currencies can be used (reporting and
transaction currency)
The system provides several quantity fields that are relevant
Key for the calculation and can be influenced
Learnings
Costing sheets are used to add overhead costs to the calculation
Investments and revenue can be covered by the solution.

The automatic price rate determination defines the specific
total cost
Dependent on several entries (valuation date, plant,
controlling area, etc.) the total costs are calculated.

Thank you.
open@sap.com
Follow all of SAP

warranty.

Unit 1: How To Structure Part I

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Week 2: Basic Tool Functions Part I

Unit 1: How to Structure Part I

© 2018 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 2

▪ Projects organize calculations and versions for

© 2018 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 3

▪ Provides project attribute inheritance to new

▪ Determines the authorizations for the project

▪ Foundation for reporting and simulation

© 2018 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 4

▪ The calculation name and the controlling area

▪ All other data (such as total quantity, costing

▪ A version has time stamps to manage valuation

© 2018 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 5

▪ The costing structure makes up the hierarchical

▪ Each item is assigned to an item category (icon

▪ The item details are dynamic according to the

© 2018 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 6

Item categories Item details

Import document structures, bills of materials (material BOM,

Import from Microsoft Excel

Create a structure from scratch, cut, copy, and paste items

Integration across applications – flexibly adaptable to your needs

▪ Import a structure to create a calculation as ▪ Import from multiple systems

© 2018 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 8

R&D – optimize product development cost Sales – optimize quotation costing

© 2018 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 9

Plausibility Check Report

▫ Check your calculations quality by running the Plausibility

▫ All items of a given calculation version will be checked based

▫ Deviations from those patterns are anomalies, which indicate

© 2018 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 10

© 2018 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 11

Projects, calculations, and versions to organize your work

Key Import bill of materials and routings from multiple sources

Flexible and efficient maintenance: autocompletion, context-

© 2018 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 12

© 2018 SAP SE or an SAP affiliate company. All rights reserved.

Manage structure objects Advanced structure objects Variant Matrix

▪ Cockpit view ▪ Lifecycle versions ▪ Define variant matrix

© 2018 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 2

▪ Manage your projects, calculations and

▪ Create, open, copy, rename, and search

▪ Advanced structure objects: lifecycle versions, 2

© 2018 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 3

▪ Define project lifecycle volumes as well as

▪ Mass generation of the lifecycle versions

© 2018 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 4

▪ Define variant matrix based on a base version,

▪ Simulate and calculate different variant mix by

▪ Compare all variants in one view, the “Variants”

▪ Create new variants based on existing variants

▪ Visualize and accept changes in the variant

© 2018 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 5

© 2018 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 6

Manage your projects, calculations and calculation versions

Key Efficient costing and simulation of project lifetime calculations –

Efficient costing and simulation of variant mix – Flexible

© 2018 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 7

© 2018 SAP SE or an SAP affiliate company. All rights reserved.

© 2018 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 2

1. Local Master Data 2. Replicated Master Data

© 2018 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 3

Costing and Analysis Finance

110=10 10/3=3,3~410=40 1 PC fixed 10*10/3=33,3