Planning involves thinking ahead and can be seen as a process of modeling future business activities. SAP BPC provides a powerful tool to support the budgeting, planning and forecasting process.
Goals for Budgeting, Planning & Forecasting
To improve the budgeting, planning and forecasting process, a number of goals can be identified:
- Align financial and operational plans with strategic objectives and goals
- Improve planning accuracy and efficiency
- Reduce budget, plan and forecast cycle time
- Spend more time on analysis and less time on transactional work
- Quickly model potential business strategies
- Gain confidence in financial results and reports
SAP BPC Helps to Streamline Budgeting, Planning and Forecasting
Some key characteristics of SAP BPC make it the tool of choice for streamlining the budgeting, planning and forecasting process.
Familiar and easy to use
SAP BPC enables rapid adoption by users by leveraging native Microsoft Office tools (e.g. Excel) and web browsers accessing. All data are stored in one central database and the application is user owned and managed.
Process-centric
Configurable business process flows guide users throught the business process step by step and drive process consistency and reliability.
Unified
SAP BPC is a single, integrated application reducing maintenance, improving data integrity, and simplifying deployment while enabling flexible planning & consolidation functions.
Business Process Flows
SAP BPC allow to define and sequence tasks for different departments. Users are guided step by step through the business process, reducing user training requirements. Managers can instantly see where everyone is in a process enhancing monitoring capabilities and improving timeliness. E-mail notifications are sent automatically to participants in the process to expedite progress. Different approval steps in the budgeting, planning and forecasting process can be coordinated by SAP BPC.
Data Input
Budget, plan and forecast data can be input in various ways. There is a choice of Excel, Word, Powerpoint and web interfaces. Existing Excel templates and planning schedules can be easily adopted and integrated into SAP BPC. By using native Excel functions, formatting, and formula preservation, training time and costs are reduced.
Plan data can be entered either manually or through an automated link to source systems. Existing plan or actual data can be used as the baseline for the planning process.
With SAP BPC 7.5 Netweaver existing SAP systems can be leveraged to achieve a high level of data integration. SAP BPC 7.5 Netweaver can be used to read and write data from and to SAP source systems (e.g. SAP BW).
Collaboration via Comments
Collaboration is of critical importance for an effective budgeting, planning and forecasting process. SAP BPC allows to annotate the data so that other users can view the comments. Users can add priority and keywords, comment history can be viewed, and an overview commentary report can be analysed.
Top-Down and Bottom-Up Planning
Budgeting, planning and forecasting is usually a process that combines top-down and bottom-up approaches. High-level plans, parameters and guidelines can be established and driven down to lower areas of the business. Flexible allocation rules can be automatically applied to allocate overhead costs and indirect expenses. Targets and strategic plans are held in the same unified application, to enable making comparisons to budget, forecast, actuals, etc.
Version and Scenario Creation
Users have the ability to quickly and easily create their own versions and "what-if" scenarios. Creating versions automatically copies the base amounts, drivers, statistics, etc. to allow immediate visibility into the fully calculated new version. Users can specify which elements from the source data should be copied. Source data elements, such as departments, versions, etc. are secured ensuring users only have access to data that is relevant to their area of responsibility.
Approval Process
SAP BPC automatically generates email notification to notify users when processes are ready to begin or require review. Business process flows enable compliance and ensure control in the process. Users are prevented from moving forward in the business process flow until appropriate review/sign-off is received.
Headcount Planning
Authorized users can track detailed information by employee. Salary increases are budgeted based on corporate guidelines and procedures. Users can be required to provide commentary when corporate limits are exceeded. SAP BPC will automatically calculate personnel expenses, such as taxes, insurance, etc.
Operational Expenses Planning
SAP BPC allows users to plan annual amounts, then spread over across time based on different methodologies including: even, last year, 4-4-5, growth/decline, or any other custom type. Users can capture additional detail per line item in a free form environment. Supporting details are captured and stored within the application, allowing greater visibility into planning methodologies.
Capital Expenditure Planning
SAP BPC will maintain global values for standard capital items. Users have the option of entering unit values which will calculate total capex spend based on global cost assumptions. Non standard assets can be entered free form by users and associated to a specified project, class, etc.
Balance Sheet and Cash Flow Planning
SAP BPC allows powerful modeling using drivers, including balance sheet drivers. Drivers can be defined for different locations and lines of businesses. Users can set targets for items such as DSO and DPO which will drive the respective accounts on the balance sheet.
Consolidation of Budgeting, Planning and Forecasting Data
As users enter information, data is immediately calculated & consolidated. Updated information is immediately available everywhere in the application. Variances due to exchange rate fluctuation can be easily separated from true business variances.
