A common project life cycle and basic terms in PS module

This article is to describe the common project life cycle and explain the terms & common process steps in SAP PS.

Major functionalities of SAP PS:

• To map the real project to the SAP system by means of WBS element, Network, Activity…

• To plan project in terms of costs, time, resource

• To control budget for project

• To manage the execution, or the project running, to ensure the project run smoothly as plan

• There are many kinds of report that can be used at each phase of a project to see the plan, actual and comparison.

Below is a common project life cycle in SAP PS:

Details:

•      Requirement: there are 2 major kinds of requirement and they lead to 2 major kinds of project: internal and external.

• If the requirement comes from inside company, we create an internal project. It might be a development project, an R&D project, or an Investment project… This kind of project doesn’t have revenue.
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• If the requirement comes from outside company, we create a customer project. It might be a construction project, or a production project, to build up products for customer. This kind of project has revenue and the involvement of SD module (project might be created from Sales order, and the billing might be linked between PS & SD).
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•         Project creation: the project creation is to build an appropriate structure of project by means of WBS element, network, activity, milestone, material…

•          Project planning: to plan costs, time (begin, end, relationship, duration…), resource (which activity will be performed  at which work center)

•          Project budgeting: to plan budget for project. The budget then will be used to control. System will give warning, or not allow any transaction that lead to the excess of the project budget.

•          Project execution: the project execution phase, we might do the procurement for project (integration with MM module), production for project (integration with PP module), costs booking (integration with CO module) and confirmation of network activity (confirm the plan data – that the work has completed).

•          Period-end closing: at the period-end we need to settle the costs to appropriate objects (cost center, asset under construction…). Result analysis and several reports might be run to compare the plan/actual and to forecast/adjust.

•          After finish the project (both logistic and financial aspect) we set the project status to “Close”.