Example: Creating a Costing Model for Projects (SAP Library

Example: Creating a Costing Model for Projects

Initial Situation

Your company frequently handles projects in which supply ditches are dug, pipes laid, and the ditches filled in again. These projects vary according to the size of the ditch and the diameter of the pipe.

Prerequisites

For this example, the following data must be available in the system in controlling area 1000:

In Customizing (Cross-Application Components ® Classification System ® Characteristics ® Define Characteristics Groups) the characteristic group Banks has been created for you (Banks). You use this group to flag the characteristics that you created.

Cost center 4298 (engineering) with activity types 1420 (machine hours) and 1421 (labor hours)

Cost element 420 000 (direct labor costs)

Materials PIPE 10 and PIPE 20 (Logistics ® Materials Management ® Material Master ® Material ® Create (General) ® Immediately)

Creating the Costing Model

An overview of the steps needed to create a costing model is provided under Editing Costing Models and Assigning Attributes.

Choose Logistics ® Project System ® Basic Data ® Templates ® Models for Easy Cost Planning. Choose on the right-hand side of the screen. Create costing model DITCH_A with the description Ditch of category A.

Assign characteristics to the model. To do this enter the respective name under Characteristic name in the table in the bottom right of the screen, and choose Continue. This way you access the transaction for creating the characteristics. When you have created a characteristic, save it and create the next one.

Create the following characteristics and attributes:

Name	Description	Data Type	No. of Places	Decimal Places	Unit of Measure	Temp- late
DITCH LENGTH	Length of ditch	Numeric format	4	1	M	__,_
DITCH WIDTH	Width of ditch	Numeric format	2	1	M	_,_
DITCH DEPTH	Depth of ditch	Numeric format	2	1	M	_,_
DURATION	No. of required days	Numeric format	2	0	Days
FLAT RATE	Travel costs flat rate	Currency format	4		EUR
PIPE	Supply pipe	Character format	20

You can only define and change the attributes when you maintain the characteristics. To change a characteristic, choose in the table.

For all characteristics, choose Characteristic group Banks.

Set the indicator Entry required for all characteristics. If you also want to use the model for projects that do not involve the laying of a pipe, do not set the indicator for the characteristic PIPE. The cost planner should not select a value and no costs will be calculated.

Define the following values for the characteristic PIPE:

Characteristic value

Description

1

Diameter 10 cm

2

Diameter 20 cm

For more information, see Creating and Assigning Characteristics.

The entry screen appears in the cost estimate as below:

This graphic is explained in the accompanying text

Click on the node Define the derivation rules (template). Select WBS element under Reference object. Enter the following lines in the template:

In the Type column, select the item category for the template using the input help. Use the input help also in the Object column and call the formula editor in the Quantity and Activation columns by double-clicking in the cell, if characteristics are being used.

Type	Description	Object	Quantity	Activation	Price
Cost center/ activity type	Labor costs for the digging of the ditch	4298 / 1421	DITCH LENGTH * DITCH WIDTH * DITCH DEPTH / 10
Cost center/ activity type	Machine costs for the digging of the ditch	4298 / 1420	DITCH LENGTH * DITCH WIDTH * DITCH DEPTH / 10
Material	Supply pipe	0001 / PIPE-10	DITCH LENGTH	PIPE = ‘Diameter 10 cm‘
Material	Supply pipe	0001 / PIPE-20	DITCH LENGTH	PIPE = ‘Diameter 20 cm‘
Cost center/ activity type	Labor costs for the laying of the pipe	4298 / 1421	DITCH LENGTH / 5	PIPE = ‘Diameter 10 cm‘ OR PIPE = ‘Diameter 20 cm‘
Cost center/ activity type	Labor costs for the filling in of the ditch	4298 / 1421	DITCH LENGTH * DITCH WIDTH * (DITCH DEPTH -0.1) / 10	PIPE = ‘Diameter 10 cm‘
Cost center/ activity type	Machine costs for the filling in of the ditch	4298 / 1420	DITCH LENGTH * DITCH WIDTH * (DITCH DEPTH -0.1) / 10	PIPE = ‘Diameter 10 cm‘
Cost center/ activity type	Labor costs for the filling in of the ditch	4298 / 1421	DITCH LENGTH * DITCH WIDTH * (DITCH DEPTH -0.2) / 10	PIPE = ‘Diameter 20 cm‘
Cost center/ activity type	Machine costs for the filling in of the ditch	4298 / 1420	DITCH LENGTH * DITCH WIDTH * (DITCH DEPTH -0.2) / 10	PIPE = ‘Diameter 20 cm‘
Variable item	Travel costs	420000 / H	DURATION		FLAT RATE

For further information, see Defining Derivation Rules.

Result

You can now use the costing model to plan the costs for WBS elements. Assume that you have a project to develop a residential area and one of the WBS elements for the project is Lay Supply Pipe in Tony Benn Street. You can call up Easy Cost Planning for the project, select the WBS element node, and then choose planning form DITCH_A. After you have entered the data for Tony Benn Street and chosen Confirm, the costing results are displayed in the Costing Structure screen area. For more information, see Using Easy Cost Planning and Easy Cost Planning in the Project System.

Characteristic value	Description
1	Diameter 10 cm
2	Diameter 20 cm