Investment Planning 

Purpose

You can use this business process to define and model your strategic investment planning and to implement it throughout the company in the investment operational planning.

From the strategic investment planning point of view, the system offers the opportunity to define the scope of your investment strategy through strategic investment positions. It also helps you to produce a financial analysis of investment opportunities to steer your investment policy and support you in the decision making at company level. By integrating the effects on the contribution margin of an investment – through production capacity improvement for example – this process gives you the return on investment view that helps you in the decision making. This strategic investment planning is the foundation for the roll-out of the investment policy in your company.

From an operational point of view, the implementation of the investment strategy goes through the budgeting of investment position and the control of budget distributed to investment measures. It also includes an extensive planning of the investment measures and positions. By integrating the different elements that compose your investment structures, the process ensures the consistency of the values and allows a continuous adjustment between strategic and operational planning.

Prerequisites

Business Partner	SAP Application Component	Configuration
	ERP	Use SAP Solution Manager.
	SEM (optional)	Use SAP Solution Manager.

Process Flow

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       1.      Analyze investment opportunities

The opportunity analysis of an investment can be the first process step and supports you in the investment decision. This step reflects the impact of an investment decision on your business environment and helps you to optimize your investment decision. This step is optional and is part of the SEM-BPS content.

       2.      Elaborate Strategic Investment Planning

This process step enables the construction of a strategic investment planning in the system. Also known as Corporate Investment Planning, this process step describes the way a strategic planning can be broken down in the program structure to investment positions and transferred to operative planning in ERP. This step is also part of the SEM-BPS functions and supports, through retraction capabilities, the planning in the ERP components at program position level.

       3.      Structure the investment program

This process step aims at structuring your investment programs in the operational system. It allows a hierarchical presentation of a structured program. You can freely define this structure following your organization and your requirements. By assigning  investment measures to a program position, it is possible to aggregate  measures that plan values. 

       4.      Elaborate Investment Program operational Planning

The operational planning of the investment program is a process step describing the distribution of a strategic planning into the investment program structures and the preparation of an operational program planning. The planning can be done at program position level or directly at investment measure level. In the second case a roll-up of the values bottom-up enables the aggregation of planning values at investment program level. In both cases the availability of planning values at program position level then enables  a simulation of depreciation based on these values. 

       5.      Elaborate Investment Program Budgeting

Budgeting is the last step in the Investment Planning process. During this process, the rolled up plan values are corrected, if necessary, and then distributed top-down in the form of the budget to program position. Once supplied to budget, these values represent a budget availability against which an availability check can be done. Therefore they should be as accurate as possible. This process step is optional.

Result

Through this process you achieve a top-down or bottom-up budget elaboration for your strategic and operational investment planning. It allows you to breakdown your investment strategy to operational level.

The following steps are the investment decision and execution described in the investment management process.