SAP HCM Personnel Cost Planning and Simulation

5,084 views

Published on

Planning personnel cost and headcount using the SAP HCM solution "Personnel Cost Planning and Simulation":
- Process in SAP HCM
- technical basics
- Centralised planning or involving browser based line manager tools
- Proven best practise for common scenarios and challenges in personnel cost planning and calculations
- Rolling forecasts

Published in: Business, Technology
0 Comments
4 Likes
Statistics
Notes
  • Be the first to comment

No Downloads
Views
Total views
5,084
On SlideShare
0
From Embeds
0
Number of Embeds
14
Actions
Shares
0
Downloads
355
Comments
0
Likes
4
Embeds 0
No embeds

No notes for slide

SAP HCM Personnel Cost Planning and Simulation

  1. 1. Personnel Cost and Headcount Planning in SAP HCM Peter Gilberg Sven Ringling iProCon Group SAP HCM Best practice Conference, London, 8th Nov. 2012 #HCMBP2012
  2. 2. www.iprocon.com Basic Approaches Do a Forecast counting each Penny Find the differences afterwards Punish the culprits Slide: 2 Create a Plan based of Forecast and business parameters Act according to your plan Improve planning quality through learning loop From: To:
  3. 3. www.iprocon.com Agenda ■ Personnel Cost Planning – Basics ■ The Planning Process ► Preparation ► Data collection ► Planning run ► Detail planning and data transfer ■ Selected Best practices Slide 3Session 4B - Personnel Cost Planning
  4. 4. www.iprocon.com How it fits into SAP HCM Slide 4 Session 4B - Personnel Cost Planning Cost- accounting Personnel Cost planning Organisational ManagementPersonnel master data Compensation Management Training & Events Management Quota Planning (sits in OM) Payroll Results BI (Business Intelligence)
  5. 5. www.iprocon.com What is it all about? • Payroll results • Master data • Organisational structure Forecast for personnel cost based on current information • Assumptions for the whole organisation • Apply to change forecast Applying scenarios • Line managers make changes according to business requirements • May comprise more than one planning cycle Interactive Planning Slide 5Session 4B - Personnel Cost Planning
  6. 6. www.iprocon.com Cost Item = Central Building Block Slide 6Session 4B - Personnel Cost Planning cost item wagetype symbolic account FI/CO account 0..1 0..n n..m • Using the symbolic account concept from payroll • 3 types: • Direct cost items: derived from data basis, e.g. Basic salary • Dependant cost items: calculated from other cost items, e.g. NI contributions • Additional cost items: created in planning run, e.g. Headcount or FTE Configuration BAdI Programming
  7. 7. www.iprocon.com The Planning Process in SAP Slide 7Session 4B - Personnel Cost Planning Planning preparation Data collection Planning run using business rules Detail planning (applying same business rules) Transfering results Framework and configuration Data basis from PA, PY, OM, T&EM Planning runs per scenario Agreed final plan version Integrated in SAP CO plans
  8. 8. www.iprocon.com Result of planning process Data basis Design principle: logic required in detail planning should not sit here Planning run scen. 1 Planning run scen. 2 Plan scen 2 after detail planning Transferred to plan version in CO module Planning run scen. 3 Plan scen 3 after detail planning Slide: 8
  9. 9. www.iprocon.com Agenda ■ Personnel Cost Planning – Basics ■ The Planning Process ► Preparation ► Data collection ► Planning run ► Detail planning and data transfer ■ Selected Best practices Slide 9Session 4B - Personnel Cost Planning
  10. 10. www.iprocon.com Planning Preparation Slide 10Session 4B - Personnel Cost Planning planning preparation data collection planning run Detail-planning transfer of results Implementation in SAP Configuration Development Define parameters Top management direction Statutory framework Collective agreements Scenarios
  11. 11. www.iprocon.com E.g.: Variations and scenarios Slide 11Session 4B - Personnel Cost Planning planning preparation data collection planning run Detail-planning transfer of results Scenario 2: „Recession“ Scenario 1: „Normal“ Bonus employees Bonus Execs Annual salary change EE subgroup 10: „Salaried employees“ EE subgroup 20: „Executives“ feature HCP01
  12. 12. www.iprocon.com Agenda ■ Personnel Cost Planning – Basics ■ The Planning Process ► Preparation ► Data collection ► Planning run ► Detail planning and data transfer ■ Selected Best practices Slide 12Session 4B - Personnel Cost Planning
  13. 13. www.iprocon.com Data collection Slide 13Session 4B - Personnel Cost Planning planning preparation data collection planning run Detailplanning transfer of results Purpose: data basis for all planning scenarios How: basic valuation of all relevant objects employee position Orgunit Quota PA: IT0666 OM: IT5010 Data basis = direct cost items
  14. 14. www.iprocon.com Employee Data ■ Data collection methods ► Infotype 0008 – basic salary ► Infotype 0014 – recurring payments / deductions ► Infotype 0015 – additional payments ► Difference between actual and planned pay ► Compensation guidelines (from compensation management) ► Payroll results (real or simulated) ► Simulated payscale change ► Data from training and event management ► Custom data collection methods (enhancement – often used for country specific payroll infotypes not included in standard, such as 0071 for UK pension schemes) Slide 14Session 4B - Personnel Cost Planning planning preparation data collection planning run Detailplanning transfer of results
  15. 15. www.iprocon.com Payroll results or master data?? How and why to use payroll results? • Posting run fills planning cluster • For future periods, this can be based on a simulation • Very tempting: looks accurate and no little extra config The downside: • If all comes from payroll, dependencies are not ‚known‘ to cost planning, so detail planning won‘t work • Master data and configuration for the whole planning period must be available so payroll can run • Performance issues (may run for hours or even days) • You may not have payroll for all countries running in SAP Blended solution • Often some elements are taken from PAST payroll results (e.g. overtime) as basis for forecast Seite 15Session 4B - Personnel Cost Planning planning preparation data collection planning run Detailplanning transfer of results
  16. 16. www.iprocon.com Filling data basis from payroll posting Slide: 16
  17. 17. www.iprocon.com Data Collection for Employee ■ Run Report (transaction PHCPDCEM) ■ Data collection ► Infotype 0008 – basic pay ► Infotype 0015 – Additional Payments ■ View Infotype 0666 „Planning of Pers. Costs“ ■ Manipulate data (transaction PHCPDCUI) ■ Delete data basis (transaction PHCPDCDL) Slide 17Session 4B - Personnel Cost Planning Demo Video on : http://ow.ly/f3GUy
  18. 18. www.iprocon.com Organisational Data ■ Data collection methods ► Infotype 1005 – planned compensation ► Data from connected objects (e.g. averages) ► Data for vacant positions ► Data from quota planning ► TEM (Training cost) ► Custom data (Enhancement) Slide 18Session 4B - Personnel Cost Planning planning preparation data collection planning run Detailplanning transfer of results
  19. 19. www.iprocon.com Putting a £-Sign to Vacancies Slide 20Session 4B - Personnel Cost Planning Infotype „Planned Compensation“ (Positions) Transparent High data maintenance effort One cost item only Jobs Transparent Low data maintenance effort Possibly several cost items Requires proper job catalogue Occupier No data maintenance Several cost items Not transparent
  20. 20. www.iprocon.com Agenda ■ Personnel Cost Planning – Basics ■ The Planning Process ► Preparation ► Data collection ► Planning run ► Detail planning and data transfer ■ Selected Best practices Slide 21Session 4B - Personnel Cost Planning
  21. 21. www.iprocon.com Planning run Slide 22Session 4B - Personnel Cost Planning Feel Good Inc. PCP CD ... planning preparation data collection planning run Detailplanning transfer of results PA: IT666 OM: IT5010 Planning run in Cluster PCL5 Cost items
  22. 22. www.iprocon.com Cost items Slide 23Session 4B - Personnel Cost Planning planning preparation data collection planning run Detailplanning transfer of results Planning run uses same data basis to calculate several scenarios. The result of the planning run are the dependent and additional cost items incl. key figures – added to the direct cost items from the data collection. • From data collection • Basis for dependent cost items • e.g. Basic salary Direct • Relative value based of other cost items • May have capping limit • e.g. Employer NI contribution, pension Dependent • Fixed value • e.g. Allowance for work clothing Additional • e.g. headcount • May depend on work percentage – e.g. FTE Statistical key figures
  23. 23. www.iprocon.com Planning Run ■ How it works ► Manage planning runs (transaction PHCPADMN) ► Perform a planning run ► Show results ► Delete plans (transaction PHCPPRMV) ■ Examples ► Dependent and additional cost items ► Valuation of vacancies ► Cost distribution Slide 24Session 4B - Personnel Cost Planning planning preparation data collection planning run Detailplanning transfer of results Demo Video on : http://ow.ly/f3H8y
  24. 24. www.iprocon.com Agenda ■ Personnel Cost Planning – Basics ■ The Planning Process ► Preparation ► Data collection ► Planning run ► Detail planning and data transfer ■ Selected Best practices Slide 25Session 4B - Personnel Cost Planning
  25. 25. www.iprocon.com Detail Planning Slide 26Session 4B - Personnel Cost Planning planning preparation data collection planning run Detailplanning transfer of results - Individual changes for each object (e.g. Employee) on cost item level - Options: - For whole plan done centrally - For orgunits done by line managers - Done in browser as BSP (old) or WebDynpro (new) - No Portal required - Can be integrated in MSS in portal Line manager Planning run in Cluster PCL5What makes this great? The rules for dependent cost items, whether in configuration or BAdI programming, are applied, whenever a change is made in detail planning. So, if basic salary is increased, NI is increased accordingly
  26. 26. www.iprocon.com Detail Planning ■ Examples: ► Salary change ► Headcount change ► Central budgets ► Organisational changes Slide 27Session 4B - Personnel Cost Planning Demo Video on : http://ow.ly/f3HqB
  27. 27. www.iprocon.com Transfer of plans Slide 28Session 4B - Personnel Cost Planning planning preparation data collection planning run Detail-planning transfer of results - Transfer into CO module - Cost items are linked to symbolic accounts - Symbolic accounts linked to GL accounts - Activity types only possible via modification - Creating budgets (CO as well as compensation management) - Transfer into BI
  28. 28. www.iprocon.com Agenda ■ Personnel Cost Planning – Basics ■ The Planning Process ► Preparation ► Data collection ► Planning run ► Detail planning and data transfer ■ Selected Best practices Slide 29Session 4B - Personnel Cost Planning
  29. 29. www.iprocon.com Selected Best Practices Slide 30Session 4B - Personnel Cost Planning • Absence Valuation • Plan vs. Actual: rolling forecast • Accumulate cost items • Manual maintainance of infotype 5010 Simplifying the process Higher quality in the results
  30. 30. www.iprocon.com Valuation of absences SAP standard can consider absences • But deletes all cost items for absence period of defined absences • In some cases, you want only some cost items deleted or change valuation Custom solution: • Selectively delete or change cost items in absence periods • BAdI HRHCP00_DC_COSTITEMS Slide 31Session 4B - Personnel Cost Planning
  31. 31. www.iprocon.com Having a plan Slide 32Session 4B - Personnel Cost Planning 0 5000 10000 15000 20000 25000 30000 35000 1 2 3 4 5 6 7 8 9 10 11 12 Plan Plan
  32. 32. www.iprocon.com Comparing Plan & Acutal Slide 33Session 4B - Personnel Cost Planning 0 5000 10000 15000 20000 25000 30000 35000 1 2 3 4 5 6 7 8 9 10 11 12 Plan Payroll
  33. 33. www.iprocon.com Create a rolling forecast Slide 34Session 4B - Personnel Cost Planning 0 5000 10000 15000 20000 25000 30000 35000 1 2 3 4 5 6 7 8 9 10 11 12 Plan Payroll Forecast
  34. 34. www.iprocon.com Accumlate Cost Items Seite 35Session 4B - Personnel Cost Planning Basic Pay Overtime Bonus payment NI Pension ER XYZbenefi s NI Pension ER XYZbenefi s NI Pension ER XYZbenefi s
  35. 35. www.iprocon.com Accumlate Cost Items Seite 36Session 4B - Personnel Cost Planning Basis Pay Overtime Bonus payment Basis NI and pension Transparent calculation Improved performance in planning run NI Pension ER XYZbenefi s
  36. 36. www.iprocon.com Manual Maintenance of Infotype 5010 ■ Some elements difficult to forecast based on existing HR data ► E.g. overtime depends on future business volume more than data from past ► Requires judgement from line manager ► Based on business data like sales forecasts ► Not assigned to particular employee Slide: 37 ■ Pragmatic solution: ► Estimate overtime volume and capture it directly in IT 5010 for department ► Also applicable for training cost, recruitment cost, entertainment,…
  37. 37. www.iprocon.com Further Proven Enhancements Recruitment Wave Simulated leavers • By age • According to contract end date in infotype 0016 Integrating pensioners • In SAP standard, they are not part of OM and therefore excluded from cost planning UK pension schemes: • Custom data collection method for infotype 0071 Get overtime and shift allowances from payroll • Selective reading of payroll results – may even shift to different periods (e.g. for overtime at Easter) UK NI calculation and BUPA without using payroll results Integration into Processes & Forms Seite 38 Session 4B - Personnel Cost Planning
  38. 38. www.iprocon.com Project examples Client Scope Time / effort Chemicals, 1,000 staff, UK + German subsidiary Pragmatic implementation incl. detail planning and BI, but no line manager involvement - 10 weeks - 15 consultant days Bank, Germany, 4,000 staff Complex implementation incl. detail planning with line managers and 3rd party CO interface - 9 months - 60 consultant days International organisation, 2,000 staff Complex implementation with many bespoke planning elements (e.g. recruitment wave) - 6 months - 50 consultant days IT service provider, 800 staff Building a pragmatic pilot without line manager involvement - 2 weeks - 5 consultant days Group of universities, >50,000 staff Full redesign and performance optimisation - 3 months - 20 consultant days Slide: 39
  39. 39. www.iprocon.com Questions? Slide: 40 s.ringling@iprocon.com p.gilberg@iprocon.de

×