SAP BPC Activity flow An overview!

By Corporate Performance Intelligence

Large part of professional life; I continued to wonder what is the difference between Planning
and Forecasting? How are they different? Asked many and never found a suitable answer, until I
studied chartered accounting. Answer is not much. Planning is a combined terminology used
for the Monthly & Quarterly process of Forecasting and annual process of Budgeting. Just a
term, thats all.
There is a BIG difference between BPC and all other planning tools, SAP has ever produced, in
terms of features, in terms of technical options, in terms of data granularity with which planning
can be done, seamless integration between planning functions, integration of planning &
consolidation, and most importantly empowerment of the business departments to manage the
planning process, without being too dependent on the project/support teams. BPC V10 is just an
incredible tool, in my opinion. Perfectly designed/fits to the need of large, complex, matrix and
global organization. Having said that; it also accommodates the need of SMEs, also quite easily.
So first thing comes into mind; what exactly is done in BPC? Answer is Financial Planning
of organizations. And in order to work out the financial planning; process has to touch upon
other plannings such as Sales Planning, Inventory Planning, Manufacturing planning.name
it
If I have to quickly list, activities takes place in BPC at a high level
Load data (actual from previous year, Forecast/Budget data from previous year) in BW
from source systems or ERP systems or external systems
Transform the data / prepare the data in BW, in a format required by BPC
Import the data into BPC and prepare the same by adding versioning, allocation, top
down, bottom up, type of data processing
Submit the final version of the data in various models or functions such as HR,
Overheads, Project systems etc
Transform (Smoothing process to make the data accurate & reflect a true view of internal
& external business situation/condition) the data using Script Logics or ABAP BADI
using DATA PACKAGES.
Version /Label the dataset such as Initial version, working version, optimal version,
pessimistic version, or other choose time based versions etcbefore using them further.
Once the initial versions of dataset are prepared, there comes the need of script logic,
which are required to help in the copy process, to apply various seasonality, to reflect
external conditions in the plan data, to calculate various rebates, discounts & offers etc,
Anything that your company participates in a normal business scenario can be integrated
into the plan data, automatically using script logics. Script logics can also be used for on-
the-fly-calculation (real-time) nature and also for obvious/automatic data transformations
such as currency transformation, consolidation etc at a chosen/scheduled time.
TRANSFER / REFERENCE the data between various model to help with
granular/aggregated planning and finally to the central model, where these data is applied
to the financial statements such as P/L account.
Check the correctness of the data by doing few tests and running few calculations,
accessing the projections WRT the previous financial years and current state of the
Actual world with respect to the running Budget/Forecast. Make amendments if
necessary (APPLY: trend analysis, apply a top-down number, incrementing numbers
based on micro/micro economic conditions of the market etc etc).
Submit the final version of Budget/Forecast.
Retract the data into BW or ECC if required for further processing and reporting purpose.
At this point in time, all types (Actual, Budget, Forecast) & up-to-date data is available in
BW centrally. And BW is a data warehousing system, which takes care of all complex
enterprise reporting needs, very easily with its array of tool-sets; such as: Business
Objects (WEBI, Crystal Reports, and Dashboard), BW-BEX, BW-WAD, Portal, and
Enterprise Portal.
Manage the submitted Budget/Forecast regularly; by comparing it with various internal &
external influencing factors.
Process for forecast is repeated once in every month or once in every quarter depending
on the need of the organization.
Process of Budgeting is repeated once in every year, for the next year.