Issue

Project time

Issue

Time and budget management are the key performance indicators of effective project management. Syensqo's project management procedure also requires the project managers to deliver the projects on time and under budget. Whilst the budget management and cost tracking is performed in the ERP (WP1 and PF1) SAP applications and Colmar, dates/schedule management is managed offline. There is Syensqo will perform project accounting in SAP S/4HANA EPPM (Enterprise Portfolio and Project management) for budget and financial management.  Project operational management ( tasks and schedules) are however managed offline. Currently, there is no integration of project tasks and its , dates & , nor duration with project objects in ERP. Project dates are managed differently as per GBU or the project managers Each GBU have their own rules for managing project tasks and are managed in various applications such as Google sheetsSheets, MSP Microsoft Project, Primavera etc. Lack of Integration of project dates and schedule leads to inefficient and un-reliable decision making for budget allocation. Manual efforts are required to co-ordinate between financial controllers and Project managers to deliver the project on time and under budgetIn some GBUs, the project planning and management functions are outsourced to a third-party engineering organization.

This KDD intends to evaluate the potential solution options required for effective project schedule management integration with project financial managementoptions to determine the sufficient level of integration (automated vs Manual) between project schedule and project financial management (S/4HANA EPPM).

Recommendation

Based on the analysis and evaluation presented in this document, Integrate with Project Schedule Management application (Automatic) (Option A External Schedule Management with manual update to S/4HANA EPPM (Option B in this document) is recommended for automated and effective decision making and progress tracking of the Projects. to allow for effective project accounting and financial management without compromising the ease and flexibility of project tasks and schedule management. This KDD do not challenge the requirement to have a user friendly and flexible way for project operational management using tasks and schedules as per project manager's/GBU's need. However, it recommends that the sufficient level of information ( such as the phase dates and WBS dates) are updated in S/4HANA EPPM adequately to address the risks due to delays on project and avoid financial impacts.

Background & Context

Schedule management in project management  lifecycle  is the process of planning, developing, controlling, and monitoring a project timeline timelines to make sure that tasks and activities are completed on time. Currently in Syensqo, the management of dates and tasks are managed in various applications this activity (Schedule management) is managed through various tools and it is up to the GBU and/or project managers discretion as to what tools are used to manage a project. Project dates/schedule are managed in various applications such a Google sheets, Microsoft projects or Primavera depending on the complexity and the nature of the project.   It is required to have flexibility that allows simple projects to have simplified plan and complex projects with several tasks and interdependencies.  However, these dates doesn't integrate with the Project financial management application (ERP WP1 or PF1) or process. 

There is a lack of integrated project schedule management with project financial management. If there is a variation of timelines or delays due to change in scope or other issues, there is no visibility of the impacts on project budget/costs in a timely manner. Accurate project forecasts cannot be done and therefore this leads inefficient and inaccurate decision making and delivery of the project.

Opportunities

The project managers and GBU's require the flexibility to allow simple projects to be represented with simple plans and more complex project to be represented by more comprehensive plans (to manage a multitude of tasks and dependencies).

Currently, none of the tools used currently have any integration (automated or manual) to the WBS structure in the SAP project in the ERP system. As an outcome of this, any variation in the timelines of projects or any delays (regardless of reason) are not adequately reflected in the project financials which in turn means that there is little to no visibility of the financial impact of such delays of changes. Accurate project forecasts are difficult to maintain which leads to poor or inaccurate decisions on the delivery of the projects.

The lack of sufficient level of information in Project financial management system (S/4HANA EPPM) causes delays in decision making and addressing projects risks in timely mannerIntegrating the project schedule management application with the project financial management process/application across Syensqo presents multiple benefits, including informed decision making, accurate and timely capitalization of costs, project tracking and timely delivery of benefits aimed by the project.

Assumptions

• SAP S/4HANA EPPM will be the primary project portfolio management application used for financial management of all types of projects (simple, medium or complex) in various domains such as domains  (i.e. Industrial solutions, R&I, IT)
• The detailed management of project tasks, schedules, and resources are based on the complexity of the project to provide the flexibility and ease of managementwill be managed outside S/4HANA in specialised tools (e.g. MS Project, Primavera), or generic tools (e.g. Google Sheets for very simple project), as based on prior experience, S/4HANA's internal tooling is not sufficient to displace non-SAP tools. 
• The information that is required for decision making and reporting in S/4HANA EPPM is based on periodic (weekly/monthly) updates at a summary level. Real-time information of the detailed task's status and staff allocation is not required by Syensqo.
• Analysis & assessment of the various applications (MSPMicrosoft Project, Primavera, SAP etc.) for detailed schedule/dates management will be done in detailed design.

Constraints

Analysis & assessment of the various applications (MSPMicrosoft Project, Primavera, SAP etc.) for detailed schedule/dates management will be based on detailed requirements and will determine the complexity of the integration required with project financial management application and process.determined in detailed design. 

Impacts

Standardization  - Requires standardization of process and application for Project schedule management

Data quality and migration - Requires consolidation, sourcing and cleansing of data from various applications for seamless integration

for different project types (simple, medium, complex)

Business Rules -  Business rules and discipline to be established for timely update of the projects in S/4HANA EPPM which will be determined by schedule management system

Data Migration -  Migrated projects will require enrichment of data to ensure sufficient level of scheduling information required for financial management is uploaded/migrated in S/4HANA EPPM

Business Rules

• Business rules and discipline will be established to update the dates of the project deliverables and phases periodically (weekly or monthly) in S/4HANA EPPM to address the financial impacts such as budgets , forecasts, capitalization in timely manner

Business Rules

• .

Options considered

Option A:

Automatic Integration of Schedule Management with S/4HANA EPPM

Project schedule/dates are critical to needed for the delivery of project objectives and benefits on time. Delay in the project can lead to delayed realization of the benefits and impacts the return on investments. Typically the project schedule/dates management are done at (granular) Task level whereas the project financial management is performed at the (summarized) key deliverables level using work breakdown structures based (WBS) on assets being delivered.   It is critical to get the right balance of information from project schedule management to integrate with the project financial management. Dates/duration of the detailed tasks are summarized and integrated with the Work Breakdown Structures (WBS) to determine the delivery of each phase or deliverable of project. SAP S/4HANA EPPM (Enterprise portfolio and project management) offers integration capability with different third-party schedule management systems such as Primavera or MSP Microsoft Project using EPC (Enterprise Project Connector).

Benefits

• Data Integrity between Schedule management and financial management
• Automated and less error prone

Considerations & Challenges

• Project schedule management structure must align with S/4HANA EPPM structure at summary level
• Project schedules must be maintained carefully in order to prevent breaking the ongoing integration with S/4HANA EPPM, requiring a high level of user education. 
• Complex 2-way integration required to ensure, changes are sync in timely manner
• Some sites and regions have outsourced detailed planning which makes detail planning and integration redundant for some GBUs/Sites

Option B: External Schedule Management with manual update to S/4HANA EPPM

External application will be used for managing detailed

• Allows optimized Work Breakdown structure as the details of Tasks and schedules are managed in project schedule management application
• Allows determination of accurate phase dates derived from the tasks dates and duration via interface
• Improves accuracy of forecasts based on derived delivery dates
• Timely capitalization of costs based on the accurate delivery dates
• Enables efficient decision making for budget allocation and updates
• Timely alerts lead to timely actions to mitigate issues and risks

Therefore, an interface with the project schedule management is required with SAP S/4HANA EPPM for seamless integration of Project financial management.

Option B: Continue as-is (Manual Update)

Continue using the existing applications for managing schedule and dates for tasks of the project as per project operational management needs. Manually Summarized input and update of the project financial management (i.e. SAP project phase/WBS dates is done directly in S/4HANA EPPM for project forecasting, progress tracking, project delivery, and capitalization. Appropriate project structure will be defined in S/4HANA EPPM ) for project start and end dates. Business rule to allow budget and cost tracking for the timely capitalization, reporting and delivery of Projects.  Business rules and discipline to be established to update the dates of the project deliverables and phases in timely manner. Due diligence and monitoring reports will be required to be developed to monitor the dates update.support the monitoring the project deliver and capitalization.

Benefits

• Optimized and simplified Project structure focused on  project financial management as the detailed operational management resides externally
• Allows flexibility and freedom to manage the detail project schedule/tasks/duration as per project manager's discretion.
• Appropriate schedule information at summary level resides within S/4HANA EPPM for effective forecasting of costs
• No integration complexity

Evaluation

The table

Evaluation

Table below outlines the comparison of the proposed options for effective integration of project schedule management application with SAP S/4HANA EPPM . - Project Financial management) application. 

Evaluation Criteria	Option A -

Integrate with Project Schedule Management application (Automatic)

Automatic Integration of Schedule Management with S/4HANA EPPM	Option B -

 

Continue as-is (Manual Update)

Automation & Efficiency

Automatic interface increases efficiency as there is no manual handling

  Manual and Error prone data

Audit trail

Clear audit trail of information updated by interface 

  limited & less reliable audit trail as there can be updates made at different times by different people Cost Initial cost of implementation 

External Schedule Management  with Manual update to S/4HANA EPPM
Flexibility	Less flexible as the detailed project tasks structure must align with S/4HANA WBS structure	More flexible as the details tasks management is independently managed as per project manager's/GBU's discretion
Integration Complexity	High complexity to manage the 2-way integration	No complexity as the updates are manual at a summarized level
Cost	High cost of implementation, licenses (for EPC) and on going maintenance of interface	No additional costs as the updates are manual

Ease of decision making Timely update of the dates enables timely actions for informed decision making such as capitalization of costs and Budget allocation Decision making completely relies on manual updatesAccuracy & data integrity Automatic interface improves data integrity and ensures accuracy of information due to seamless integration

Future Proof	Interface impacted due to external application upgrades	Not impacted by external system upgrade
Change and Training	Requires change and training for users to ensure project plans are created and edited in line with integration requirements, and technical monitoring/support.	Requires change and training to manage dates in timely manner in S/4HANA EPPM

  Manual process compromises data quality and integrity

See also

KDD003 - Integrated Project Portfolio Management Solution

Change log

Workflow history