Issue

Project time and budget management are the key performance indicators of effective project management. Syensqo's project management procedure requires the project managers to deliver the projects on time and under budget. Budget management and cost tracking is performed in the ERP (WP1 and PF1) SAP applications and Colmar but dates and schedules are managed offline. There is no integration of project tasks, dates nor duration with ERP project. Each GBU have their own rules for managing project tasks and are managed in various applications such as Google Sheets, Microsoft Project, Primavera etc. The lack of Integration of project information (dates, schedules etc.) leads to inefficient and un-reliable decision making for budget allocation. In addition manual efforts are required to co-ordinate between financial controllers and Project managers in order to deliver the project on time and on budget.

This KDD intends to evaluate potential solution options required for effective project schedule management integration with project financial management.

Recommendation

Based on the analysis and evaluation presented in this document, Integrate with Project Schedule Management (Automatic) (Option A in this document) is recommended to have an automated integration between the project accounting and project tasks and schedule in order to effectively manage the progress tracking of projects. This KDD emphasizes on standardization of project schedule management process supported by standardized application (solution).  A number of existing applications will be replaced by a suitable standardized application (this will be determined in detailed design).  The recommended integration can be with a selected project schedule management data within SAP or  within a 3rd party application.

Background & Context

Schedule management in project management lifecycle is the process of planning, developing, controlling, and monitoring project timelines to make sure that tasks and activities are completed on time. Currently in Syensqo, 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. 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).

The lack of standardization leads them to have no real direction or guidance on which tool, platform or application they should use. Most importantly, none of the tools used currently have any integration 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.

Opportunities

Integrating a standardized 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  (i.e. Industrial solutions, R&I, IT)
• Standardized project schedule management process and application will be required for the seamless integration
• The detailed management of project tasks, schedules, and resources are based on the complexity of the project to provide the flexibility and ease of management
• Analysis & assessment of the various applications (Microsoft Project, Primavera, SAP etc.) for detailed schedule/dates management will be done in detailed design.
• This integration can be with 3rd party application (Microsoft Projector Primavera) or internally with in SAP.

Constraints

Analysis & assessment of the various applications (Microsoft 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.

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

Business Rules

Detailed business rules will be determined during detailed design phase to standardize and integrate with Project financial management application (S/4HANA EPPM).

Options considered

Option A: Integrate with Project Schedule Management application (Automatic)

Project schedule/dates are critical to 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 Microsoft Project.

Benefits of Integration

• 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. Manually input and update the project financial management (i.e. SAP S/4HANA EPPM) for project start and end dates. Business rule 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.

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)	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	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 updates
Accuracy & data integrity	Automatic interface improves data integrity and ensures accuracy of information due to seamless integration	Manual process compromises data quality and integrity

See also

KDD003 - Integrated Project Portfolio Management Solution

Change log

Workflow history