PLANNING FUNCTIONS have been available in CO-PA ever since we know it.
Planning is a key tool available in Profitability Analysis (COPA), which is widely used to plan for the annual forecast for Profitability Plans and track the actual against the planned figures. Planning in Profitability Analysis allows to plan Sales, revenue and profitability data in any selected profitability segments. The planning data can be displayed in various ways, depending on business demands. It is not a standalone component. It can not only send data to another applications but it can also receive planning data from those applications. It is also not limited by any specific time frame. The planning can be done more than one fiscal year at one or on a rolling basis. The data can also be planned by posting periods or calendar weeks. It is also possible to create and store planning data in different plan versions.
In the newer SAP releases, you have to define what you want to plan before you actually do your planning. You have to set up a planning framework, select characteristics to be planned and that you want to plan with, and create planning packages in order to define your task areas. In doing so, you give those persons tasked with planning the framework in which to do the planning. You also define precisely the planning methods that these planners may use. You define all of this in customizing — that is, you make these settings in the test system and transport them to a quality assurance system before transporting everything to your live system. Any changes that you make, even if these are only in individual characteristic values, they are customizing-specific and must be transported.
You may think that sounds complicated — how does it tie in with a quick guide or a convenient way of planning in CO-PA? In principle, the procedure described is correct and useful for large companies in which many people are involved in the planning process. But what if you work in a smaller company that has only a few controllers who have to plan in CO-PA, you only have a limited amount of time in which to do the planning, but still have to integrate change requests from management in the planning quickly and efficiently? The planning phase is usually an adjustment phase, i.e., you create the planning according to specific requirements and then constantly adjust it until you achieve a desired or practical result. In this phase, fast planning is important: management often does not have time to wait days or weeks for planning changes.
Below we shall see the planning in CO-PA. We will assume that we want to create the planning for next year, and not only a sales quantity planning, but also planning right down to the contribution margin. We will also perform this planning not only at a high, aggregated level (e.g., company code or sales area); for each individual customer, we will plan with those products that you believe your customer will purchase next year. We will plan all customer-specific and product-specific characteristics as well. We will also consider individual monthly distributions. We will assume an overall planning process of approximately four weeks.
Your management will often tell you that you only have a few weeks for planning, and that the results of the planning (that is, the quality of your work, not the planned operating profit that management wants to achieve for next year) should be at least as good as the previous year, but preferably even better than last year. How can you shorten the planning process? In principle, you would enter sales quantities for the periods to be planned and valuate these with prices, conditions, and cost rates. You would then consider the result, and in a frequently recurring process, would change details such as sales quantities, prices, conditions, or cost rates until a desired or practical result is achieved. There is no way of shortening the process, is there? Of course there is!
Initially, management is interested in the possible operating profit for the planning year. How the profit is spread over the individual months of the planning year is initially irrelevant. This is the first approach that you use to shorten your planning process: you plan your entire year’s planning in one plan period, i.e., one planning month. You can spread it over the months of the year later.
Entering the planned prices, planning conditions, and planned cost rates that you want to use to valuate the planned sales quantities involves a great deal of work. Many people do this work before management gives the go-ahead for planning, especially if planning is to be done on characteristics such as customer or product. Why not use prices, conditions, and cost rates that are already in the system, i.e., actual prices, conditions, and cost rates valid now? Then you would only have to enter planned sales quantities and valuate these with the actual prices to get your first result. You can then make specific changes to the existing planning where sales quantities have to be adapted, or where higher prices, conditions, or costs are anticipated (or feared) until you get the result that management wants.
You can also save time when entering the planned sales quantities. Usually, the sales and distribution department or key account management will plan the planned quantities. If you are the sales controller responsible, they will ask you for historical values for past sales in order to plan, where applicable, the sales quantities for respective key accounts on the basis of specific product groups (ideally, specific products). It is up to you, how you provide these historical values. Many companies use Microsoft Excel; others use various management information systems, CRM systems, etc. Let us assume you use Microsoft Excel and also receive the data from your sales colleagues via Microsoft Excel. We would then use the historical values (e.g., the previous rolling year) to download the sales quantities for specific customers and products to Excel and also transfer other characteristics such as key account or product group. Using a pivot table (controllers will know what I mean), put together the sales quantities for each customer hierarchy and product group at customer/product level. Now use VLOOKUP to assign the planned quantities from your colleagues.
Using a manual planning layout defined in CO-PA, ideally you import the planned quantities for the specific customers and products via the batch input program. As a result of the characteristic derivations that you have set up for customers and products, all relevant characteristics are derived, meaning that you see all planned quantities on all possible characteristics. It is easier to explain the last planning tip with an example: Your key account managers give you the planned quantities that you see in the table:
Example for planned quantities
From the rolling year (e.g., period 10 of the previous year up to period 9 of the current year), you have downloaded the quantities shown in Table below from the actual data:
Actual data of the rolling fiscal year
As a pivot table, this corresponds to the values that you can see in Table below.
Pivot table for the actual data of the rolling fiscal year
Therefore, according to Table above, we want to plan a total of 250 units. In accordance with the rolling year, this planned quantity is to be distributed proportionately to the corresponding customers and products. You can do this using the rule of three. This results in the following planned quantities (see Table below) at customer/ product level proportionately according to the rolling year.
Proportionate planning based on actual data
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