If you talk to any planner in your organization, they will tell you that, planning generally begins at a high level. Once the figures are fixed at a high level, the planner needs to allocate/ disaggregate these figures to all subsequent levels. This ‘allocation’ is an important step in the planning process as the planned or budgeted numbers need to be rolled down to the lowest level of planning. There are many rules considered for this allocation. This blog discusses how SAP Analytics Cloud’s Planning Panel feature will help users by providing flexibility in the basic allocation process. This blog is based on SAC version 2021.6.
Planning Panel operations
Below are two different approaches followed when the planning team decides to perform the allocation.
- Distribute – Allocate values from a higher hierarchy level to a lower hierarchy level. The parent’s total value gets spread among all/ part of children – for example, Budget allocations from Region to City.
- Redistribute – Allocate values among the same hierarchy level. This process is preferred when you want to distribute budget values between various Region or ProductLine.
Consider a business scenario where the production team wants to plan the number of units produced for the upcoming quarter across each product line.
First, the planner needs a reference quantity that is expected to be produced next quarter. This can be taken from the last quarter’s actuals or the forecast/budget for the upcoming quarter. Planning Panel gives you the flexibility to input any number of your choice.
Note: A change in a single cell value will affect the lower hierarchy levels and higher hierarchy levels.
Second, the planner now will need to distribute these values from unassigned to assigned members as assigned members are the actual plannable objects.
Note: The SAC Planning Panel provides recommendations, smart suggestions based on table content. You can choose from one of the recommendations or manually select target cells from the table.
The Planning Panel allows users to either append or overwrite the distributed values and distribute them based on exact values, input weights, equally or based on a proportion.
How to use the Redistribute feature?
While the distribution feature helped to assign the unassigned values, redistribution helps to distribute the assigned values among cells in a user-defined way. The quarter’s value is equally distributed among the months, continuing with the scenario taken for the distribution feature (as above). In some manufacturing and retail industries, retail calendars (4-4-5 or 4-5-4) are used. To align with the 4-4-5 calendar (where October will have 5 weeks, November and December will have 4 weeks each), you must redistribute allocated values. This makes sure that your plan gets aligned with real-world scenarios.
Behind any final plan, there are hours of effort spent on data collection, data cleansing, data allocations, and multiple iterations of what-if scenarios. The simple, centralized features provided in the Planning Panel help the users spend more time finding insights than performing allocation and making the entire planning process simple and flexible.
Click here to evaluate if SAP Analytics Cloud is the right tool for you to take your reporting and planning to the cloud. If you are interested in learning more about SAP Analytics Cloud features, please check out our blog series here.