Discovering SAP’s Grouping, Pegging, and Distribution(GPD) – Distribution

Welcome to the third blog of the series on understanding GPD – Distribution.

Part 1 – Grouping

Part 2 – Pegging

The purpose is to help gain a high level understanding of how distribution component functions within SAP GPD.

Distribution – distributes the individual / actual costs from the Group WBS elements (grouped replenishments) back to the individual WBS elements (original requirement). It picks up the quantities assigned during pegging for which the costs are to be distributed.

It is a common approach to use Production Orders, Purchase Orders as the objects where the actual cost distribution could be made from, while the list could also include:

• Commitments and Payments
• Stock Values
• Valuated Stock

Pre-requisite:

1. WBS elements are assigned to Group WBS element.
2. Distribution profile for the Group WBS element to define the values to be distributed.
3. Requirements planning is executed.
4. Pegging against the appropriate

Application:

Customising: SPRO→ Project System → Financials → Period End Closing → Single Functions → Distribution

While distribution could be implemented for both valuated and non valuated stock, SAP recommends not going for valuated stock due to business process and technical complexities.

For non-valuated stock, goods movement do not have values and the overall costs are still associated with the Group WBS elements. Distributed values can then be used further for processes such as resource-related billing, surcharge or discount settlement. Only GPD distributed costs should be billed to the customer.

Below image highlights the difference mainly between Internal Procurement (Production Orders),  External Procurement (Purchase Orders) and the value distribution that it can have. We will leave Valuated stock out of scope for this blog.

Source: help.sap.com. (n.d.). SAP Help Portal. [online] Available at: https://help.sap.com/docs/SAP_ERP_SPV/cfff13ea14f3430488af41bbc02dbb69/18f5c353b677b44ce10000000a174cb4.html.‌

Two major limitations of distribution are:

1. Once you distribute the costs for a specific period, distribution cannot be re-run for the preceding period.
2. Distribution run cannot be cancelled.

Summary:

Distribution, based on pegged proportions distributes the costs. The process supports both valuated and non-valuated project stock. Overall, GPD could be quite complex and may not support all the desired processes. Project Manufacturing Management and Optimisation (PMMO) offers several benefits over GPD component in S/4 HANA. Please refer to some of these SAP notes as a starting point for PMMP offerings.

3030517 – SAP S/4HANA 2021, Project Manufacturing Management and Optimization: Restriction Note

2928343 – Data Migration from GPD on S/4 HANA to PMMO

Thank you for checking this blog.

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