TOC Measurements with SAP Part 2

This is the second part of the first post TOC Measurements with SAP Part 1

Let´s continue with the second measurement OE (Operating Expenses)

OE (Operating Expenses):

The definition says that OE = all the money in the system that is spent in turning the investments into throughput. Again, there are plenty of procedures to get to these numbers. I chose the following approach with G/L accounts. (See Transaction FS10N).

     There are two selection options for accounts in my report. The first one is for accounts for investment(I) and the second one for operating expenses(OE). The reason is these accounts are needed for both measurements. The function module(FM) BAPI_GL_ACC_GETLIST delivers all accounts in the company which are then reduced to our selected accounts. See coding:

The next step is the loop sequence on the table with accounts and each account is evaluated with FM BAPI_GL_ACC_GETPERIODBALANCES. Values are added to columns with OE or I depending on the selection above. See my methods:

 

This section is about OE but we gain in this approach as a side effect also a part of Investment at the same time and therefore let´s move on Investment(I).

 

I (Investment):

The definition is that I = all the money the system invests in purchasing items the system intends to sell. In a simple way, it has two parts: Inventory (all materials) and Assets (machines, buildings etc.). Now, after having T and OE in place, we can use previous methods for building value for I. We have already got assets as a side effect by evaluation of OE. Now we have to add inventory in TOC sense and that means for unfinished goods and finished goods only their TVC part (without adding the value of direct labour). For raw materials, its price and quantity for the time period are stored in table MBEWH. In the same table are stored time period, quantity and price for unfinished and finished goods. That price must be replaced through TVC for one piece multiplied by quantity. TVC comes from the same method as in the case for T. See the complete coding:

 

C

Conclusion:

Having all three parts(T, I, OE) in one table, we can assess NP(NetProfi) and ROI(Return on Investments), or Productivity and Turns as shown at the beginning of this miniseries. It was the goal of our project, an easy way to evaluate the overall performance of a company according to TOC.

  I would appreciate any feedback especially if you use SAP in a combination with the Theory of constraint.

5 thoughts on “TOC Measurements with SAP Part 2

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