SAP Enterprise Asset Management, Plant Maintenance and Design Engineering Hierarchies

HPC America has more client work to share. We're back at one of the largest utilities in the U.S., enhancing a control panel that we had originally developed a few years ago. The control panel comprises most of the functionality the utility needs to accomplish its day-to-day work, as well as manage outage or break down work using SAP Enterprise Asset Management (EAM).

We're now updating the "design engineering hierarchy" of the control panel. It enables users to select the type of work that needs to be performed, including any technical drawings to be attached, and with just a few clicks the program creates all of the required documents and manages their hierarchy. By using our custom design engineering hierarchy, the Plant Maintenance (PM) module's functional location and equipment master is updated timely and accurately without manual maintenance in SAP.

Replacing legacy CMMS with SAP Enterprise Asset Management (EAM)

A transmission utility company we work with has two separate legal entities, one for Operations and another for Administration. Operations uses ManagerPlus to manage the utility's assets and their maintenance. In order to integrate that data with Administration's SAP FI/CO solution running on ECC 6.0, we're migrating the ManagerPlus data to the SAP Plant Maintenance (PM) module. The end result will be a single, integrated system that enables Operations to manage its maintenance work through PM orders, which collect the hours and rates of the employees performing the maintenance work. The SAP EAM solution will enable maintenance planning, work scheduling and a complete functional location hierarchy for fully-integrated SAP EAM work management and logistics with SAP Financials. By leveraging SAP's deep integration, the utility plans to eliminate time-consuming re-allocations of invoiced O&M work from their separate operating company for streamlined and accurate costing for rate case support.

HPC America Wins Sonoma County Water Agency SAP ECC 6.0 Implementation

SAP implementation news: We recently signed a contract with Sonoma County Water Agency (Water Agency) to implement and host SAP ECC 6.0. HPC America will oversee the project and help the Water Agency to simplify its current business processes and prepare for future projects that require a robust Enterprise Resource Planning (ERP) infrastructure.

The SAP implementation will initially focus on enhancing critical, day-to-day business processes, including a streamlined time card entry for Water Agency employees, cost and overhead allocation to projects and funds, and a new order management system. Contractor billing, accounting for vehicle and equipment usage, and tracking grants the Agency receives will be addressed subsequently.

The SAP software and hosted servers will replace an IBM mainframe computer application. HPC America's hosted services will enable the Water Agency to take advantage of SAP's benefits without requiring an investment in new hardware and IT staff.

More news to follow in the coming weeks.

SAP Internal Order (IO) Settlement and the FERC module

We recently had a discussion about Internal Order (IO) settlement and how it impacts the FERC module. In one scenario, a utility uses allocation structures that assign multiple primary cost elements to single secondary settlement accounts. This process results in no alignment of final settled costs in a cost center between the source primary cost elements and the secondary settlement cost elements, which concerns some users. The configuration combines the standard FERC solution results with the final fund ID from the Public Sector (PS) solution.

A question was raised. What would happen if the allocation structures were changed so that all cost elements settle on themselves and eliminate the secondary settlement cost elements? How would that impact the FERC solution?

In this example, the change should not impact FERC. While we do look at the fund assigned to the receiving cost center for each IO, we don't care if the cost elements have changed or are the original ones. When an IO is charged with either primary costs (e.g., materials, contracts, and employee expenses) or secondary costs (e.g., labor and overheads) the FERC solution ignores the settlement transaction in CO altogether. So whether a composite cost element is used for settlement or the original ones are used, settlement is not relevant.

In another scenario, a utility is settling to the original cost elements. There will be more records in the database when crediting the original cost elements. Settlements (and any reversals) will therefore take longer to process. Another drawback to crediting the original cost elements is that it will be harder to find the amount of each cost element capitalized. So if you wanted to see total labor, you would have to look in cost centers excluding the CO settlement transaction—you couldn't simply use the G/L to find total labor, since only the net to expense can be found there. For these two reasons, most utilities use the design in the first scenario, in which one composite cost element is credited for labor, one for materials, etc.

For utilities considering a change in allocation structures, we recommend looking at the budgeting model to see if the budget should be assigned a different set of receiving cost centers from the ones charged for labor. In one scenario we know about, original cost centers receiving the work from the IOs make the CO cost flow very circular. This can confuse users trying to monitor the budget by cost element.

Institutionalize Meter-to-Cash with SAP Meter Data Management and Predictive Analytics

As utilities face an aging workforce — some analysts estimate 50% will be eligible for retirement in the next decade — it becomes even more important to institutionalize the meter-to-cash process. Done right, executive management will commission a cross-departmental team that looks into every piece of equipment and business process, to document what veteran staff know intuitively but haven't written down.

Within the scope of this significant endeavor, we see two SAP tools that can help utilities prepare for the imminent internal and external sea changes:

SAP Meter Data Management can capture AMI reads from various meter vendors (e.g., Itron and Lyndis+Gyr). This will help prepare for future regulatory tariff changes that require more time-of-use (TOU) metering rate schedule offerings to residential, commercial, and industrial customers.

Predictive Analytics (PA) enables a deeper utilization of Financial Supply Chain Management (FSCM). In our post-recession, high unemployment era, there is a real risk of increasing Days Sales Outstanding (DSO) and on-site collection efforts. Waiting until accounts are delinquent will only exacerbate this situation. Predictive Analytics helps illustrate the characteristics of customer accounts needing payment plans or optional payment methods, such as a push to credit card payment.

SAP World Tour - It's all about mobility, BI, and SOA

Last week, we attended a local event on the SAP World Tour. Key topics included the future of in-memory computing, computing in the cloud, and mobility. The clear message was that the future is all about the iPad, iPhone, Blackberry, and Android. It's NOT about the desktop. We should expect specific apps that distill SAP software down to core information relevant to each person who needs it, whenever they need it, along with the ability to act on it. Another big takeaway was that during the next decade, we’ll see technology to enable managers to collaborate better with one other both inside and outside their companies. The new middle manager will work with customers and suppliers in real-time, with technologies that remove any semblance of corporate walls.

This is consistent with another key theme we noted at the SAP for Utilities event last month: utility customers will ultimately receive better customer service through more effective use of BI, SOA, and mobile technology.

We expect to see more granular, powerful functionality based on user roles in the future. This will be driven by leveraging Business Objects, by new analytical tools that make captured information readily available and actionable, and by increasing use of mobile devices. Service Oriented Architecture (SOA) will facilitate third-party application integration with SAP while maintaining high security and enabling bi-directional flows of information that previously were not possible without far greater effort and expense.

Given these advancements, the right information will find the right users based on specified rules and real-time analysis of operations. Customers and field crews will be the most obvious beneficiaries of these developments . Work orders, for example, will change in real time based on actual need and geographic proximity, such that the four-hour appointment window disappears. Customers will get what they need faster and with less hassle, and utilities will make even better use of their resources.

SAP's Linear Asset Management and Operation Account Assignments

At last month's SAP for Utilities event we learned more about two specific enhancements in SAP Business Suite 7 that are particularly interesting to utilities. Linear Asset Management (LAM) for Plant Maintenance enables very granular documentation of assets like power lines and water pipes, such that maintenance (and associated costs) can be tracked to specific portions of the asset instead of the whole entity—for example, a segment of line between two mile markers, or a distinct vertical location on a length of pipe.

With Operation Account Assignments (OAM), utilities will gain useful functionality to assign multiple operational accounts to one work order. Tasks will be allocated to the right accounts, resulting in fewer order numbers, greater flexibility, and detailed information for Finance—without increasing complexity for the field. In fact, when properly implemented, we anticipate that crews will have an even easier time, as they won't have to think about accounting.

FERC's rational response to violations

In today's issue of APPA's Public Power Daily there's a brief article by Robert Varela on FERC's "rational responses" to violations and fines, in order not to jeopardize smaller utilities. This is consistent with our own experience with FERC on behalf of clients. We've also seen a similarly constructive attitude from RUS, which offers a bi-annual educational conference on accounting for utilities. Everyone seems to recognize that complying with FERC and other regulatory reporting requirements can be a challenge for resource-constrained utilities; the financial data needed either isn't readily available, or it's there but not in the right format. Stay tuned in the coming weeks for a special report on best practices for FERC and NERC compliance. Or take a look at our enterprise solution, which was recently certified by SAP.

GIS and SAP for Utilities

One of the presentations at SAP for Utilities that we enjoyed greatly was Elizabeth Mueller's on "GeoSynergy." The City of San Diego uses Geographic Information Systems (GIS) to improve customer service and increase operational efficiency.

By integrating GIS into its SAP EAM infrastructure, San Diego is better able to anticipate potential maintenance issues even before customers call to report problems. And when people do call in—for example, to report a street light outage—the City can pinpoint the specific lamp that's broken based on the customer's address, determine if it belongs to the City, and then repair it and close out the work order promptly. Huge ROI here.

GIS also helps field teams to work more efficiently by presenting the relative location of different work orders spatially; instead of relying on a basic list of addresses, crews can see their target sites overlaid on detailed maps, thereby making it easier to understand where to go next to make the best use of the day. We'd expect to see more utilities integrate GIS with their SAP systems to capitalize on opportunities like these, as the business case for them seem highly compelling.

SAP for Utilities conference 2010

We attended the SAP for Utilities conference in Huntington Beach last week, and were please to run into many colleagues and industry acquaintances. In the upcoming blog posts, we’ll discuss a few hot topics from the show that we found compelling.

In the meantime, allow us a bit of shameless self-promotion. SAP presented its new utility customers at the event, 25% of which HPC America helped win. This is a real testament to the fact that utilities trust our counsel and experience, and that we're able to collaborate effectively with SAP software sales teams.

SAP Certifies HPC Utility Financials Accelerator

We're pleased to announce that after several months of rigorous testing, SAP has certified our Utility Financials Accelerator (UFA) enterprise software as powered by the SAP NetWeaver® technology platform. HPC UFA is in operation at Navajo Tribal Utility Authority, Arizona Electric Power Cooperative, Trans Bay Cable, and Tacoma Power, and this latest validation of its effectiveness is gratifying. Read our full announcement about the SAP certification or learn more about UFA.

Adding new lines of business to SAP

We previously wrote about how ARRA has provided millions of dollars to utilities, which presents recipients with the challenge of accounting for those grants. Beyond that, many utilities in rural parts of the country are not only considering investing in their existing infrastructure, but also expanding into new lines of business, such as broadband services, which the FCC has specifically encouraged.

Adding a new business means that SAP will be asked to handle even more data, so its reach needs to be extended for both internal financial and external regulatory views. While every such project will entail customized steps, we see a few that are worth considering:

• Apply existing business processes to the new line of business. For example, in CCS (now CRB) add the new utility service to the customer's bill, while maintaining the existing services. Likewise, keep your existing reports, but simply add a new line to them covering the latest service offering.


• Turn on SAP's Business Area functionality, to subdivide the Chart of Accounts and create General Ledgers for each line of business


• Create dashboards for each line of business with Business Intelligence (BI) to put key financial and operational metrics within easy reach—including non-SAP data that management values for decision-making. Also consider pushing this information out to mobile devices for selected users who are often away from their desks.

We'll report further on this matter in the coming months as we assist HPC customers who are themselves expanding into new ventures.

Smart Meters and SAP AMI Integration for Utilities

Smart meters have been a controversial news topic during the last year. While the idea of monitoring and pricing energy usage by time of day as a means to foster conservation sounds good, in practice it's generated concern and even backlash. Allegedly inaccurate meters make the evening news, and consumers' lack of understanding of what the technology really means precludes a clear connection between their consumption and their meters.

While raising consumer awareness and managing expectations about smart meters will take time and concerted effort, one tool in particular stands out as being integral to that process. SAP AMI Integration for Utilities holds real promise for improved communication. It can be tied into billing to provide residential customers with more information about their energy consumption and resulting costs. It can be used to identify areas for improvement, for example by advising customers on ways to adjust their usage to decrease costs. Likewise, if the system detects a spike in usage, consumers could be notified and asked to identify the cause in order to understand, if not prevent, its future occurrence.

We're also expecting utilities to have to replace outdated systems with more sophisticated solutions that are compatible with unbundled services (and their associated costs). As regulators require a greater diversity of rate plans to support conservation, and as consumers come to expect utility options that meet their individual needs—much as they do from cell phone and cable television plans—utilities will need to measure, manage, and market their services in increasingly more granular terms.

You watch: we'll bet that 20 years from now we won't even remember how it was done before.

Sustainability and SAP - Start Measuring Now

In June, we outlined three different sustainability-related products from SAP: Carbon Impact, Sustainability Performance Management (SuPM), and Environmental Health & Safety (EH&S). We're anticipating that regulatory, political, and community expectations will drive utilities to increasingly embrace carbon reduction, and the first step to doing that will be to establish benchmarks based on historical data. (You can't change what you don't measure!) Utilities therefore need to start tracking generation and spend, ideally on a functional department level, and then get that data into SAP. It's not unreasonable to expect that management will be evaluated on its sustainability performance, such that IT, Power Plant, Fleet, and other department heads will have a vested interest in measuring their respective carbon footprints.

SAP Document Printing Optimization

One of our customers in the nuclear power industry faced daily headaches from printing critical documents with the stock SAP forms (SAPScript). The inherent limitations of that tool for formatting, processing, and development finally became too much to bear, and the customer asked us to develop a better solution.

We solved the problem with coded custom print layouts using Smartforms for key Plant Maintenance (PM) documents, including orders, maintenance plans, and notifications. These layouts allow advanced formatting enhancements that we take for granted in everyday word processing applications—such as indenting, bulleting, and macros to insert predefined text—but that are simply not possible with out-of-the-box SAPScript forms.

As a result of this work, our customer was able to achieve a number of important benefits, including more efficient document creation, formatting, and management; increased readability with fewer errors; and more consistent presentation within and across departments. In addition, the customer is now better able to comply with its regulator's documentation requirements, such as no orphaned signature lines. The Smartforms that we created prevent unwanted line breaks, and enable the utility to print important documents correctly the first time around.

Utilities and SAP Grant Management

The American Recovery and Reinvestment Act (ARRA) has directed hundreds of millions in stimulus funds to utilities, enabling new projects to get off the ground that otherwise would have never been considered.

What, then, does a utility do to track the grants it applies for and the funds it receives from federal or state agencies? Some utilities are tempted to use an Excel spreadsheet; it's easy to download SAP orders manually, and there's comfort in the application's familiarity. But what are the costs? Let's count them...

    1. Your data is static once you've downloaded it
    2. There's no drilldown functionality for detail support
    3. You can't exclude non-funded costs
    4. You can't summarize accounts into grantor categories automatically
    5. There's a serious risk of manual errors
    6. There's little or no audit capability
    7. There's no document repository

We could come up with additional reasons, but the bottom line is that Excel just won't fly with your external auditor—let alone your grantor, should they want to see how their funds were utilized.

There is a better way. SAP's own Grant Management (GM) module is ideal for tracking every grant dollar received, and it integrates seamlessly with your existing SAP infrastructure (including FM, FI, and CO in particular). GM displays each grant's lifecycle and status, and allows you to establish financial conditions, legal rules, and allowable project expenses.

After Grant Management is implemented, you'll be able to see a running total of the money remaining in each grant, plus have easy access to all of the details for each expense. This degree of transparency makes grant management a no-brainer, and we're recommending that many of our clients consider it seriously. In a future post, we'll get into some of the technical details you should know when implementing the GM module.

Case Study: SAP ECC 6.0 and Smaller Utilities

Trans Bay Cable (TBC) is a $500 million energy transmission infrastructure project chosen by the California Independent System Operator (CAISO) to provide reliable energy to the City of San Francisco. Selected over a number of alternate solutions, and running a lean operation with a very small staff, TBC LLC required an ERP system that would meet the same FERC reporting standards of traditional utilities.

The outcome? HPC America architected an SAP ECC 6.0 solution that delivered best-in-class functionality with the highest cost efficiency—illustrating a replicable model for other growing utilities that cannot rationalize conventional, big company SAP installations. Read the complete case study.

Part 3: Capital Expenditures and the FERC Module

Wrapping up our look at the FERC module and capital expenses, we'll use another real-world example.

Let's say we have not one, but two capital orders for the month. The first one has $1M in it. But the second one has $100K posted to it, and it settles to a cost center. Thus, the second order is expense by definition, because all orders settling to a cost center are expensed. Now, let's assume further that the order type is designed for expense. Furthermore, the order was created, but for some unexplained reason, the regulatory indicator never got assigned and was left blank.

When it comes time to run the trace, this second order, having no regulatory indicator, will still need to be translated to the FERC or RUS chart of accounts. The trace is designed with two back-up translation rules in such an event, as follows:

If the regulatory indicator is blank or invalid then:

1. The trace looks to the responsible cost center on the order.


2. If found, the regulatory indicator on the cost center (looked-up on CSKS) is used. This will most often be an expense regulatory indicator.

If there is no responsible cost center assigned to the master record on the order (table AUFK), then:

1. The regulatory indicator is assigned from the default indicator shown on ZFERCR010 (run using ZE_FERCTRACE.) This is the regulatory assignment of last resort.


2. The assigned default is set to CAPT for all instances.

Our second expense order in this example, having a blank regulatory indicator, would then trace the debits to the Holding Account, but would never get an offsetting credit. Why? Because the order is not going to be capitalized. Rather, the order really should have had another valid O&M regulatory indicator, but it was blank and went to 'CAPT' by default. So there in will sit in the Holding Account without ever getting an offsetting credit for the $100K.

What can you do about such a discrepancy? By looking at results by month, you may find a timing problem between what the trace is saying should be capitalized and when the direct post is seeing the actual settlement.

If you can verify that all five conditions for capital orders are validated, there may be at least one order each month that has a blank regulatory indicator. To pinpoint that, reverse one of the FERC periods for the given year in QAS. When re-running the trace, change the default regulatory indicator to another O&M regulatory indicator. Changing nothing else, run the trace, trace post, direct post, and drill-down as normal. Check the balance in the Holding Account for any change. If it changed, then one of the orders supporting the Holding Account was blank, causing the discrepancy.

Got it all straight? Good, this is not easy stuff. Thoroughly confused? Not a problem, we can help.

Part 2: Capital Expenditures and the FERC Module

Continuing our look at the FERC module, let's walk through a hypothetical example of the process it uses to settle capital expenditures.

Suppose we have only one capital order for the month. It has $1M of cost in the order prior to settlement. The trace will see the $1M in the order, check that the regulatory indicator is 'CAPT', and use the rule in the trace translation table to convert the $1M to the Holding Account. And there it will sit waiting for a credit. Since the FERC module cannot capitalize costs, it must park this amount somewhere until the CO module (the only SAP module that can capitalize orders) settles the $1M and sends a credit (via the direct post) to the Holding Account. The Holding Account will have a zero balance if the following occurs for this one order:

1. The order has an order type designed for capitalizing costs.


2. The order has the regulatory indicator 'CAPT'.


3. The order has a settlement rule sending 100% of the order costs to CIP or PIS on the balance sheet.


4. The order settles in the same month the charges were originally posted to the order.


5. No back-dated charges to the order occurred after the initial settlement (this can be assured by closing the prior period).

If these five conditions above are met, the Holding Account will be zero for the month in our example. But what if it's not? Stay tuned for Part 3.

Part 1: Capital Expenditures and the FERC Module

This is the first of a three-part posting about tracing capital expenditures and the SAP IS-U/FERC module (which as you may know, HPC America originally developed in 1994). We recently helped a customer troubleshoot some mystery data, and thought our approach would be worth sharing.

When utilities build a new generation plant, overhaul an existing one, or make some other type of capital improvement, the associated work orders are of course capitalized in SAP. The IS-U/FERC module uses a special account to trace all the labor, materials, outside contracts, and employee expenses to a single expense account&mdashwhat we'll refer to here as the Holding Account. Then, to capitalize (i.e., reverse) the costs in the Holding Account, the order(s) are settled, meaning the expense is credited and the capital account on the balance sheet is debited. This happens once at the end of each month.

The order settlement action creates an offset to the Holding Account used by the trace for capital orders. So, in theory, the Holding Account has a zero balance at the close of each month. When that is not the case, it's a sign that something is wrong. Stay tuned for Part 2 for advice on handling such a scenario.

So why doesn't the FERC module just trace to the capital account in the first place and forget about having to clear the Holding Account? Well, the FERC module is not allowed to capitalize costs. Only the Controlling module (CO) can do this. By having only one source for capitalizing costs, the FERC ledger will show the same net income as the natural account ledger used for Generally Accepted Accounting Principles (GAAP) reporting.

As such, the true purpose of the Holding Account is to ensure the total expense dollars are EXACTLY the same between the natural and regulatory (FERC or RUS) chart of accounts. The Holding Account is comprised of two sources: traced costs to regulatory indicator 'CAPT' (usually debits); and direct post costs (usually credits) for all capital orders that settle externally to the balance sheet to either Construction in Progress (CIP) or Plant in Service (PIS). These two sources - trace and direct - happen at different times, hence the difference in the account is always the result of these two processes.

Next time: a real-world example.

SAP Business Warehouse Queries with Virtual Key Figures

Today we're going to discuss SAP Business Information Warehouse (BW) query techniques for BW users, consultants, and developers.

As you may know, Virtual Key Figures are used to handle complex algorithms and logic within a Bex query. In this linked white paper, we outline a solution that HPC America developed for one of our utility customers to split (i.e. allocate) the common administrative and general costs and common customer accounts expenses in the FERC 900 series of accounts to electric and gas lines of business based on the percentages derived from two look-up tables using FERC account and year/period. It's impossible to achieve this in a regular Bex query, but our solution worked very well.

Since the query does not use the cache when the virtual key figures are used, it can get slow at times. That depends, of course, on the data volume of the cube (or multi-cubes) and other variables, such as the usage of aggregates.

If you're facing a challenging BW coding issue, don't hesitate to get in touch with us directly for some advice. Download the HPC white paper on Virtual Key Figures.

Sustainability and SAP

Many utilities are well aware of the importance of walking the talk when it comes to being good environmental citizens. With so many green initiatives either in the works or already completed, it stands to reason that organizing, tracking, and reporting progress is as imperative as the actions going on to make a business green.

SAP has addressed this with three key products:

1. Carbon Impact


2. Sustainability Performance Management (SuPM)


3. Environmental, Health and Safety (EH&S)

Carbon Impact is all about tracking and reducing a business' carbon footprint. Utilities that want to set an example for their customers to encourage energy conservation and purchases from renewable sources need to show how they themselves are "being green." They can do this by deliberately tracking their progress on environmental issues. The old saying holds true, "You can't change what you don't measure." SAP Carbon Impact is designed with this goal in mind. SAP acquired a company called Clear Standards Inc. to serve as a Web framework for businesses to organize their progress and report it to internal and external stakeholders. At HPC America, we're looking into greater integration between this solution and SAP ERP and SAP Business Objects, to facilitate updates through better automation.

SAP Sustainability Performance Management (SuPM) is an application for the gathering of data from a variety of sources within an organization. This is a business system designed for middle managers tasked with the execution of their company's policies and objectives to cut CO2 emissions and reduce energy consumption overall, in order to set an example for other businesses as well as the end utility consumer. The application is intended to help measure sustainability-related data and make it actionable, such that managers can transition from analysis to execution more easily.

SAP Environmental, Health and Safety (EH&S) is already part of the Governance Risk and Compliance GRC solution. For many SAP customers, EH&S may be configured and running—but utilities can look to it with renewed interest in pushing the functionality deeper into the organization for more comprehensive coverage.

Within these three solutions, we're anticipating that SuPM will take the spotlight as SAP customers look for a comprehensive tracking and reporting system for sustainability objectives.

What Makes a Rockstar SAP Consultant?

The diversity of talent within the SAP community is remarkable, from technical specialists and industry experts to problem solvers and instructors. We were recently speaking with a customer about his experience with SAP consultants, and I started thinking about what distinguishes the truly great ones. Obviously this depends to some extent on what you value in a consultant (again, there's so much diversity) but four attributes of SAP Rockstars stand out.

1. Rockstars are technically and functionally competent. They know all of the relevant coding languages used to solve SAP challenges. ABAP, BAPI, Java, WSDL, and Object Oriented Programming fly from their fingers. They understand SAP functionality and know how to configure many modules, too. Because they can pick the right tool for the job at hand, their solutions not only work well, but also are often more elegant.



2. Rockstars aren't fazed by vague requirements. In fact, they may even relish the challenge of developing a detailed spec or proof of concept based on an unwritten request mentioned in passing by the water cooler. This skill comes from a learned and/or intuitive awareness of what end users really want to achieve, and how to accomplish that in SAP.



3. Rockstars communicate effectively with everyone. When they're across the conference table from a Director, they talk ROI; an hour later over lunch with a developer, they get into coding and assurance tests. Both audiences feel understood.



4. Rockstars increase productivity and efficiency. As a result of their knowledge, flexibility, and communication skills, Rockstars make a hugely positive impact on a project's outcome. They may cost (a lot) more than less experienced counterparts, but their strengths translate into far more efficient decision-making and productive development. And that often pays for itself many times over.

The next time you're evaluating a team of SAP consultants, keep an eye out for the Rockstar among them; he or she could be just the candidate your project needs to succeed.

IS-U/FERC -- Without a trace!

If you're like many utilities running the SAP IS-U/FERC solution, you may be able to turn it off. Say what? That's right, turn it off and get even better data than you're getting now.

When you change the FERC setting in FERC_C8, you'll see options to treat secondary costs as primary. Changing CO activity types (normally secondary cost elements) to primary for FERC reporting allows you to support FERC account balances with labor documents from CO — where often the employee name, hours worked, and PM order number are found. Imagine that; for the first time, a financial analyst will see each utility employee charge to an actual FERC account.

HPC uses this design for customers very successfully. In concert with our SAP-certified solution HPC Utility Financials Accelerator, we update V_FERC_C8 in transaction SM31. Make all the secondary cost transactions primary (ECC 6.0 has radio buttons for this) except for settlement, which stays as a secondary cost. Then assign each cost center to a regulatory indicator. Finally, update the trace translation (FERC_C3) to include secondary cost elements converted to FERC accounts.

Depending on how you have configured FI, CO, and FERC, the FERC trace will run faster, provide more accurate labor costs and assessment detail, and provide enhanced drill-down using FERD or FEOD transactions. If you have SAP HR/Payroll and PM installed, you may see the work center of the employee, the time confirmation, and the notification in PM. You can't do that by using the FERC module with the traditional trace of FI documents only.

So why didn't we think of this 20 years ago? Well, for one thing, CO is not the general ledger. It was thought that FERC balances have to be supported by FI documents only. In reality, provided the FERC balances equal the natural accounts, it really doesn't matter whether FI or CO documents are used to support FERC. So, free yourself from the limitation of FI only, and unleash a new era of improved FERC reporting in SAP.

It's time to turn off the trace! If you do, users can enjoy one version of the truth whether running order reports in CO or looking at the final objects in FERC_D1 (the FERC module drill-down tool.)

SAP for Utilities: Best practices, real-world results, and industry insights

On any given day in the office, we're talking with customers, business partners, and our internal team about how to best address the SAP-related issues that utilities face — from accounting and billing complexities, to the challenges of reporting to external auditors and government regulators. As you can imagine, after more than 15 years of developing and managing SAP solutions for utility companies across the country, including the original IS-U/FERC module in 1994, we've got a lot of substantive stuff to discuss.

Unfortunately, many of these great ideas aren't as well documented as they could be; once the conference call or hallway conversation is over, they're gone, back in our collective heads.

No more. We're going to blog about our work, experience, and insights. We'll strive to make this space on the Web informative and useful for specific individuals at utilities running (or considering) SAP: executive management, plus accounting, finance, and IT professionals. Most posts will be written by HPC America's CEO, Jerry Cavalieri, with periodic contributions from our team of SAP senior solutions architects. And maybe even a guest or two from one of our utility customers.

So, thank you for reading and checking back every week or so. Please don't hesitate to contact us if you have any suggestions or questions.