“I have ways of making money that you know nothing of.”– John D. Rockefeller
Maybe if SAP PCM were available and applied to Standard Oil business back in the day, we would all know Mr. Rockefellers ways of making money. You see, PCM is a user-friendly modeling engine to perform activity based costing in defining costing pools and allocations to a multi-dimensional set of data. Using PCM, costing can be aligned to customer, products, channels, segments, geographies, and the like. Utilizing a simple graphic interface to define relationships of costing, PCM generates logic to perform potentially massive calculations to very deep level of granularity; allocating overhead costs down to deep product levels.
Originally developed as a standalone Activity-Based Costing tool, PCM incorporates the industry standard costing methodology known as the CAM-I Cross of Activity Based Management. Integrated with the SAP Analytics platform, ABC becomes even more powerful in the ability to link results with planning scenarios (BPC) or business intelligence analytic tools (Analytics Cloud).
37%
Increase in revenue generated per employee, in organizations with mature cost accounting and analysis
Source: SAP Performance Benchmarking
Armed with that information, executives can make informed decisions on investments and optimizing corporate resources.
What truly are the company’s most profitable customers? To which customers are we giving away business and why? Why products are performing well? Is their profitable trend rising or are competitive forces meaning that a former top product is starting into decline?
Which of our distribution channels are operating well and profitable? Should I be growing our brick and mortar footprint to build brand awareness, or does the ease of the web channel drive enough volume and profitability to lead me to focus more marketing and promotion dollars in that area?
SAP BusinessObjects Profitability and Cost Management allows users to:
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