SAP --> BPC Default Profit Center to Cost Center Relationships

While in other posts I have hinted around at it to get you thinking why profit centers can be a roll-up of cost centers, I have also tried to hint at why it might also not be a roll-up but rather a dimension. 

We will start with default relationships and the default "this is the way it is" behavior of SAP.  And make no mistake about it this is the default behavior no matter what you think!

Essentially, to be direct, what I am saying here without saying it just out right is that the proper LONG term relationship of Profit Center to Cost Center is that of a SLOWLY changing dimension within the SAP standard behavior.  If you want to be able to post one cost center to many profit centers in documents and maintain that relationship at all times it would most certainly be a dimension rather than a roll-up of cost centers, but in the backend system the relationship of cost center to profit center does not change with  posting but changes over time most typically.  Even that requires a dimension in the best designs. 

I discuss this for a couple of reasons.  1. it is always good to know what is possible within SAP by standard and know how to manage that and 2. I don't want you to be mislead by the SAP BPC exam question that suggests that cost centers are always rolled up to profit centers in a parent child relationship within a single dimension!! because that relationship can be managed in SAP FICO.

Moreover, the reason why this conversation often comes up with clients is because responsibility accounting decisions have not been firmly made, and the idea of assessments and distributions is not fully understood.  All of this said, later posts will show you how you can break this general design rule in SAP ECC to get the behavior a client might want without creating unnecessary cost centers.   Whether this is good or bad is not the purpose of this Blog!

As a matter of opinion, it is my personal view that the proper entity relationship from a data model perspective is that a cost center should be able by default to post into any profit center just as configuration settings allow you to post a single cost center to MORE than ONE company code as shown here if you want to know where to set it.  And by the way this DOES NOT require more than one controlling area and this setting has been known for YEARS by experts and used by some to great purpose!

Single Controlling Area Cost Center Posts to Many Company Codes

There are reasons why this is a good thing and reasons why it is not, but it can be controlled with various processes.  The issue becomes, the processes are hard to maintain overtime as is typical with SAP implementations that the application awareness and compliance diminishes over time.

All of this said, the following demonstrates what one would typically find in a standard SAP system today regarding profit center behavior when the controlling object is a cost center.