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Activating Commitment Management

Commitment Management in SAP tracks future commitments against cost objects; this enables users to
make a realistic comparison of actual cost plus committed cost against plan / budget on that cost
object. Commitments are made when user creates purchasing document to purchase goods or services
at a future date. Comparing actual against budget is misleading unless you factor in the outstanding
commitments that will convert to actual cost in the future.
In this blog, I will provide an overview of the steps to activate and configure Commitment Management
in SAP.
Blogs on Commitment Management
In my series of blogs on Commitment Management, I intend to explain and elaborate the concepts behind
Commitment Management. I will demonstrate how Commitment Management works in SAP.
To identify the series of blog, I have categorised the blogs under SAP > Commitment Management in SAP. If you
have questions/ comments/ suggestions, please send me your comments in the form below. Sharing your questions
and experience using comment box below will help other readers to gain additional knowledge involved in this
Share this blog with your network using one of the social media icons at the top or bottom of this page.
#1 Commitment Management in SAP #1 An Overview (24/05/2012)
#2 Commitment Management in SAP #2 The process (31/05/2012)
#3 Commitment Management in SAP #3 Activation (07/06/2012)
#4 Commitment Management in SAP #4 Limitations (14/06/2012)
Assumption for this blog
This is the third blog in the series of blog on Commitment Management. It is a good idea to read the previous two
blogs before you read this blog.
The blog refers to Cost Center as the cost object. However, any reference to Cost Center will apply similarly to
Internal Order and Project as Cost Objects.
Activate Commitment Management
Commitment Management is, generally, activated at three levels:
Controlling Area
Cost Object Configuration and/or Cost Object Master Data
Activate Commitment Management for Controlling Area
Commitment Management should be activated at Controlling Area level before it can be activated for cost objects.
From IMG Path
[IMG] Controlling > General Controlling > Organization > Maintain Controlling Area
Activate Commitment Management for Cost Center
For Cost Centers, you can activate Commitment Management by cost center categories. If Commitment Management
is activated for a specific cost center category, then all cost centers created under this category are automatically
activated for Commitment Management. This is useful if (as an example) you want to track Commitments for all cost
centers assigned to “Management” cost center category.
From IMG Path
[IMG] Controlling > Cost Center Accounting > Master Data > Cost Centers > Define Cost Center Categories
Alternatively, you can activate Commitment Management by individual cost center. In this case, the user should
switch the indicator on cost center master to activate Commitment Management for that cost center.
Activate Commitment Management for Internal Orders
Commitment Management can be activated for Internal Order Types in the configuration.
From IMG Path
[IMG] Controlling > Internal Orders > Commitments and Funds Commitments > Activate Commitments Management
Activate Value-based Commitment Management
If values for purchasing documents determine the reduction of a purchase order commitment, then you need valuebased commitment management. To activate value-based Commitment Management, switch on the indicator in the
Unit of Measurement configuration.
In the IMG Menu
[IMG] SAP Netweaver > General Settings > Check Unit of Measurement.
Other than the above activation steps, there is no other configuration required to use the functionality of Commitment
Management. Commitment data will stack up in data tables in the background as users process front-end
transactions. This data can be used for reporting.
If standard Commitment Management reports do not suit your requirements, you can create new reports using Report
Painter/ Report Writer or in your Business Intelligence tool using standard SAP data library.
Commitment Management in SAP is easy to setup and offers useful features. In the next blog, I will reveal some
tricky issues faced by SAP customers; I will also list certain limitations in Commitment Management functionality in
SAP that you need to be aware of.