What is zero-based budgeting method in SAP PM - Plant Maintenance?

SAP Term: zero-based budgeting method

• Component: PM

• Component Name: Plant Maintenance

• Description: Budget that is created on the basis of planned data, particularly on the basis of simulated planned costs and quantities. In plant maintenance, in practice this budgeting method is also referred to as zero-based budgeting. The budget is not determined on the basis of actual data, but on the basis of future planned tasks. Maintenance plans and task lists are drawn on as planning aids: The plan values of the goods and services work, external services, materials that they contain are determined automatically and entered as the budget.

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• Key Concepts: 
  Zero-based budgeting (ZBB) is a method of budgeting in which all expenses must be justified for each new period. This means that all expenses must be approved and allocated from the beginning of the budget period, rather than simply carrying over the previous period’s budget. This method is used in SAP Plant Maintenance (PM) to ensure that all expenses are accounted for and that resources are allocated efficiently. 
  
  How to use it: 
  In SAP PM, zero-based budgeting is used to create a budget for each period. This budget is then used to allocate resources and approve expenses. The budget is created by analyzing the current and past expenses, as well as any expected changes in the future. Once the budget is created, it can be used to approve and allocate resources for each period. 
  
  Tips & Tricks: 
  When creating a zero-based budget in SAP PM, it is important to consider both current and future expenses. This will help ensure that resources are allocated efficiently and that all expenses are accounted for. Additionally, it is important to review the budget periodically to ensure that it is still accurate and up-to-date. 
  
  Related Information: 
  Zero-based budgeting is a common method of budgeting in many industries, not just SAP PM. It can be used to create budgets for any type of organization or project. Additionally, there are many other methods of budgeting that can be used in SAP PM, such as activity-based budgeting or top-down budgeting.