Manage Project Hierarchies

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Use your project investment hierarchy to manage the investments and services that comprise your project. You can track the costs incurred to build, maintain, and support the project. The hierarchical list includes projects, assets, applications, products, services, and other work. You can also see the project effort rollup from its child investments.
Both the financial rollup and the effort rollup are hierarchical representations of the investments, services, and ideas that comprise your project. In the hierarchy, the Self line displays, depending on the view you have selected, the work values or costs that are specific to your project or the parent investment. The line items below the Self line are the child investment or services that comprise your project and the work values or costs specific to those child investment and services.
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Project Investment Hierarchy
Add child investments, services, or ideas to your parent project to build your project investment hierarchy. The child investments, services, and ideas that you can add to your project hierarchy are limited by the following conditions:
  • You have view access rights to the child investments, services, and ideas.
  • The child investments, services, and ideas are associated to the same entity as the parent project.
The costs that are associated with the child investments (forecasted and budgeted) are rolled up to the parent project as planned costs. The planned costs appear on the financial rollup page of the project hierarchy. Similarly, the effort values associated with the child investments or services are rolled up to the parent project. The effort values appear on the effort rollup page of the project hierarchy. 
You can also create a program that includes multiple projects in its hierarchy. The financial and effort values from the child projects are rolled up to the parent program.
View the Project Financial Rollup
The financial rollup for a project hierarchy aggregates the costs (planned, actual, and remaining) for its child investments, services, or ideas. The displayed values are time-varying and factor in the allocation percentages that you define for your investments. The project hierarchy can include child investments, services, or ideas that are associated with multiple currencies. To provide the financial rollup from multiple currencies, the product completes the following tasks:
  1. Converts the different currencies to the parent project currency using the foreign exchange rates defined under Finance Setup in the Administration tool. For more information, search for
    Currencies and Foreign Exchange Rates.
  2. Aggregates the converted values from the child investments and rolls up to the parent project.
For example, a parent project currency is US dollars. The project includes two child investments in its hierarchy that have Euro as their currency. To provide a financial rollup for this project, the product first converts the Euro values from the child investments to US Dollars. The product then aggregates the converted currency values from the child investments and reflects them at the parent project level in US Dollars.
Follow these steps:
1. Open the project for which you want to view the financial rollup.
2. Click Hierarchy.
3. View the following financial values that rolled up from the child investments:
  • Planned Cost
    Displays the planned costs (forecasted and budgeted).
  • Actual Cost
    Displays the costs that are incurred from chargebacks and invoices. If the project is unapproved, actual costs do not display on the financial rollup because costs are yet to incur.
  • Remaining Cost
    Displays the difference between the planned costs and the actual costs.
  • Planned Benefit 
    Displays the planned revenue or the sum of the planned benefit and forecasted benefit.
  • Planned NPV, Planned ROI, Planned IRR, Planned MIRR, 
    Planned Payback Period
    Displays the planned values for the metrics from the project financial summary.
     The financial metric values are calculated at run-time based on the total costs and benefits over time for the child investments. The values are then rolled up to the parent investment. The calculation accounts for the timing for when the costs and benefits occur and their relative size. If the timing for a child investment extends beyond the timing for the parent investment, the calculation accounts for the extended time-frame. The calculation does not account for any interests, taxes, depreciation and amortization. To forecast the profitability of an investment accurately, consider adding these values to the investment cost and benefit plans. 
Example: Financial Rollup in a Program Hierarchy with Multiple Levels
When aggregating values from the child projects to the parent project in a hierarchy, the product considers the child currencies and the foreign exchange rates. The same rule applies to projects rolled up to a program hierarchy or a portfolio. You can plan child project costs in their local currencies. However, the rolled up cost to the parent project considers the parent project currency. In a multi-currency environment, you can get the correct cost for a project or program hierarchy with multi-currency investments.
Prerequisites
To view the financial rollup in a project or program hierarchy, verify that the following requirements are complete:
  • System is set up as a multi-currency environment
  • Foreign exchange rates are defined for all supported currencies
  • Projects and programs are defined with financial summaries
  • Hierarchical structure is setup with child projects at desired levels
The following image shows a sample program hierarchy with five levels of child projects. The currencies for the child projects and the parent program are listed under the Currency Code column. The planned cost for each child project and the total at each level is listed under the Planned Cost column. The amount is listed in the parent currency code (USD) after conversion. The aggregated total cost is listed at the parent program level (also in USD).
The following image shows a program hierarchy with five levels of child projects.
The following image shows the foreign exchange rates that are defined in the system for the supported currencies:
The following image shows the foreign exchange rates that are defined in the system for the supported currencies.
The following table shows how the system uses the foreign exchange rates to convert the child costs into the parent currency. The system then adds ups all the converted values from the child projects to calculate the aggregate at the parent level. The planned cost amounts and currency codes for the child projects are defined in the financial summary pages.
Hierarchy Level
Child Project
Planned Cost Before Conversion
Planned Cost After Conversion (USD)
Rolled Up Cost at each Level (USD)
1
Projchild6
10,000 AED
10,000*0.50 = 5,000
5,000
2
Projchild5
4,000 EUR
4,000/0.50 = 8,000
13,000
3
ProjChild4
4,000 AED
4,000*0.50 = 2,000
15,000
4
ProjChild3
8,000 GBP
8,000/0.5.0 = 16,000
31,000
5
ProjChild1
10,000 ADP
10,000/0.50 = 20,000
51,000 (cost at the program level as the there is not cost for the program itself)
Add and Remove Child Investments and Services from the Financial Rollup
Before you add investments, services, and ideas to a hierarchy, verify that you have already created them in the product. Work with your investment managers to determine and define the investment or service allocations for each of the child investments and services that you are adding to the hierarchy.
Follow these steps:
1. Open a project.
2. Click the Hierarchy tab.
By default, the financial and effort rollup displays a list of both approved and unapproved child investment and services. You can view only approved child investment and services, or unapproved. Open the Filter and select the status in the Status dropdown.
3. Do one of the following: 
Add a Child Investment and Service
a. Click Add Child.
b. Select one or more child investments or services to add to the project, and click Add.
The child investment or service is added to the hierarchy.
Remove a Child Investment and Service
a. Select the check box next to the child investment or service to remove from the project, and click Remove.
b. Click Yes to confirm the removal.
The child investment or service is removed from the hierarchy.
Add an Investment from Another Entity
When adding child investments to your project hierarchy not all investments are visible. The list of investments on the browse window for adding a child investment only shows investments in the same entity as the parent investment. The entity is determined by the department OBS. If the parent investment has no entity, the list includes all investments with no associated entity.
To add a project from another entity, use this procedure:
  1. Click the Properties tab menu and select Subprojects.
  2. Click Add.
  3. Apply filter criteria to identify investments.
  4. Select the check box for one or more investments and click Add.
  5. Click the Hierarchy tab.
  6. If your investments from different entities do not already appear as subprojects, you can click Add Child to add them.
Define Child Investment and Service Allocations
When you first add a child investment or service to a project, its investment allocation is set at 100 percent by default. You can view the amount a child investment is allocated to a project from the allocation amount that is listed in the Allocation column on a project's financial and effort rollup. When necessary, you can modify the allocation percentage for a child service, investment, and idea in a project.
Follow these steps:
1. Open a project.
2. Click the Hierarchy tab.
By default, the financial and effort rollup displays a list of both approved and unapproved child investment and services. You can view only approved child investment and services, or unapproved. Open the Filter and select the status in the Status dropdown. 
3. In the Allocation column, click the amount for the child investment or service that you want to define. 
The
Set Allocations
page appears. 
4. In the Allocation field for the project, enter the amount this child investment is allocated to the project, the parent investment. 
You can allocate investments and services to one or more child investments or services. The total allocation percentage for a parent investment must equal 100 percent. You can view the project's parent investments allocation amounts on the 
Project: Hierarchy: Parents
 page. 
5. Click Save.
View a Project's Total Cost of Ownership (TCO)
The total cost of ownership (TCO) is the aggregated amount of running or operating a project, including the investments, services, and ideas that support the project. The TCO tracks where costs are being spent and how costs are being shared. You can manage costs proactively to keep on budget.
Once you have added all child investments to the project, you can view the aggregated cost and labor totals from the hierarchical bill of investments to determine the project's TCO.
View a Project's Effort Rollup
You can view the effort rollup of the investments, services, and ideas that comprise a project.
Follow these steps:
1. Open the project for which you want to view effort rollup.
2. Click the Hierarchy tab, and then click the Hierarchy, Effort Rollup subtab.
The aggregation of the project's child investment labor-related information displays, such as ETC, estimate at completion (EAC), and work variances, while considering the child investment or service's allocation percentages. View these totals in the ETC, EAC, and Actual Work columns.
The investments on this page are the same investments that are displayed on the
Project: Hierarchy: Financial Rollup
page. This page provides another view of your project's hierarchical list of child investments, services, and ideas.
3. View the list of investments.
Add and Remove Project Parent Investment Associations
You can add and remove parent investment associations to and from a project that is based on your company's business rules.
Follow these steps:
1. Open the project for which you want to add or remove parent investments.
2. Click the Hierarchy tab.
3. Do one of the following:
Add Parent Investments to a Project
You can add any investment to which you have access rights as a parent investment to a project. You can add one parent investment, or you can add multiple investments at one time.
Before you add parent investments, services, and ideas to the hierarchy, verify that you have already added them. Work with other investment managers to determine and define the investment or service allocations for each of the child investments and services you are adding to the hierarchy.
a. On the Hierarchy menu, click the Parents subtab.
On this page, view a list of parent investments and services to which your project is allocated and to view the percentage that your project is allocated to each parent.
b. Click Add.
c. Select the check box next to the parent investment you want to add, then click Add.
The parent investment is added to the project.
Remove Parent Investments from a Project
a. On the Hierarchy menu, click the Parents subtab.
On this page, view a list of parent investments and services to which your project is allocated and to view the percentage that your project is allocated to each parent.
b. Select the check box next to the parent investment you want to remove, then click Remove.
c. Click Yes to confirm the removal.
The parent investment is removed from the project.
Share Projects Across Investments or Services
You can share projects between other investments, services, and ideas. For example, you can share a database server that will support two software applications. To do this, first add the software applications as child investments to the database server's investment hierarchy. Then, edit the child investment or service's cost allocation percentage and time segments.
The project's investment allocation percentage determines the amount that the project is allocated to the investment, service, or idea. All cost information that is displayed in the investment hierarchy is based on the allocation percentages.
Child investment cost totals are automatically aggregated to the parent investment based on the investment allocation percentages.