For almost two decades, South­ern Cal­i­for­nia Edi­son (SCE) has lived with the con­straints of a lega­cy SAP ECC envi­ron­ment. While the sys­tem sup­port­ed core finan­cial process­es, there were aspects that also cre­at­ed fric­tion: frag­ment­ed data, offline analy­sis, spread­sheets passed from team to team, and crit­i­cal hier­ar­chies man­aged out­side the sys­tem of record. 

As SCE moves to SAP S/4HANA, the util­i­ty is using the tran­si­tion to mod­ern­ize tech­nol­o­gy and rethink how projects, costs, rev­enues, and reg­u­la­to­ry report­ing are struc­tured across the enter­prise. At the cen­ter of that rethink is SAP S/4HANA Project Sys­tems (PS) and an expan­sive, non-tra­di­tion­al use of Work Break­down Struc­tures (WBS). 

“We’re not just imple­ment­ing a mod­ule,” said Rahul Chopra, SAP Solu­tion Archi­tect and Senior Man­ag­er at Ernst & Young LLP. ​“We’re fun­da­men­tal­ly chang­ing where and how costs, rev­enues, and cap­i­tal live in the system.” 

From Cost Cen­ters to a Uni­fied Enter­prise WBS 

SAP S/4HANA PS is designed to plan, exe­cute, and con­trol projects of many types: inter­nal ini­tia­tives, cus­tomer-dri­ven work, and cap­i­tal invest­ments. Its pri­ma­ry cost objects are WBS ele­ments, which define hier­ar­chi­cal project struc­tures and cap­ture finan­cial activ­i­ty in real time through inte­gra­tion with Finance and Con­trol­ling (FI/CO). 

At most orga­ni­za­tions, WBS ele­ments are used nar­row­ly: a project starts, costs are col­lect­ed, the project ends. At SCE, that par­a­digm is being stretched. 

“Tra­di­tion­al­ly, WBS ele­ments are lever­aged to account for cost,” Chopra explained. ​“But at SCE, we’re tak­ing it one step fur­ther. Not just cost, but rev­enue and cap­i­tal costs will be record­ed against WBS ele­ments as well.” 

In the future-state design, WBS ele­ments will replace cost cen­ters as the final rest­ing place for oper­a­tions and main­te­nance (O&M) expens­es. Cap­i­tal expen­di­tures will con­tin­ue to be cap­tured in PS, but with­in a redesigned struc­ture. Rev­enue and reg­u­la­to­ry bal­anc­ing account trans­ac­tions, which his­tor­i­cal­ly lived else­where, will also be record­ed on WBS to enhance ana­lyt­ics, report­ing, and accounting. 

From an enter­prise per­spec­tive, SCE has made a delib­er­ate deci­sion: WBS will become the com­mon des­ti­na­tion where finan­cial truth converges. 

The Chal­lenges of ECC and the Oppor­tu­ni­ty of S/4HANA 

The moti­va­tion for this shift is root­ed in expe­ri­ence. SCE has been on SAP ECC since 2008, and while the sys­tem met base­line needs, it forced teams to improvise. 

“We’ve had a lot of pain points that forced us to do a lot of work out­side the sys­tem,” said Dena Berkin, Senior Advi­sor for Busi­ness Trans­for­ma­tion & Readi­ness in Cor­po­rate Account­ing and Gen­er­al Ledger at SCE. ​“We pulled data into oth­er sys­tems, tracked things in Excel and Microsoft Access — just all sorts of craziness.” 

One of the biggest gaps was struc­tur­al. SCE invest­ed heav­i­ly in cre­at­ing activ­i­ty-based hier­ar­chies to under­stand how work was per­formed across the orga­ni­za­tion, but ECC lacked a nat­ur­al des­ti­na­tion to store and man­age them. 

“We had no place to put those hier­ar­chies in SAP,” Berkin said, refer­ring to their reliance on a third-par­ty tool. ​“So we came up with an idea that would give us flex­i­bil­i­ty and pow­er by mov­ing those hier­ar­chies back into SAP and uni­fy­ing every­thing where the costs and rev­enues end up.” 

The result is a design that lever­ages WBS not just for projects with start and end dates, but as stand­ing, per­sis­tent cost objects that reflect how work actu­al­ly hap­pens at SCE. The ques­tion ​“Why lim­it WBS to projects?” became a turn­ing point. 

“As we start­ed see­ing the func­tion­al­i­ty of WBS, we won­dered: ​‘Why are we lim­it­ing it to projects with an end date?’” Berkin said. ​“Why not have a sin­gle set of hier­ar­chies that can cross rev­enue, O&M, inter­est, depre­ci­a­tion, and tra­di­tion­al work management?” 

SCE is deeply invest­ed in plant main­te­nance (PM) orders, work orders, and work man­age­ment process­es. Fixed assets are man­aged through Pow­er­Plan. Rather than dis­rupt those sys­tems, the S/4HANA design con­nects them. 

PM orders and work orders will con­tin­ue to exe­cute work, but they will set­tle to WBS — mak­ing it the uni­fy­ing lay­er that links oper­a­tional exe­cu­tion with finan­cial insight. 

“Why not just do it all in WBS and unlock some of the cool stuff that WBS unlocks?” Berkin said. 

Lib­er­at­ing Project Sys­tems for the Business 

For SCE, this is both a finance trans­for­ma­tion and a busi­ness transformation. 

“We’re lib­er­at­ing Project Sys­tems and WBS to not just sup­port finance, but to sup­port the busi­ness,” said Tiffani Argan­dona, Prin­ci­pal Man­ag­er of Busi­ness Trans­for­ma­tion & Readi­ness for Cor­po­rate Account­ing and Gen­er­al Ledger at SCE. 

Under ECC, cus­tomiza­tions filled func­tion­al gaps, often at the expense of trans­paren­cy and flex­i­bil­i­ty. S/4HANA’s fit-to-stan­dard capa­bil­i­ties offer a way out. 

“WBS gives us the abil­i­ty to get dif­fer­ent func­tion­al­i­ty cap­tured in one place and get rid of sig­nif­i­cant cus­tomiza­tion we have in ECC,” Argan­dona said. 

One exam­ple is assign­ment func­tion­al­i­ty, which allows detailed PM order costs to be vis­i­ble with­in WBS struc­tures both before and after set­tle­ment. That vis­i­bil­i­ty sup­ports fore­cast­ing, over­sight, and deci­sion-mak­ing that pre­vi­ous­ly required offline analysis. 

“We think these enhance­ments will great­ly improve people’s abil­i­ty to see what’s going on and make sound deci­sions,” she said. 

From Spread­sheets to Real-Time Windows 

Today, many teams rely on spread­sheets sim­ply to keep track of the work they own. 

“We’re aware of folks keep­ing track of thou­sands of order num­bers in spread­sheets,” Argan­dona said. ​“They copy and paste them into reports just to run basic analysis.” 

A well-designed WBS struc­ture changes that dynam­ic entirely. 

“I real­ly like the anal­o­gy of WBS as a win­dow with a real-time view,” she said. ​“You can see what peo­ple are charg­ing, who charged it, what mate­ri­als are com­ing through, which ven­dors are involved. That’s some­thing we def­i­nite­ly don’t have today.” 

Berkin echoed that point, empha­siz­ing the depth of detail avail­able when WBS is designed correctly. 

“If you want to see the details of all the objects assigned to your WBS, you can see who charged the labor, which ven­dors were used, and you can drill right into it,” she said. 

Achiev­ing that trans­paren­cy requires thought­ful design. 

Berkin acknowl­edged that it would be chal­leng­ing, ​“But it’s worth it. We real­ly think we’re going to unlock so much ease of use and elim­i­nate a lot of the offline analy­sis peo­ple do today.” 

Strength­en­ing Reg­u­la­to­ry and Bal­anc­ing Account Processes 

The expand­ed role of WBS also plays a crit­i­cal role in SCE’s reg­u­la­to­ry reporting. 

Allie Sharkey Lois, Senior Tech­nol­o­gy Con­sul­tant at Ernst & Young LLP, described a sig­nif­i­cant busi­ness process improve­ment under­way, lever­ag­ing stan­dard func­tion­al­i­ty to replace a major enhance­ment for SCE’s Bal­anc­ing Account processes. 

“Dur­ing detailed design, we iden­ti­fied that putting all those dol­lars used to cal­cu­late pro­vi­sions and over-unders into one house would real­ly help auto­mate the process,” she said. 

By using WBS as the cen­tral struc­ture, SCE can ensure cal­cu­la­tions and report­ing are seam­less across reg­u­la­to­ry defer­rals, while reduc­ing man­u­al intervention. 

“It’s very excit­ing to add this new sub­struc­ture,” Sharkey Lois said. ​“It’s going to make automa­tion a lot more seamless.” 

SCE is build­ing an enter­prise WBS with five sub­struc­tures designed to cap­ture O&M, non‑O&M, cap­i­tal, rev­enue, and all com­po­nents of reg­u­la­to­ry bal­anc­ing accounts. 

Gov­er­nance, Flex­i­bil­i­ty, and Orga­ni­za­tion­al Change 

With this lev­el of cen­tral­iza­tion comes the need for gov­er­nance and flexibility. 

“We’re going to build gov­er­nance in up front,” Argan­dona said. ​“We’re doing the work now to make this work for everybody.” 

One advan­tage of a hier­ar­chi­cal WBS design is adapt­abil­i­ty. Orga­ni­za­tion­al respon­si­bil­i­ty, or what SCE refers to as ​“enti­ty”, will be able to shift over time with­out rewrit­ing his­to­ry or rebuild­ing systems. 

“If meter ser­vices move from one group to anoth­er, you just swing those in WBS,” Argan­dona explained, refer­ring to flex­i­ble Glob­al Hier­ar­chies in SAP S/4HANA. ​“Meter ser­vices is a kind of work. You can move it under one group or another.” 

That same flex­i­bil­i­ty applies to reg­u­la­to­ry recov­ery strate­gies, rate cas­es, and longer-term course corrections. 

“You can move activ­i­ties or realign things in the hier­ar­chy and avoid offline, sec­ond-sys­tem analysis.” 

At the end of the day, the guid­ing prin­ci­ple is to keep the WBS struc­ture based on the work itself and use hier­ar­chies to group and regroup as busi­ness needs evolve. 

Bring­ing It All Togeth­er with Real-Time Analytics 

SCE will have an enter­prise WBS with five sub­struc­tures to cap­ture O&M, non‑O&M, cap­i­tal, rev­enue, and all com­po­nents of reg­u­la­to­ry Bal­anc­ing Accounts. From a tech­ni­cal stand­point, the design brings mul­ti­ple SAP capa­bil­i­ties together. 

“This is how we’re plan­ning to bring every­thing into our report­ing solu­tions,” Chopra said. ​“We’re build­ing alter­nate activ­i­ty-based and enti­ty hier­ar­chies in S/4, with all cost set­tle­ments, bud­gets, and plans flow­ing through those five sub­struc­tures in Project Systems.” 

All of it inte­grates in real time with oth­er SAP mod­ules, post­ing direct­ly to the uni­ver­sal jour­nal (ACDO­CA) and plan­ning tables (ACDOCP). 

This foun­da­tion opens the door to embed­ded ana­lyt­ics and mas­ter data – dri­ven report­ing that reflects real-time oper­a­tional and finan­cial reality. 

“We haven’t built this yet,” Chopra said can­did­ly. ​“But we’re very con­fi­dent this is going to work.” 

Redefin­ing the Role of Project Systems 

SCE’s approach chal­lenges a com­mon assump­tion in SAP land­scapes: that PS is only for time-bound projects. 

By reimag­in­ing WBS as a per­sis­tent enter­prise struc­ture that cap­tures cost, rev­enue, cap­i­tal, and reg­u­la­to­ry activ­i­ty, SCE is posi­tion­ing SAP S/4HANA as a true sys­tem of record for how work gets done. 

“It’s not going to be easy,” Chopra said. ​“But we’re going to make it work.” 

If suc­cess­ful, the pay­off is sig­nif­i­cant: few­er spread­sheets, few­er shad­ow sys­tems, stronger gov­er­nance, and a sin­gle, real-time view of work and finan­cial per­for­mance across the enterprise.