1. Structure and Hierarchy

   - Internal Order: A cost object that does not follow a hierarchical structure. It is typically used to track costs, rarely revenue, for a specific activity or project.

   - WBS: Follows a hierarchical structure, breaking down the project scope into smaller, manageable components. It provides a clear overview of project deliverables and dates including detailed tasks, subtasks and their relationships.

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2. Cost Control and Monitoring

   - Internal Order: Provides a single charge code allowing cost tracking and monitoring. Costs can be charged to specific internal orders and later allocated or settled to cost centers, enabling accurate analysis of project-driven expenses in contrast to ongoing operational cost center costs.

   - WBS: Each WBS can be a charge code and can directly track revenues and/or costs, however, WBS is better utilized to provide a framework for more detailed cost estimation and control at the lower level WBS or networks. By breaking down the project into smaller components (network activities), it becomes easier to estimate costs, plan requisitions and purchase commitments, monitor budget utilization, and schedule accurate delivery dates.

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3. Resource Allocation and Planning

   - Internal Order: Does not provide a direct mechanism for resource allocation, planning nor scheduling, beyond simple start and end dates. However, it can be used in conjunction with other SAP modules such as purchasing to track commitments and actual costs based on 3-way matches in addition to managing basic logistics effectively.

   - WBS: Facilitates resource allocation and planning by breaking down the project into tasks with specific planned and actual completion dates. Each task within the WBS can be assigned to specific resources, ensuring efficient planning, scheduling, and utilization of available materials, equipment, and work teams.

 

The Project Planning Tool Decision Matrix provides an approach to help you choose which SAP project tool, Internal Order or WBS, to use based on your detail planning requirements, specific planning scenarios, and/or use with an external project management application.

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4. Reporting and Analysis

   - Internal Order: It offers basic reporting capabilities, allowing project managers to generate reports on project costs, budget utilization, and variances. These reports provide valuable insights supporting simpler funds tracking and cost center allocation and analysis decision-making.

   - WBS: Provides extensive reporting features and serves as a foundation for detailed project status management, document management, and advanced reporting. By organizing and scheduling project tasks by deliverables, it becomes easier to track progress, assign detailed costs to the appropriate capital or expense asset, cost center, or sales orders, and support timely and meaningful project decisions.

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5. Integration with Other SAP Modules

   - Internal Order: Integrates with several SAP modules, including Controlling (CO), Financial Accounting (FI), Purchasing (MM), and Investment Management (IM). This integration enables a holistic view of project costs, budget allocations, commitments, and financial performance.

   - WBS: Integrates within SAP not only with Controlling (CO), Financial Accounting (FI), Materials Management (MM), and Investment Management (IM) but more importantly with Sales and Distribution (SD), Logistics Execution (LE), Production Planning (PP), Plant Maintenance (PM), Project System (PS-Networks), and Human Resources (HR). This integration leverages the specific module functionality to ensure efficient communication and coordination between different project management functions.