In the manufacturing sector, where capital expenditures frequently reach into the hundreds of millions and asset lifecycles span decades, CapEx is more than a budget line – it’s a strategic lever. For CFOs of large enterprises running SAP, the responsibility to ensure every investment aligns with long-term operational and financial goals is reaching a new level of urgency. With tightening margins, complex global supply chains, and intensifying ESG scrutiny, enterprise-level CapEx oversight is key to managing risk and delivering sustainable value.

Yet many capital planning processes remain fragmented – managed in spreadsheets, tracked via email, and disconnected from core ERP systems. This lack of integration undermines data integrity, limits visibility across business units, and delays critical decision-making.

SAP provides the financial control for managing the capital lifecycle—from budgeting and approvals through to execution and asset capitalization—but the real challenge lies in operationalizing its full capabilities. CFOs are the transformation leaders of CapEx oversight from a compliance obligation into a performance advantage. By embedding governance, scoring and ranking, and analytics directly into the investment process, investment prioritization and control can be optimized to deliver sustainable competitive advantage

This blog explores how manufacturing CFOs can establish true enterprise-level CapEx oversight by leveraging SAP Investment Management, Fiori-based digital workflows, and integrated reporting. We’ll examine common roadblocks, best-practice architecture, and how leading manufacturers are closing the gap between capital planning and capital performance.

What Is Enterprise-Level CapEx Oversight?

Large manufacturing enterprises need CapEx management that unifies, and coordinates approaches across divisions, business units, and locations. Enterprise-level CapEx oversight aligns capital projects with the overall business strategy while ensuring compliance, efficiency, and accountability. It integrates, monitors, and controls capital expenditures across all levels of the organization, from initial requests to final asset capitalization.

For CFOs in manufacturing, this means moving beyond isolated capital investment processes and adopting a centralized approach. In SAP, achieving this level of oversight involves the implementation of standardized investment programs, hierarchical structures for budgeting, and automated workflows that ensure seamless approvals and auditable records.

Key SAP CapEx Objects CFOs Should Understand

To gain enterprise-level CapEx oversight, CFOs should have a strong understanding of the key SAP objects that underpin capital investment management. If SAP is your core ERP platform, you have undoubtedly already invested heavily in its licensing implementation and support. It makes financial sense to fully utilize the core capabilities provided by the extremely powerful system.

While technical implementation often involves close collaboration with IT teams, a solid grasp of these components allows CFOs to play a proactive role in improving and optimizing capital expenditure processes across multiple sites and divisions.

Investment Programs

Investment Programs serve as the foundational framework for structuring capital investments across your enterprise. In SAP, they enable CFOs to create a hierarchical budget structure, allowing for budgeting and reporting at multiple levels—whether by plant, division, or project type. This structure ensures that capital allocation aligns with both local and enterprise-wide strategic priorities, providing full visibility and control.

Investment Measures

Investment Measures (Internal Orders, WBS Elements) represent individual projects or assets within the broader investment program. These measures are the financial objects that track the execution and costs associated with each specific initiative. For manufacturing CFOs, understanding how to leverage Work Breakdown Structure (WBS) elements is key to aligning budgets with project phases, ensuring resources are allocated efficiently, and tracking actual versus planned spending.

Internal Orders vs. Projects

A common challenge in manufacturing CapEx planning is determining when to use Internal Orders versus Projects for tracking investments. Internal Orders are generally used for simpler projects and direct purchases, whereas Projects are used for larger, more complex investments. Understanding the distinction between these objects and encouraging IT teams to apply the correct technical components, helps ensure both accurate cost tracking of in-flight projects and the timely and accurate capitalization of fixed assets on project completion.

Budgets vs Plans

Whilst many organizations resort to tracking CapEx outside the system, SAP provides effective capabilities for monitoring spend within the system.

Budgets can be distributed to individual projects on approval on an overall and annual basis. By applying budget availability checks, project managers can be prevented from raising purchase orders (committing) to higher expenditure, serving as a very effective CapEx control.

Planning in SAP is more flexible and can be assigned at a cost component level and be distributed by month. Whilst expenditure variances can be incurred, the more granular level of planning enables exceptions to be identified earlier, and mitigating actions taken sooner.

Group, local and transaction currencies

Much manufacturing capacity these days is located in low-cost jurisdictions such as Vietnam. Sophisticated machinery and equipment are often sourced from global suppliers, often based in China. Consequently, foreign exchange management is a feature of capital projects.

As a global enterprise system, SAP provides sophisticated exchange rate management capabilities. The underlying transaction currency of the commitment, local reporting currency of a manufacturing subsidiary, and the group reporting currency amount are all tracked in parallel. Whilst future transactions are estimated at a forecast exchange rate, historical transactions are reported at the actual exchange rate.

Provided your SAP system has been set up correctly, it is possible to effectively evaluate and report any exchange rate variances separately from any real expenditure variances.

Status Management

Distinguishing the project stage is important for process control. Planned projects, approved projects, technically completed and finally closed projects can be readily analyzed based on their SAP Status.

In addition to the analysis value, project status can also control what can be done on the project. For example, once technically complete, new purchase orders against the project can be prevented, but correcting journals and accruals is still allowed.

Fixed Assets and Equipment

Integration with SAP Asset Accounting (AA) connects CapEx projects to tangible fixed assets. As capital investments are completed, SAP’s seamless integration with Asset Accounting ensures that costs are correctly capitalized, enabling accurate asset valuation, depreciation tracking, and reporting. This integration ensures that capital expenditures lead to the creation of valid identifiable assets that are timely and accurately accounted for in the company’s financial records.

In addition, it is beneficial to register serviceable items as equipment records in SAP. Equipment is maintained in SAP using the Plant Maintenance functionality, which allows for effective planning and budgeting of scheduled maintenance tasks. When useful life is impacted by usage (such as number of heats, mileage, or production line throughput), the SAP Plant Maintenance module can keep track of these measuring points over time. Together with closely tracking equipment maintenance costs over time, these physical usage statistics help predict the expected renovation or replacement schedule of critical items of equipment.

Common CapEx Challenges in SAP-Run Manufacturing Environments

Manufacturing CapEx processes often involve massive investments in plant infrastructure, machinery, and long-term assets. For large enterprises running SAP, the systems and workflows designed to manage these investments should ideally provide clear oversight, streamline approvals, and integrate data across multiple business units. However, the gap between SAP’s powerful capabilities and the way many organizations operate remains a persistent issue, undermining efficiency and creating risk for CFOs.

Siloed Planning in Spreadsheets

Even with SAP in place, many manufacturing finance teams still rely on spreadsheets for planning and managing CapEx. They create separate budgets for each production line, piece of equipment, or facility expansion outside the SAP system, leading to fragmented data and disconnected workflows.

Manufacturing projects involving large-scale capital expenditures—such as factory expansions, machinery upgrades, and long-term equipment investments—can suffer severe consequences from fragmented data. Without full integration into SAP, finance teams struggle to accurately track spending against forecasted budgets and cannot manage project costs in real time. For CFOs, this inefficiency limits their ability to oversee CapEx effectively and reduces the visibility needed to maintain control over a portfolio of projects across different sites and units.

In addition, the reliance on spreadsheets makes it difficult to enforce budget controls or align planned expenditures with actuals, further hindering decision-making. Manufacturers often face unexpected delays in machinery procurement or facility construction, where timely adjustments to the capital budget are crucial. This is why CFOs must have direct visibility into these processes to align financial strategy with production goals, ensuring that capital is deployed optimally across the organization.

Manual Workflows and Compliance Risk

Manufacturing CapEx approvals are often routed manually through email or SharePoint, with limited integration into the central SAP system. This lack of automation creates gaps in auditability and compliance, especially in industries where regulatory requirements are stringent, such as in chemicals or heavy manufacturing.

Manual workflows contribute to delays in approvals and project initiation and can result in miscommunication between production and finance teams. This makes it challenging for CFOs to track project timelines, cost estimates, and approval statuses in real time. Worse, compliance risks can arise if capital projects are not properly documented or monitored within SAP, especially when dealing with capitalizing assets such as machinery and plant upgrades.

A critical challenge in manufacturing is ensuring that capital projects are aligned with financial compliance. As Gartner points out, CFOs must leverage integrated systems to eliminate bottlenecks, creating automated workflows that route approvals seamlessly through the SAP system. This can significantly reduce the risk of delays, errors, and non-compliance, while also ensuring transparency across all CapEx initiatives.

The Association for Financial Professionals (AFP) emphasizes the strategic role of CFOs in managing capital and ensuring compliance. According to AFP, modern CFOs must drive digital transformation by adopting integrated technologies that connect financial data with operational outcomes, making it possible to align CapEx with corporate objectives while mitigating risks.

Inconsistent Project Visibility

Manufacturing projects are large, multifaceted, and span across multiple locations and departments, making it difficult for CFOs to track and assess performance at a granular level. Capital expenditures in manufacturing typically involve complex machinery investments, large-scale facility expansions, or major technology upgrades—each with its own set of costs, timelines, and impacts on operational efficiency.

Without integrated dashboards and reporting tools like SAP Fiori apps and SAP Analytics Cloud (SAC), CFOs struggle to gain a consolidated view of project progress, spending, and overall ROI across the enterprise. Whether it’s understanding the costs associated with building a new production facility, upgrading machinery, or investing in energy-efficient technology, CFOs need access to up-to-date data and detailed project statuses.

With the right integration of SAP tools, finance leaders can reallocate funds in a more agile fashion to manage delays or cost overruns, compare capital efficiency across production lines or regions, and prioritize high-impact investments. For example, SAP Fiori apps support task-level execution and approvals, while SAC delivers enterprise-level analytics that connect CapEx planning with actuals and performance outcomes.

Forecasting Accuracy

A major concern of CFO’s is providing reliable market guidance on Capital Expenditures. In the current environment, the pervasive issue tends not to be overspent, but rather quarterly underspend caused by project delays. Reluctancy of project managers to release budget allocation for the fiscal year is a form of budget sandbagging.

More effective CapEx forecasting can be achieved by the application of Artificial Intelligence (AI). With reference to an organization’s historical project data, AI solutions are effective at extrapolating more reliable project forecasts based on familiar patterns of expenditure. By comparing both the manual forecast and the AI generated forecast, CFOs are able to more confidently predict the likely CapEx for the fiscal period.

SAP-Integrated CapEx Processes: The Foundation of Oversight

For manufacturing CFOs, true control over capital expenditures doesn’t come from spreadsheets or disconnected approval charts comes from fully integrated processes that span strategy, budgeting, approval, execution, and capitalization. SAP provides the foundation for this oversight, enabling finance leaders to manage CapEx as a continuous, auditable lifecycle rather than isolated events.

From Budgeting to Execution: A Connected Lifecycle in SAP

Manufacturers investing in large-scale infrastructure, production equipment, or digital automation must coordinate financial oversight across every stage of the project lifecycle. SAP allows organizations to connect strategic intent with day-to-day execution through a seamless, system-driven process:

• Plan: Define top-down Investment Programs that reflect strategic priorities—allocating budgets hierarchically across business units, plants, or regions.
• Request: Submit Capital Expenditure Requests (CERs) via standard SAP interfaces or Fiori apps, embedded with validation rules that align with financial and operational policy.
• Approve: Route requests through multi-level approval workflows, leveraging SAP Business Workflow or extended Fiori capabilities to capture digital signoffs and ensure accountability.
• Track: Monitor actual spends against budget in real time using SAP standard reports, embedded analytics, or SAP Analytics Cloud (SAC) dashboards tailored for capital project performance.
• Settle: Finalize projects by capitalizing eligible costs to Assets Under Construction (AuC) or fixed assets, ensuring alignment with asset lifecycle and depreciation schedules in SAP Asset Accounting (AA).

This closed-loop process reduces delays, eliminates manual reconciliations, and gives CFOs real-time insight into capital project performance at both a granular and portfolio level.

The Role of SAP Investment Management (IM)

At the core of SAP’s capital planning architecture is Investment Management (IM)—a purpose-built module for managing and controlling CapEx across the enterprise. IM acts as the budgeting backbone for large manufacturers, allowing finance teams to:

• Allocate and control budgets at multiple levels, whether tied to corporate investment programs, individual WBS elements, or internal orders.

• Maintain audit trails of all approvals, adjustments, and transfers, supporting internal controls and compliance with financial governance frameworks.

• Integrate seamlessly with SAP Project System (PS) for detailed scheduling and execution, Controlling (CO) for real-time cost tracking, and Asset Accounting (AA) for capitalization and reporting.

For manufacturers balancing multi-site expansions, factory modernization programs, or automation-driven CapEx initiatives, this integration is essential. It enables CFOs to track every dollar from board-level investment decisions to shop-floor deployment—ensuring capital delivers measurable value, not just approved spend.

A CFO’s Toolkit: CapEx Oversight with SAP + Extended Tools

Manufacturing CFOs don’t just manage budgets, they steer large, multi-site investment portfolios across plants, production lines, and infrastructure. From capacity expansion and equipment modernization to ESG-driven upgrades and regulatory compliance, capital investments must be tightly aligned with operational priorities and ROI targets.

SAP provides the financial control layer, while integrated solutions like IQX Fiori Apps and Stratex Online extend transparency, auditability, and strategic insight from plant-level operations to the executive suite. Even for organizations still on ECC, these tools enhance CapEx governance without requiring full migration to S/4HANA.

CapEx Oversight in SAP ECC and S/4HANA

Manufacturing capital planning and execution is complex—each plant may run hundreds of projects annually, ranging from machine upgrades to full production line expansions. SAP’s core modules—Investment Management (IM), Project System (PS), Controlling (CO), and Asset Accounting (AA)—support granular tracking of projects across locations, asset classes, and cost structures.

With enhanced reporting and workflows, CFOs can:

• Monitor project pipelines across multiple plants, warehouses, and regions
• Identify delays or bottlenecks in project approvals, particularly for high-value or safety-critical upgrades
• Track CapEx utilization against approved investment programs, grouped by asset class, production line, or site
• Analyze ROI based on energy savings, downtime reduction, or throughput improvements
• Compare performance of capital programs across plants to support global standardization or continuous improvement initiatives

On ECC, standard reports (e.g., IM reports, CJI3, S_ALR_87013558) provide base-level visibility. With enhancements—such as custom dashboards, SAP Query, ALV reports, or Fiori-style web interfaces via NetWeaver Gateway—finance teams can achieve near real-time reporting and cross-functional insight without needing S/4HANA.

On S/4HANA, embedded analytics and Fiori apps allow for real-time, plant-level KPI tracking, such as CapEx-to-depreciation ratios, unplanned spend by asset category, or forecast accuracy per site.

Digitized CERs with SAP Fiori Apps

Manufacturing organizations often struggle with fragmented CER processes, especially when requests originate on the plant floor or in engineering. Paper-based forms, spreadsheets, and email approvals delay project initiation and introduce risk.

IQX CapEx Management Fiori apps digitize the entire CER lifecycle—directly in SAP—making it easier for plant engineers, maintenance managers, and production leads to submit requests while giving finance and central teams the controls they need.

Key features include:

• Web-based or Fiori apps accessible from shop-floor terminals or corporate HQ
• Validation against SAP master data for equipment types, GL accounts, cost centers, and more
• Multi-level approvals tailored to investment type (e.g., replacement vs. expansion), site, or asset class
• Auto-assignment of WBS elements or internal orders to streamline downstream project setup
• Built-in audit trails and digital document capture for compliance with ISO, SOX, and local regulatory frameworks

This ensures that capital upgrades—whether it’s an HVAC overhaul, new packaging line, or ERP hardware refresh—move from idea to execution efficiently and transparently.

Strategic Planning with SaaS Tools Like Stratex Online

Manufacturing CFOs must constantly evaluate competing capital demands—from safety compliance to innovation investments—all while balancing labor constraints, supply chain volatility, and environmental targets.

Stratex Online is a cloud-native capital planning solution that integrates with SAP to bridge the gap between portfolio steering and SAP execution—whether you’re on ECC or planning an eventual transition to S/4HANA. It gives CFOs the long-range planning power they need now, without forcing system change before the business is ready.

CFOs use Stratex Online to:

• Prioritize plant-level projects based on strategic alignment, capacity impact, and ROI
• Model funding trade-offs across expansion, automation, and sustainability programs
• Forecast capital needs over multiple horizons, accounting for asset lifecycles and maintenance triggers
• Standardize project scoring and justification across plants to improve capital efficiency
• Push approved initiatives into SAP IM or PS for execution, ensuring data continuity

Whether you’re deciding between upgrading a bottlenecking line in Mexico or funding a solar installation in Germany, Stratex equips CFOs with a portfolio-wide lens—and the technical integration to make each investment count.

Strategic Recommendations for CFOs: Architecting Capital Planning in Manufacturing

Capital planning isn’t just a reporting exercise—it’s a system architecture challenge. CFOs must lead the configuration of SAP’s CapEx processes to ensure financial governance, data integrity, and portfolio agility from day one. That means owning the design of investment structures, driving automation in approvals, and enabling real-time analytics that connect strategy to plant-level execution.

Take Ownership of CapEx Architecture in SAP

In discrete and process manufacturing, CapEx isn’t just finance—it’s the foundation for how plant and maintenance projects are initiated, executed, and monitored. CFOs must lead the functional design of SAP Investment Management (IM) and its integration with SAP PS, CO, and Asset Accounting (AA) to ensure financial structures reflect physical asset flows.

• Segment Investment Programs by plant, production line, or asset class to allocate and control budgets at the right operational granularity.
• Configure Investment Measures or WBS elements to mirror manufacturing workstreams—from machinery upgrades to capacity expansion—so costs can be captured where they occur.
• Use SAP Commitment Management to track pre-approved purchase requisitions and avoid overspend before it hits the general ledger.
• Implement status profiles, user status checks, and release strategies to enforce discipline across the project lifecycle—from planning to settlement.

CFOs who shape these structures ensure not just audit readiness, but alignment between strategic intent and operational execution—across plants, programs, and financial periods.

Digitize the End-to-End Request and Approval Flow

Manufacturing CapEx delays are operational delays. When requests for new conveyors, machines, or packaging lines get stuck in inboxes, throughput and customer delivery suffer. That’s why CFOs must digitize CERs across the organization—directly in SAP.

• Deploy SAP Fiori-based CER applications, like those offered by IQX, to allow engineers, maintenance planners, and finance teams to initiate requests with predefined cost objects and justification templates.
• Use embedded SAP validations to prevent invalid combinations of asset class, cost center, and internal order—before requests move forward.
• Configure tiered approval hierarchies (e.g., plant manager → regional ops → finance director) with escalation paths for high-value or strategic investments.
• Auto-generate WBS elements or internal orders on approval, so project tracking and procurement can begin without delay.
• Enable real-time budget checks at approval using SAP’s Availability Control (AVC) to ensure allocations align with program limits and prevent overruns downstream.

The result is a transparent, traceable, and SAP-compliant CapEx process that moves at the speed of the production floor.

Invest in Analytics and Portfolio-Level Views

Capital investment in manufacturing must balance plant-level agility with enterprise-wide strategy. CFOs need both a microscope and a wide-angle lens to optimize allocation and track value realization.

• Use SAP Analytics Cloud (SAC) or BW-integrated dashboards to consolidate CapEx data from across production sites, R&D facilities, and maintenance programs.
• Define plant-specific KPIs—like CapEx-to-output ratios, downtime reduction per dollar invested, or unit cost improvements linked to CapEx projects.
• Monitor underutilized or delayed investments across factories, using traffic-light indicators and trend lines to flag risks early.
• Integrate financial metrics with operational data from MES or plant historians (via SAP MII or IoT platforms) to correlate capital spend with measurable output gains.

With these insights, CFOs can re-prioritize deferred projects, uncover stranded capital, and direct future investment to the assets and lines that deliver the greatest operational leverage.

The CFO as a CapEx Strategist in Manufacturing

CapEx drives industrial growth, but without discipline oversight, it can result in inefficiency, delays, and missed opportunities. For manufacturing CFOs, CapEx is not just about budgeting and approvals; it’s about enhancing operational resilience, asset productivity, and competitive advantage.

SAP provides powerful financial control —from Investment Management (IM) to Asset Accounting (AA)—but CFOs must orchestrate a unified CapEx architecture that integrates planning, execution, and performance tracking. This includes structuring investment programs for transparency, digitizing CERs within SAP with master data validation and automated workflows and leveraging real-time reporting to track KPIs like CapEx-to-depreciation ratios, ROI by production line, and budget variances.

The most forward-thinking CFOs are extending SAP with integrated tools like IQX CapEx Management Fiori Apps to automate approvals and streamline execution. Cloud-based platforms like Stratex Online enable scenario planning, portfolio prioritization, and governance across the capital portfolio, providing CFOs with more strategic control.

By taking ownership of the full CapEx lifecycle—from strategy to settlement—CFOs can achieve true enterprise-level oversight and turn capital planning into a strategic advantage that drives performance and sustainable growth.