Status of engineering change management in the engineer-to-order production environment: insights from a multiple case study

Figures & data

Table 1. Theoretical framework for ECM.

		ECM strategies
		Less	Earlier	Effective	Efficient	Better
	ECM practices and tools	S1	S2	S3	S4	S5
ECM practices	P1 – Establishment of a clear ECM process			✓	✓	✓
	P2 – Appointment of a coordinator of EC activities			✓	✓
	P3 – Establishment of a cross-functional team to work on ECs		✓	✓	✓
	P4 – Separate meetings to work on ECs			✓	✓
	P5 – Development of several solutions to ECs			✓	✓
	P6 – Involvement of production early in the design and engineering process	✓	✓
	P7 – Involvement of the suppliers early in the EC assessment and implementation process and cross-enterprise ECM process		✓	✓	✓
	P8 – Assessment of EC impacts on time and cost			✓
	P9 – Documentation and centralised access to EC status and history			✓	✓	✓
	P10 – Formal post-implementation review of ECs					✓
	P11 – Making decisions regarding ECs at the lowest possible level				✓
	P12 – EC implementation by urgency				✓
	P13 – Batch implementation of ECs				✓
Computer-based tools to support ECM	T1 – Dedicated IT systems for ECM			✓	✓	✓
	T2 – Configuration Management Systems		✓	✓	✓	✓
	T3 – PDM/PLM systems			✓	✓	✓
Change reduction and front-loading tools	T4 – Quality Function Deployment (QFD)	✓	✓
	T5 – Failure Mode and Effect Analysis (FMEA)	✓	✓
Design tools	T6 – Design for Manufacturing and Assembly (DfMA)	✓	✓
	T7 – Design for Changeability (DfC)	✓			✓
	T8 – Design freeze	✓
Change propagation and impact assessment tools	T9 – Change Prediction Methods (CPMs) and Design Structure Matrices (DSMs)		✓	✓

Figure 1. Research process.

Table 2. Sources of data.

	Interviews
Company	Respondents	Researchers present	Duration	Company’s internal documents	Additional sources
A	Two project managers, project planner, deputy CEO/chief market and innovation	Main author	3 hours	Change management procedure description, change order request form, change evaluation spreadsheets	Plant tour, company website, company presentations, reports from previous projects with the company conducted in the research group
B	Two project managers	Main author	3 hours	Change request and implementation procedure description, change order request form	Plant tour, company website, company presentations, reports from previous projects with the company conducted in the research group
C	Vice president project, project manager/senior order coordinator, master planner	Main author, senior researcher, junior researcher	2.5 hours	Change-handling procedure description, change order request form	Plant tour, company website, reports from previous projects with the company conducted in the research group
D	Technical manager	Main author, junior researcher	3 hours	Change-handling procedure description	Plant tour, company website
E	Project manager, purchasing manager and engineer, production manager, sales engineer	Main author, senior researcher, junior researcher	2 hours	Change-handling procedure description	Plant tour, company website, reports from previous projects with the company conducted in the research group

Table 3. Characteristics of case companies.

	Case company
Case company characteristics	A	B	C	D	E
Products	Ships	Power electronic equipment (propulsion, uninterruptible power supply, and low voltage distribution systems)	Systems for propulsion, positioning and manoeuvring of vessels	Pressure vessels	Hydraulic systems
Customers	Ship owners or investors operating in the offshore market	Oil and gas, and shipbuilding industry	Ship owners and shipbuilding companies	Offshore, onshore, chemical and process industries	Offshore, maritime and land-based industries
Company size (number of employees)	Large (600)	Large (275)	Large (318)	Small (48)	Medium (79)
Production volume per year	<1	50	200–300	20	300
Project delivery time, month	24	4–6	2.5-3	2–12	1–6
Number of ECs per project	up to 1000	up to 10	2	< 1	< 1
Number of ECs per year	≈ 500	≈ 500	≈ 400–600	≈ 20	≈ 300
End product complexity^a	High	Medium	Medium	Low	Low
End product customisation level^b	High	Medium	Medium	Medium-Low	Medium-Low
Type of procured components	Both standard and customised. Main equipment (engines, propellers, thrusters, on-deck equipment) is procured from suppliers and customised for each vessel.	Both standard and customised. 80% of procured parts and components are customised.	Both standard and customised. Steel plates for big thrusters, gearboxes and hydraulic cylinders are customised.	Both standard and customised. Most procured parts and components (steel plates and segregation equipment) are customized.	Purchased components are mostly standard.
Production processes	Mostly assembly processes. Some areas in the facility are dedicated to making sub-assemblies and components, using jobbing and batching methods.	Mostly assembly processes, where several products are being assembled at the same time. Some areas in the facility are dedicated to making sub-assemblies and components, using jobbing and batching methods.	Single product is moved between partially automated stations (steel cutting, bending, welding, heat treatments, painting, machining) to the assembly hull, where mechanical and electrical components are added. Some areas in the facility are dedicated to making sub-assemblies and components, using jobbing and batching methods.	Single product is moved between partially automated stations (plate cutting, welding, heat treatment) to the assembly hull, where mechanical and electrical components are added. Some parts are produced in batches using dedicated machinery.	Single product is moved between partially automated stations (cutting, milling, honing, grindings, machining, welding, surface treatment) to the assembly, where all purchased components are added. Some parts are produced in batches using dedicated machinery.
Production process uncertainty^c	High	High	Medium	Medium-Low	Medium-Low

^aDetermined as a number of BOM levels in the final product: High >1000, Medium 500–1000, Low <500.

^bAll companies have a segment of standard products, but only customised products were considered in the study. The degree of customisation is characterised as (Zorzini et al. 2008): Low – different configurations of common parts with some limited customisation; Medium – some truly customised parts (largely based on previous projects); High – a completely new design.

^cEstimated and qualitatively based on plant tour observations: High uncertainty – mainly assembly or jobbing, highly labour-intensive processes; Medium uncertainty – equal amount of assembly, jobbing and batch processes, dedicated machinery and manual labour are used equally; Low uncertainty – mainly batch processes with dedicated machinery.

Table 4. Use of strategies, practices and tools for management of ECs in the case companies.

		Use of ECM practices and tools in the case companies
	ECM practices and tools	Company A	Company B	Company C	Company D	Company E
ECM practices	P1 – Establishment of clear ECM process	Yes, based on ISO standard.
	P2 – Appointment of coordinator of EC activities	Yes, project manager is appointed as coordinator of EC activities.
	P3 – Establishment of cross-functional teams to work on ECs	Partially. Project manager involves project team representative if s(he) deems it necessary.
	P4 – Separate meetings to work on ECs	Yes	Partially. Engineering changes are discussed during the project status meetings.		No	No
	P5 – Development of several solutions to ECs	No	No	No	No	No
	P6 – Involvement of production early in the design and engineering processes	To a very limited extent. Some attempts were made to involve production, but without any deliberate approach.	No	To a very limited extent. Some attempts were made to involve production, but without any deliberate approach.	No	No
	P7 – Involvement of the suppliers early in EC assessment and implementation process and cross-enterprise ECM process	Partially. Suppliers are contacted if the change propagate to purchased components. No cross-enterprise EC process.
	P8 – Assessment of EC impacts on time and cost	Yes, assessment is largely based on the experience of the project manager and project team.
	P9 – Documentation and centralised access to EC status and history	No common database	Partially. Common cloud storage shared folder for EC documents. No EC tracking and status updates.	No common database	Partially. Common cloud storage shared folder for EC documents. No EC tracking and status updates.	No common database
	P10 – Formal post-implementation review of ECs	No, but ECs are sometimes discussed during the final project meeting.
	P11 – Making decisions regarding ECs at the lowest possible level	Yes. Decisions regarding ECs are made on different managerial levels depending on the monetary size of the change.
	P12 – EC implementation by urgency	No	No	No	No	No
	P13 – Batch implementation of ECs	No	No	No	No	No
Computer-based tools to support ECM	T1 – Dedicated IT systems for ECM	No	No	No	No	No
	T2 – Configuration Management Systems	To a very limited extent. Product configurator is used to find prices of different parts, components and systems.
	T3 – PDM/PLM systems	No.	PLM software is used by the company, but without ECM functionality.		No	No
Change reduction and front-loading tools	T4 – Quality Function Deployment (QFD)	No	No	No	No	No
	T5 – Failure Mode and Effect Analysis (FMEA)	No	No	No	No	No
Design tools	T6 – Design for Manufacturing and Assembly (DfMA)	To a very limited extent. Some attempts were made to involve production, but without any deliberate approach.	No	To a very limited extent. Some attempts were made to involve production, but without any deliberate approach.	No	No
	T7 – Design for Changeability (DfC)	Partially. Product platform is developed for the standardised ship segment.	No	Yes. Product is modular.	No	Partially. Modular design is used, but not for the main part of the product.
	T8 – Design freeze	Partially. ECs from customers accepted after the design freeze.
Change propagation and impact assessment tools	T9 – Change Prediction Methods (CPMs) and Design Structure Matrices (DSMs)	No	No	No	No	No

Table 5. ETO characteristics influencing ECM practices and tools.

ECM practice or tool	Influencing company characteristics	Description	Case observations
P5 – Development of several solutions to EC	Level of customers’ technical expertise	Characterises technical expertise of customers as their ability to translate their requirements into technical specifications	High in cases B, C, D Low in cases A, E
	Time pressures	Characterises pressures due to time-limited projects, constantly advancing project activities and project team involvement in several parallel projects	All cases
P7 – Involvement of the suppliers early in EC assessment and implementation process and cross-enterprise ECM process	Nature of relationships with suppliers	Represents the cooperativeness and power balance in relationships between a production company and its suppliers	All cases
P8 – Assessment of EC impacts on time and cost	Overlapping design, engineering, production and procurement activities	Characterises the extent to which design, engineering, production and procurement activities are performed simultaneously to shorten delivery times	All cases
	Product complexity	Characterises the depth of product structure, determined as the number of levels in a product’s bill of material	High in case A Medium in cases B, C Low in cases D, E
	Product customisation level	Characterises the extent to which a product is tailored to a customer’s requirements	High in case A, Medium in cases B, C Medium-Low in cases D, E
	Production process uncertainty	Represents uncertainty of production process specifications and durations due to production methods used and production labour intensity	High in cases A, B Medium in case C Medium-Low in cases D, E
	Nature of relationships with suppliers	Represents the cooperativeness and power balance in relationships between a production company and its suppliers	Cases A, B, C and D
	Customisation level of procured components	Characterises the extent to which an externally procured component is tailored to a customer’s requirements	High in cases A, B, C, D Low in case E
	Experience of a project team	Characterises the ability of project team members to implement ECs effectively and efficiently	All cases
P10 – Formal post-implementation review of ECs	Production process uncertainty	Represents uncertainty of production process specifications and durations due to production methods used and production labour intensity	High in cases A, B Medium in case C Medium-Low in cases D, E
T7 – Design of Changeability (DfC)	Product complexity	Characterises the depth of product structure, determined as the number of levels in a product’s bill of material	High in case A Medium in cases B, C Low in cases D, E
	Production volume	Specifies the number of products the company produces per year	All cases
T8 – Design freeze	Business strategy	Characterised by the company’s desire and ability to satisfy customer requirements at any stage of the project as a part of the services provided	All cases

Table

ECM practice/tool	Influencing ETO characteristics	Examples	Respondent
P5 – Development of several solutions for EC	Level of customers’ technical experience	‘Our customers, such as [ … ], usually provide us with exact descriptions of the change, they give us technical specifications, we just need to do it’.	Project manager, Company E
	Time pressures	‘[ … ] the philosophy is that it is better to have fast decisions that are ok, then not to have any or to spend too much time looking for an excellent solution. It is about the schedule, we need to stay on track. Delivery delays are a disaster for us and for our customers’.	Project manager, Company A
		‘Engineer allocation can also be a challenge in case of ECs: should an engineer start working on several solutions to an EC and delay work on other ongoing projects?’	Project manager/senior order coordinator, Company C
P7 – Involvement of the suppliers early in EC assessment and implementation process and cross-enterprise ECM process	Nature of relationships with suppliers	‘We do collaborate with suppliers, we ask them for the delivery time and cost estimation if an EC influences them somehow. There are many suppliers that we use all the time. But we are not 100% sure that we will always work with them. And also, we can’t share all the information with them’.	Project manager, Company A
P8 – Assessment of EC impacts on time and cost	Overlapping design, engineering, production and procurement activities	‘Our strategy is to start production before detailed design is finished to reduce total production time. [ … ] Drawings to production are released early and sometimes must be recalled if an EC happens. Sometimes something that we already ordered needs to be changed as well. This takes time and effort’.	Deputy CEO/chief market & innovation officer, Company A
	Product complexity	‘One of the problems with product change is that the project team often doesn’t see all the consequences of it. We are pretty good in estimating it, but there are some consequences that are difficult to see because, for example, it goes from one part to another, and then to another, different engineering disciplines get involved. There is always, always something that is being forgotten’.	Project manager, Company A
	Product customisation	‘If an EC is introduced to something new, like new solution or technology, the EC impact estimation is very difficult to do because we don’t have enough experience’.	Project manager/senior order coordinator, Company C
	Production process uncertainty	‘It is difficult to evaluate the change order, depending on how far the production have gone. At late stages like assembly, there is a lot of manual labour involved, some people can work slower than others’.	Project manager, Company B
	Nature of relationships with suppliers and customisation level of procured components	‘We order already formed heads for tanks from suppliers, some suppliers are outside Norway. These heads are customised, and the suppliers have much bigger orders from other customers, so they prioritise those orders. We have little negotiation power in this case. We don’t really know how much time they need to produce a new head’.	Technical manager, Company D
	Reliance on experience of project team	‘It’s good to have the experience. And it is funny to see that first guess is often pretty close to the result [ … ] That is a challenge because we don’t know how to give the key competence to the next generation. But it also has been a strength in the past. It is also why not everything is described and used as this guidance for each project. It is based on … really based on a lot of experience. It is a challenge, but also a strength’.	Project manager, Company A
P10 – Formal post-implementation EC review	Production process uncertainty	‘We have thought about it [performing post-implementation review]. We wanted to do this. And technical engineers and I were writing hours that we used for a specific change. But the assembly didn’t. In assembly it is difficult to distinguish which tasks are related to the specific EC and which are not. Maybe we can do it for big changes, but for small changes it will be too expensive. In part production is easier, we know machining processing times there’.	Project manager, Company B
T7 – Design of Changeability	Product complexity and production volume	‘We have two kinds of project types: one is the prototype, another one, as we call it, catalogue or system vessel. In the prototype we can think about 4–6 months from contract to production start. In catalogue we can say from 1 to 2 months because we have a platform solution with modules the customer can choose from. Much less engineering here. Prototype vessels are often made only once, they are more advanced, more tailored to customers, more new solutions are used there’.	Project manager, Company A
T8 – Design freeze	Business strategy	‘[ … ] one of our main challenges is that we are not able to put down a rigid enough plan for design freezes. We are very often so customer-centric, which sounds positive, but for us it is negative because we are pushed out in time because customers don't know exactly what they want. They need more time to decide. And then we should have been firmer in saying, “Now it is a design freeze. You have to decide, and if you are changing later, then it is a change order, influencing the complete contract”’.	Deputy CEO/chief market & innovation officer, Company A

Zorzini, M, L Hendry, M Stevenson, and A Pozzetti. 2008. “Customer enquiry management and product customization: An empirical multi-case study analysis in the Italian capital goods sector.” International Journal of Operations and Production Management 28 (12): 1186–1218.

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