Engineering change management report 2012: Survey results on causes and effects, current practice, problems, and strategies in Brazil

Engineering changes (ECs) are well known for generating additional costs and decreasing de-velopment efficiency. Yet, they are a fundamental part of product and service development and they are necessary to keep up with, for example, competitors, market trends or new technolo-gies. The effective management of engineering changes is a crucial precondition for Brazilian companies to successfully compete not only on the fast growing Brazilian market, but also on the world market which becomes more interesting due to the rising industrial power of Brazil.

To achieve improvements in engineering change management practice, industry and universities need to work together. In this report the main findings of our study on Engineering Change Management (ECM) in Brazilian companies are presented, which indicate possible solution strategies and further research needs.

Our survey aimed on the investigation of current practice, the biggest challenges and potential strategies of engineering change management. A total of 55 Brazilian companies from a broad range of industry sectors and company sizes participated from December 2011 until January 2012 in the survey which was elaborated and conducted by members of the Universidade Fed-eral de Santa Catarina (UFSC, Brazil), Danmarks Tekniske Universitet (DTU, Denmark) and the Technische Universität München (TUM, Germany).

The results show an overview of current practice of ECM and how ECs affect all parts of an organization and the value-chain. In our analysis of the study, we furthermore explore the differences between average and critical changes. Survey results indicate that more than half of the overall R&D capacity in Brazilian companies is consumed by engineering changes, whereas about 40% of these changes are seen as critical changes that endanger allover project success.

As main causes for engineering changes, sur-vey participants indicate above all insufficient clarification of requirements and insufficient inter-nal communication, what points to the need for more support in communication and for transpa-rent definition of objectives. The top initiators of changes lie both in company external sources like the market (customers, end users, market trends) or restrictions (laws, regulation and certi-fication) and in the R&D department as internal initiator.

The latter bears potential to proactively reduce and avoid unnecessary changes. The predominantly positive seen effects of changes on the product (e.g. product quality and functionality) suggest successful implementation of the changes with respect to their main objectives named as ‘improving deficiencies of the product’ and ‘integrating innovations, new technologies and trends’.

While also the effect on people in-volved in the change process appears mainly positive, effects on process and costs show the negative aspects of engineering changes and reveal the importance of effective process and cost management within engineering change management. This issue seems still to be a problem in current practice of engineering change management in Brazilian companies.

A lack of methodological support for change processes and communica-tion is named as one of the biggest problems in handling changes. Main means of communica-tion are thereby indicated as electronic messaging (e.g. email) and face-to-face conversation (meetings, informal chats), while the usage of software systems to support formal processes is surprisingly low.

However, Brazilian companies are aware of the importance of formal processes and methods to manage engineering changes since the majority make use of several formal process steps for it. Favorite strategies to cope with engineering changes focus on early phases like the early detection of change needs and avoiding unnecessary changes, where further research is required.