Engineering Change Management - Overview and Best Practices

Assisting Companies Leverage
Investments in SAP Solutions
Engineering Change Management
Overview and Best Practices
Eric Stajda and Shobhit Singhal

Agenda
 Definition of Change Management Process
 Issues and Goals
 Industry Standard Change Management Processes
 Typical Change Management Processes
 Engineering Change Management (ECM) vs. Production Change
Management (PCM)
 Change Management in SAP
 Utilizing SAP Workflow
 Example Implementations
© 2010 LeverX Page 2

Definition of Change Management Process
 There are different types of change management, including
 Organizational Change Management
 Change management is a systematic approach to dealing with
change, both from the perspective of an organization and on the
individual level. A somewhat ambiguous term, change
management has at least three different aspects, including:
adapting to change, controlling change, and effecting change. A
proactive approach to dealing with change is at the core of all three
aspects. For an organization, change management means defining
and implementing procedures and/or technologies to deal with
changes in the business environment and to profit from changing
opportunities.
 What we are focusing on in this presentation is product change management

Definition of Change Management Process
 To start with, a standard definition of change management
 The Change Management process in Systems Engineering is the
process of requesting, determining attainability, planning,
implementing and evaluation of changes to a system. It has two
main goals: supporting the processing of changes and enabling
traceability of changes, which should be possible through proper
execution of a defined process.
 Businesses will refer to their change process under a variety of acronyms,
including
 ECR (Engineering Change Request)
 ECM (Engineering Change Management)
 ECN (Engineering Change Notice)
 ECO (Engineering Change Order)
 Etc.
 Despite the different acronyms, all change management process have the
same goal in mind
 Controlling and implementing changes in a controlled fashion

Issues and Goals
 While many businesses will have change management processes, they are
always striving to improve
 Current issues with change management processes include
 Still working from paper forms
 Current electronic system does not offer required capabilities
 Current electronic system not integrated with other areas of
organization (ex: Manufacturing)
 Limited scope (ex: Only control change to drawings)
 Not appropriately workflow enabled
 Process is not lean
 Cycle time is long
 Extended supply chain not integrated with process
 No ability to measure KPIs, business metrics, etc.
 Visibility of change history limited

Issues and Goals
 Implement a new change management process can be difficult, because it
requires a good deal of business change management
 Everyone is used to the same process and not easily changed
 Therefore, business goals and benefits should be identified early in the
project and well communicated
 Common business goals and benefits include
 Leaner process
 Automate process with workflow doing the heavy lifting
 Simplify the process
 Reduce cycle time
 Improve collaboration during change and implementation process
 Eliminate errors
 Reduce costs based on miscommunication (ex: Wrong revision
built)
 Better internal/external communication of change
 Paper-free process

Industry Standard Change Management Processes
 There are a number of groups offering standardized ways of doing change
management, including
 CM II – Institute of Configuration Management
 Continuous improvement in ability to "change faster and
document better." CMII evolved into a methodology for
accommodating change and keeping (1) requirements clear,
concise and valid, and (2) records and data accurate.
 Wikipedia offers a glimpse of standard process
 There are six main activities, which jointly form the change
management process. They are: Identify potential change,
Analyze change request, Evaluate change, Plan change,
Implement change and Review and close change. These
activities are executed by four different roles
 Book: “Analysis on Engineering Change Management Based on Information
Systems”
 Engineering Changes (ECs) are inevitable and frequent in
manufacturing enterprises. The primary challenge in efficient
management of ECs arises because the sources as well as
the effects of an EC are spread across different phases of the
product lifecycle. With the application of information systems
in enterprises, it becomes an urgent problem to run integrated
engineering change management…

Industry Standard Change Management Processes
 The previously mentioned standards are good if you are starting from scratch
or just looking for ideas on how to improve you current change management
process
 Sometimes looking outside the box gives us the best ideas
 The goal of implementing a change management process should not be to
just to shoehorn you existing process into an electronic system
 Look around and talk with other companies about their experiences

Typical Change Management Processes
 In the end, most companies have similar change management processes with
minor deviations
 Everyone has a way to request change and how to implement a change
 There are varying degrees of success and complexity
 Some industries are much more complex and regulated
 Ex: Medical device companies must meet validation and FDA
requirements when making changes
 Ex: Auto suppliers use changes as a way of capturing additional
profits against a given contract
Planning of
Engineering
Change
Implementation
of Engineering
Change
Release of
Engineering
Change
ECR ECO ECN

 Example 1 – Simple change management process
 Simplicity is based on number of approvers, objects controlled,
groups involved in implementation, etc.

 Example 2 - More complex process flow for engineering and production
change management
SUBMIT
Evaluate
(Facilitator)
Review
(Change Board)
Create ECR
(Initiator)
Define Components
(Facilitator)
Design
Work
Review Release Implemented
Last Edited
04-26-06
REV, K
Change Board Signatures
•Design Engineer
•Manufacturing Engineer
•Quality Engineer -PS&AE
Signatures
Senior
Mfg. Eng
Engineering Central - ECR/ECO Lifecycle Guide
Select:
•Product Line
•Facilitator
•Description
•Reason for
Change
•Project #
•Attach Specs
to be
Revised
•Attach Parts
to be
Revised
•Promote ECR
Automatic
e-Mail is
sent to the
Facilitator
•Reviews
proposed
change
•Reviews
supporting
documentation
•Adds any
additional
supporting
documentation
if needed.
•Create ECR
approval route
if needed.
•Promote ECR
to Review –
only when any
approval routes
are completed.
Automatic e-mail
sent to Change
Board
Create Spec & Part
Routes as needed.
When notified that
routes are
complete:
1) Check that Specs
are in the Review
state.
2) Promote Parts to
the Review state
3) Promote ECO to
Design Work
state.
•Review
all work
•Approve
ECO
only
• Review
each
object
•Bulk
Promote
all Specs
and Parts
to the
Approved
state.
• Review &
Approve
ECO
• ECO is
automatically
promoted to
the
IMPLEMENTE
D state.
• Distribution
Groups are
notified.
IF AUTO-CREATED:
• Assign Mfg. Eng.
• Set Priority
• Set Release Distro-
Group
IF NEW RELEASE
ALSO:
• Set ECO Description
• Assign Design Eng
• Connect Spec & Part
• Connect Files and/or
Drawing Markups, if
required
• Assign Project #
• Create Approval
Route on ECO.
• Promote ECO to Define
Components
Create ECO
•Automatic from ECR or
•Manual (if new)
Signatures
Senior
Design Eng
System
automatically
creates New
Preliminary
Revisions of
Attached
Spec & Parts
•Create &
Attach
Markups
•Check in any
supporting
documentation
•Promote to
Evaluate
•Once the
Change Board
Approves –
The ECR is
automatically
promoted to
the Plan ECO
state.
•Automatic creation of ECO
•Automatic Attachment of
all Preliminary Specs &
Parts
•Automatic ownership
change of all connected
objects to the
Responsible Design
Engineer
•ECO is Automatically
Related to the ECR
CompletePlan ECO
ECR Automatically Promotes to Complete, When All Related
Objects (ECO, SPECS & PARTS) and Routes Meet Completion Requirements.
•Verify that
All Related
Objects
(ECR,
SPECS &
PARTS) are
Released
and routes
are Finished.
•Promotes
ECR to
Complete
state if
appropriate.
Note:
1.Drawing Markup Objects are
promoted to Implemented (locked)
when the ECO is promoted from
the Create to Define Components
State. No changes can be made to
them.
2. If Drawing Markups are added in
the Define Components State, the
lock will occur when promoted to
Design Work.
•INITIATOR or FACILITATOR
•FACILITATOR
•APPROVER or CHANGE BOARD
•AUTO GENERATED
•APPROVER or FACILITATOR

 Example 3 – Much more complex, just a few steps of the overall process

Difference Between ECM and PCM
 In many companies, the change management process is split into to distinct
processes
 Engineering Change Management (ECM)
 Production Change Management (PCM)
 The ECM process is usually all of the activities from initiation of change up
until the release of engineering data to various groups
 Requesting the change
 Doing an analysis of the change
 Approving it
 Making updates to drawings, BOMs, specifications, etc.
 Completing a final review
 Releasing data from the engineering group
 Data is often “thrown over the wall” to ancillary groups (manufacturing,
purchasing, etc.) to implement the change
 Downside – not efficient due to other groups were not involved in the change
during the engineering process (surprise!)

 PCM occurs when the Manufacturing or other groups receives the change
and begins implementing
 Extending material master views to plants
 Updating production BOMs
 Disposition of goods
 Preparing the manufacturing floor to be able implement change
 Ordering goods
 Contacting partners about the change
 Etc.
 You may be doing PCM for multiple plants or different groups

 Our recommended best practice is to have one change management process
that includes both the ECM and PCM process
 This means having the groups implementing the change being
involved in the change process early on – this avoids the “throw it
over the wall” syndrome
 A few rules when combining the ECM and PCM process
 Down stream groups should be involved in the approval process or at least
on the distribution list
 Visibility of what is coming
 Activities that down stream groups need to do are started as soon as
possible
 Do not just start at release of the change
 Ex: How soon can production BOMs and other information be
updated? Why wait?
 Goal: One change record from start to finish that connects ECM and PCM
activities
 Easy to see where change started and where it ended

Change Management in SAP
 There are three basic options for implementing change management within
SAP
 Change Masters
 ECR/ECO Process
 Notifications with Change Masters
 What option you choose depends on the complexity of your process and
what you are trying to achieve
 Before we go into each option, it should be said that what each option is
actually doing is controlling changes to SAP objects and recording the
history
 The key SAP objects which are controlled in the change process are
 Bills of Materials
 Documents
 Materials
 Variant Configuration Information
 Task Lists
 (note: Key objects are listed above… there are many others)

 When changing an object in SAP, you always have the option of adding a
change number

 History of every change to the associated objects is recorded

 The simple change process
 Very few participants in the change process
 Linear process with not much collaboration
 Not much workflow
 Changes can be made immediately and released at a defined date in
the future
 Common steps
 Change definition – usually comes from supervisors/managers
 Change approval – usually verbal/ paper based.
 Change execution – most advanced users have authorization to
change objects without formal process
 Change release – changes are released based on validity date
 Solution
 Use SAP Change Masters as the change record
 Some use of SAP Workflow

 A view of the SAP Change Master

 A more controlled process – SAP ECR/ECO
 The SAP ECR/ECO is very similar to the change master
 Additional controls and system status network is added on top of the
change master
 From SAP help:
If the decision is made that an engineering change is necessary, an Engineering Change
Request (ECR) is created on the basis of the change notification and both objects are
linked afterwards. Now the affected objects (for example, documents, BOMs) are
assigned. This can be done using drag & drop if the integrated product structure browser
is used. Now the internal change process for the selected objects is started.
In the next optional step, the feasibility and necessity of the change can be checked by
responsible agents for all objects affected. If all objects can be changed, the approval
process can be started. Now all departments affected by the change can be involved.
Viewing and Redlining can be used to view documents and to provide feedback
electronically during the process. If everybody has approved the changes, the ECR can
be converted into an Engineering Change Order (ECO) for the physical change of the
affected objects. Therefore, the objects are sent to the responsible agents who make the
changes. The changes do not become effective until the responsible agent in
configuration management has released the ECO. With the release, changes are
effective for the effectivity parameters, for example, valid-from-dates or serial numbers,
which are used in the ECO. The release itself can happen either in one step as a general
release or using a so called release key as a phased release, which allows the release
for different areas, such as costing or production, step by step.
If changes are released for running production orders, the Order Change Management
(OCM) process is triggered. In this process, changes can be adopted to running
production orders in a controlled process taking into account the current status of the
production order.

 ECR/ECO process (general flow)
Create ECR with all
associated
objects; attach
accompanying
docs
Prepare all
Red Line
Markups
With Pkg
Prepare
Request
Forms
Approve
ECR?
Reject
ECR
YesNo
Process
BOM
And Rtg changes
Close
ECO
Release
ECO
Get
Signatures
Identify
Change
Required
Create/approve
new
Doc Versions
Verify
Object
Changes

 When the ECR/ECO process is used
 The ECR/ECO process is used when a more controlled process for
making change is required
 Major difference – objects are add to the change and then approved
 Change do not happen to the objects until change are approved
 Validity date is not required up front – only when ready to implement
vs. change master immediately requires a suggested validity date for
the change
 As with the change master, you can use SAP Workflow for routing of
the change
 Digital signature used to control change status changes
 Disadvantage: System status network is not changeable and process
must be followed as defined by SAP

 More complex, utilizing notifications and change master or ECR/ECO
together
 Most collaborative and controlled process
 Process is designed to be extremely lean and system driven
 Workflow is used to do most of the heavy lifting
 Used by industries which are tightly regulated and change processes
are often critical and lengthy (e.g. Pharmaceutical, aerospace etc)
 Common Steps:
 Change identification – can be anyone in the organization
 Change definition – change is defined using SAP notification
objects which serve as base for collaboration and
documentation
 Pre-change review – manual or using SAP reports
(std./custom.)
 Change approval – formal, digital using SAP workflow
 Change execution – modular, driven by workflow
 Change release – automated release and notifications using
predefined business rules
 Note, the SAP Change Master or ECR/ECO is still used but is tied to the
Notification

 A view of the a change notification

 One of the major advantages to the notification is the use of tasks
 Allow for adhoc capability
 All changes do not %100 follow the same path

 More complex, utilizing notifications and change master or ECR/ECO
together – (example flow)
Page 27
Send entire
package to
Document Control
dept
Use workflow
tasks to
collaborate with
SMEs
Assign ECR
constructor, create
change notification and
ECR. Copy all
information from
request notification to
change notification
Requestor creates
request
notification
Identify Change
Required
Yes
Sponsor reviews
request notification
No
Doc Ctrl checks
package
Needs changes
Start approval
workflow
Ok
Send back to Doc
Control
Approver reviews
package
Not Ok
Ok
Doc Ctrl
implements the
changes
Production change
management
workflow is
trigered
© 2010 LeverX, Inc.

 Advantages and disadvantages of each approach
Page 28
Simple Change
Master process
• Easy to setup
• Less overhead
• Fastest process
• Best suited for design
phase
• Change history is not
comprehensive
• Change collaboration is
informal and optional
• Any errors are usually
discovered after the
implementation
ECR/ECO process
• Good change history
documentation
• More controlled
process
• Allows better
collaboration
• Allows greater flexibility
in change process
• Less errors
• Best suited for
production phase
• Takes longer to setup
• Change process tends
to be longer
ECR/ECO with
notifications and
digital signatures
• Best change
documentation
• Extremely controlled
and guided process
• Best collaboration
• Process can be as
flexible as required
• Minimum chances of
error
• Helps in meeting
regulatory requirements
more efficiently
• Hardest and longest to
setup
• Maintenance overhead
© 2010 LeverX, Inc.

 Our recommended approach is to have a balanced process depending on
business requirements and industry
 If process requires, our best practice is to utilizing notifications with a
Change Master or ECR/ECO
 This offers the most functionality and has been successfully
implemented by LeverX and SAP at a number of customers
 Variety of industries, including automotive and medical
devices

Utilizing SAP Workflow
 What is SAP Workflow?
 SAP Business Workflow can be used to define business processes that are not yet
mapped in the R/3 System. These may be simple release or approval procedures, or
more complex business processes such as creating a material master and the
associated coordination of the departments involved. SAP Business Workflow is
particularly suitable for situations in which work processes have to be run through
repeatedly, or situations in which the business process requires the involvement of a
large number of agents in a specific sequence.
 Very powerful is used correctly
 Issue – companies attempt to overcomplicate the workflows, adding to
many bells and whistles, causing future support issues
 The role of workflow is two-fold
 Inform users of activities they need to perform as the change moves
along its lifecycle
 Send updates about the status changes and events to interested users
 Escalation rules and task forwarding can be easily setup to enhance process
 Adds slight maintenance overhead which must be taken into account during
implementation

Utilizing SAP Workflow
 Can be used to drive the entire change process from change request creation
to approval to change implementation to change notification
 Ex: A requestor input a change that involves product XYZ – once saved,
based on the changing product correct notification is sent to the manager
in charge of identified product
 Yes, the workflow supports the following
 Workflow notifications sent to Outlook inbox
 Deadlines for tasks
 Ability to do “adhoc” workflows from different SAP objects
 Maintaining substitutes when on vacation or out of the office
 Escalation of tasks based on rules
 As an implementation consideration, it suggested that staff be built up for
long term support and update of workflows

Example Implementations – High Tech
 Via ECR/ECO process controlled updates to documents, material masters,
and BOMs
 ECR/ECO process worked for them because of the strict system status
network
 Utilized SAP Workflow based on status changes

Example Implementations – Automotive Supplier
 Due to complexity of process, used notifications with change masters to
control updates to documents, BOMs, and material masters
 Full recording of change from initial identification of problem to release of
correction
 Used workflow for routing and approvals
 Able generate key business metrics based on status changes to see where
improvements could be made

Example Implementations – Medical Devices
 Very similar to previous example, used notifications with ECR/ECO to control
updates to documents, BOMs, and material masters
 More elaborate use of digital signatures to control release of items due to
FDA requirement
 Approvers automatically determined via business route
 Additional reports developed for checks and balances
 Ex: If changing object A, you must change object B

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