Engineering Change Orders (ECOs) are essential for managing product modifications, improving quality, and ensuring compliance in manufacturing and product development. For the last few weeks, I had more conversations about engineering and manufacturing change management and wanted to share some of my observations.
Inefficiency of ECO process can cause delays, cost impact and other disruption for engineering and manufacturing processes. Traditionally managed by either PLM or ERP systems, it usually represented by an organization (or meeting) called CCB – Change Control Board, which is taking care of reviewing and approvals. The work on people at CCB is burden by so many tasks and most of them are related to getting access to an appropriate information organized in a right way.
With a growing complexity of products and manufacturing processes, ability of the products to change their behavior using software I can see a growing number of challenges in ECO management. Dependencies on multiple system often makes CCB operation and ECO management “a step child” of many systems and organizations.
Modern data management tools provide a new approach in connecting data (eg. Graph Database, Language Models) and new online tools provide a level of real time data sharing and collaboration we haven’t seen 20-25 years ago when mainstream PLM/ERP systems were originally developed.
In the article today, I want to start from the question why an ECO process as we know is not good enough and what can be done to change it.
Five Key Challenges of ECO Management
I collected five key challenges related engineering change management and impact analysis tracking.
Lack of Visibility and Change Impact Awareness
One of the biggest challenges in ECO management is the lack of visibility into how a change will impact the entire product lifecycle. Engineering, manufacturing, and procurement teams often struggle to assess the full consequences of modifications, leading to production delays, supply chain disruptions, and unexpected quality issues.
Typically information is located in multiple systems – PLM, ERP, CRM, different databases controlled by maintenance, sales, and other organizations. While PLM was holding a promise to organize all information in a single source of truth, it is often a vision rather than a reality.
Without clear insight into dependencies and downstream effects, what seems like a minor design update can quickly escalate into costly and time-consuming rework.
Slow and Inefficient Approval Processes
Another major hurdle in ECO management is the slow approval process. Because change orders often require input from multiple departments—including engineering, quality assurance, and procurement—delays are common.
For most organization approval process is simply translated as a “workflow”. Most of “PLM workflows” look really nice when designed, but later are turning in a mess of routes, exceptions, phone calls and virtual meetings.
Many organizations still rely on a “document” to represent ECO, which is electronically (or manually) moved between people (sometimes in email and sometimes using project/task management tools). . Conflicting priorities among stakeholders further slow down decision-making, creating bottlenecks that extend project timelines and increase costs.
Poor Documentation and Fragmented Change Records
The key challenges is fragmented data in multiple systems. But managing ECOs requires detailed documentation, but the organization of this change records about items, dependencies, references, documents, etc. is hard. For larger organizations, you need to deal with PLM, ERP, CRM, and other records. For SMB/SME, add spreadsheets, and some other databases.
History of changes is even a bigger mess. When teams cannot easily access previous ECOs or understand why certain changes were made, mistakes are more likely to occur. A lack of structured documentation makes it challenging to maintain consistency, especially when dealing with complex product structures and regulatory compliance requirements.
Inadequate Risk Assessment and Unforeseen Consequences
A well-managed ECO process should involve a thorough impact analysis, yet many organizations fail to assess risks properly before approving changes. Without detailed evaluation, changes can lead to unanticipated cost overruns, production bottlenecks, and compatibility issues with existing components.
In some situations, inadequate risk assessment can trigger serious product malfunctions, cause cost in repairs, recalls, and sometimes can cause people lives. The failure to conduct a thorough consequence analysis can result in costly delays and inefficiencies that ripple through the entire production process.
Underestimating Costs and Budget Overruns
Many companies struggle to accurately estimate the costs associated with an ECO. While the direct cost of a design change might seem minimal, hidden expenses often emerge, including engineering and testing fees, supplier requalification costs, additional labor for manufacturing adjustments, and potential scrap or rework.
Without accurate cost projections, organizations risk approving changes that significantly impact budgets, leading to financial strain and resource allocation issues. A clear, data-driven cost assessment is essential to making informed decisions and avoiding unexpected expenses.
Integration of PLM and ERP for ECO Management
One of the most typical approach for organizations running multiple systems is to create an “integrated ECO process” Many organizations are finding value in integrating their PLM and ERP systems for more comprehensive ECO management:
- PLM systems manage the entire lifecycle of a product, including engineering changes, while ERP systems handle the business and operational aspects24.
- Integration of PLM and ERP can lead to reduced time-to-market, improved data accuracy, and enhanced decision-making.
Does it really work? I’ve seen a very successful examples of ECO management with organized dynamic reports and virtual change control boards. While I liked some of them, they look like Win95 to me. The user experience and data processing there is hardcoded and difficult.
Future Innovations in ECO Management
- AI-Powered Decision Making and Automation: Machine learning algorithms for material identification, predictive analytics, and automated routing of ECOs.
- Cloud-Based PLM and QMS Integration: Real-time collaboration, electronic ECO creation, and comprehensive audit trails.
- Blockchain for Enhanced Traceability: Immutable record-keeping of changes, improved supply chain visibility, and enhanced governance.
By addressing collaboration challenges and leveraging innovative tools, organizations can significantly improve their ECO management processes, leading to more efficient product development and manufacturing.
What is my conclusion?
The future improvement of change management in organizations might take a path of starting with data rather than a specific system. The technology for data collection, analysis, reasoning and traceability are achieving the levels not possible for existing PLM/ERP systems to compete with. But, as we always say, technologies are easy- people are hard. How to make a new user experience that will make people to adopt those systems is another question.
What will modern CCB look like in 5 years? The jury is out and looking for alternatives.
Just my thoughts…
Best, Oleg
Disclaimer: I’m the co-founder and CEO of OpenBOM, a digital-thread platform providing Collaborative Workspace with PDM, PLM, and ERP capabilities. With extensive experience in federated CAD-PDM and PLM architecture, I’m advocates for agile, open product models and cloud technologies in manufacturing. My opinion can be unintentionally biased.
