ECM Overview-best Practices
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Assisting Companies Leverage Investments in SAP Solutions
Engineering Change Management Overview and Best Practices Eric Stajda and Shobhit Singhal
Agenda Assisting Companies Leverage Investments in SAP Solutions
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
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Agenda Assisting Companies Leverage Investments in SAP Solutions
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
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Definition of Change Management Man agement Process Assisting Companies Leverage Investments in SAP Solutions
There are different types of change management, including
Organizational Change Management
Change
management is a systematic approac h to dealing wit h change, both from the perspective of an organization and on the individual level. A somewhat ambiguous term, c hange management has at least three different aspects, including: adapting to c hange, controlling c hange, and effecting c hange. A proactive approac h to dealing wit h change is at the core of all t hree aspects. For an organization, c hange management means defining and implementing procedures and/or tec hnologies to deal wit h changes in the business environment and to profit from c hanging opportunities.
What we are focusing on in this presentation is product change management
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Definition of Change Management Process Assisting Companies Leverage Investments in SAP Solutions
To start with, a standard definition of change management
The Change
Management process in Systems Engineering is t he process of requesting, determining attainability, planning, implementing and evaluation of c hanges to a system. It has two main goals: supporting t he processing of changes and enabling traceability of c hanges, which should be possible t hrough 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
Etc.
Order)
Despite the different acronyms, all change management process have the same goal in mind
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Controlling
and implementing c hanges in a controlled fas hion
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Issues and Goals Assisting Companies Leverage Investments in SAP Solutions
While many businesses will have change management processes, they are always striving to improve
Current issues with change management processes include
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Still working from paper forms
Current
Current
Limited scope (ex:
Not
Process is not lean
Cycle
Extended supply chain not integrated wit h process
No
Visibility of change history limited
electronic system does not offer required capabilities
electronic system not integrated wit h other areas of organization (ex: Manufacturing) Only
control c hange to drawings)
appropriately workflow enabled
time is long
ability to measure KPIs, business metrics, etc.
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Issues and Goals Assisting Companies Leverage Investments in SAP Solutions
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 c hanged
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 wit h workflow doing t he heavy lifting
Simplify the process
Reduce
Improve collaboration during c hange and implementation process
Eliminate errors
Reduce
cycle time
costs based on miscommunication (ex: W rong revision
built)
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Better internal/external communication of c hange
Paper-free process
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Industry Standard Change Management Processes Assisting Companies Leverage Investments in SAP Solutions
There are a number of groups offering standardized ways of doing change management, including
CM II ± Institute of Configuration Management
improvement in ability to "c hange faster and document better." CMII evolved into a met hodology for accommodating change and keeping (1) requirements clear, concise and valid, and (2) records and data accurate. Wikipedia offers a glimpse of standard process
Continuous
are six main activities, which jointly form the change management process. They are: Identify potential c hange, Analyze change request, Evaluate change, Plan change, Implement change and Review and close c hange. These activities are executed by four different roles Book: ³Analysis on Engineering Change Management Based on Information Systems´
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There
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 p hases of the product lifecycle. With the application of information systems in enterprises, it becomes an urgent problem to run integrated engineering c hange management« Page 7
Industry Standard Change Management Processes Assisting Companies Leverage Investments in SAP Solutions
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
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Typical Change Management Processes Assisting Companies Leverage Investments in SAP Solutions
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 c hanges as a way of capturing additional profits against a given contract
Planning of Engineering Change
ECR © 2010 LeverX
Implementation of Engineering Change
ECO
Release of
Engineering Change
ECN Page 9
Typical Change Management Processes Assisting Companies Leverage Investments in SAP Solutions
Example 1 ± Simple change management process
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Simplicity is based on number of approvers, objects controlled, groups involved in implementation, etc.
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Typical Change Management Processes Assisting Companies Leverage Investments in SAP Solutions
Example 3 ± Much more complex, just a few steps of the overall process
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Difference Between ECM and PCM Assisting Companies Leverage Investments in SAP Solutions
In many companies, the change management process is split into to distinct processes
Engineering Change Management (E CM)
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 t he
Doing an analysis of the change
change
Approving it
Making updates to drawings, B OMs, specifications, etc.
Completing
Releasing
a final review
data from t he engineering group
Data is often ³thrown 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!)
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Difference Between ECM and PCM Assisting Companies Leverage Investments in SAP Solutions
PCM occurs when the Manufacturing or other groups receives the change and begins implementing
You
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Extending material master views to plants pdating production B OMs
Disposition of goods
Preparing the manufacturing floor to be able implement change
Ordering
Contacting
Etc.
goods partners about t he change
may be doing PCM for multiple plants or different groups
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Difference Between ECM and PCM Assisting Companies Leverage Investments in SAP Solutions
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 t he change being involved in t he change process early on this avoids the ³throw 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 t he change
Ex: ow soon can production BOMs and other information be updated? W hy wait?
Goal: One change record from start to finish that connects ECM and PCM activities
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Easy to see where change started and where it ended
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Change Management in SAP Assisting Companies Leverage Investments in SAP Solutions
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
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Bills of Materials
Documents
Materials
Variant Configuration Information
Task
(note: Key objects are listed above« there are many ot hers)
Lists
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Change Management in SAP Assisting Companies Leverage Investments in SAP Solutions
When changing an object in SAP, you always have the option of adding a change number
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Change Management in SAP Assisting Companies Leverage Investments in SAP Solutions
History of every change to the associated objects is recorded
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Change Management in SAP Assisting Companies Leverage Investments in SAP Solutions
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
c hanges are released based on validity date
Solution Use
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SAP Change Masters as the change record
Some use of SAP Workflow
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Change Management in SAP Assisting Companies Leverage Investments in SAP Solutions
A view of the SAP Change Master
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Change Management in SAP Assisting Companies Leverage Investments in SAP Solutions
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 t hat an engineering c hange is necessary, an Engineering Change Request (ECR) is created on t he basis of the change notification and bot h objects are linked afterwards. Now the affected objects (for example, documents, B OMs) are assigned. This can be done using drag drop if t he integrated product structure browser is used. Now the internal c hange process for the selected objects is started. In the next optional step, the feasibility and necessity of t he change can be c hecked by responsible agents for all objects affected. If all objects can be c hanged, the approval process can be started. Now all departments affected by t he change can be involved. Viewing and Redlining can be used to v iew documents and to provide feedback electronically during t he 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 c hanges do not become effective until t he responsible agent in configuration management has released the ECO. With the release, c hanges 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 p hased release, which allows the release for different areas, suc h as costing or production, step by step. If changes are released for running production orders, t he Order Change Management (OCM) process is triggered. In t his process, changes can be adopted to running production orders in a controlled process taking into account t he current status of t he production order.
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Change Management in SAP Assisting Companies Leverage Investments in SAP Solutions
ECR/ECO process (general flow)
Identify Change Required
Reject ECR
Prepare Request Forms
No
Create ECR with all associated objects; attach accompanying docs
Approve ECR?
Create/approve new Doc Versions
Get Signatures
Yes
Process BOM And Rtg changes
Verify Object Changes
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Prepare all Red Line Markups With Pkg
Close ECO
Release ECO
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Change Management in SAP Assisting Companies Leverage Investments in SAP Solutions
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
Change
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objects are add to the change and then approved
do not happen to the objects until c hange 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 wit h the change master, you can use SAP W orkflow for routing of the change
Digital signature used to control c hange status changes
Disadvantage: System status network is not c hangeable and process must be followed as defined by SAP
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Change Management in SAP Assisting Companies Leverage Investments in SAP Solutions
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 c hange processes are often critical and lengt hy (e.g. Pharmaceutical, aerospace etc)
Common Steps:
identification can be anyone in t he 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
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Change
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Change Management in SAP Assisting Companies Leverage Investments in SAP Solutions
A view of the a change notification
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Change Management in SAP Assisting Companies Leverage Investments in SAP Solutions
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
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Change Management in SAP Assisting Companies Leverage Investments in SAP Solutions
More complex, utilizing notifications and change master or ECR/ECO together ± (example flow)
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Change Management in SAP Assisting Companies Leverage Investments in SAP Solutions
Advantages and disadvantages of each approach
Simple Change Master process Easy to setup Less over head Fastest process Best suited for design phase Change history is comprehensive Change
not
collaboration is informal and optional Any errors are usually discovered after the implementation
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ECR/ECO process ood change history documentation More controlled process Allows better collaboration Allows greater flexibility in change process Less errors Best suited for production phase 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 elps in meeting regulatory requirements more efficiently
Takes
ardest and longest to setup Maintenance over head
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Change Management in SAP Assisting Companies Leverage Investments in SAP Solutions
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 w ith a Change Master or ECR/ECO
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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
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Utilizing SAP Workflow Assisting Companies Leverage Investments in SAP Solutions
What is SAP Workflow?
Very
powerful is used correctly
SAP Business Workflow can be used to define business processes t hat are not yet mapped in the R/3 System. These may be simple release or approval procedures, or more complex business processes suc h as creating a material master and the associated coordination of t he 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 t he involvement of a large number of agents in a specific sequence.
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
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Utilizing SAP Workflow Assisting Companies Leverage Investments in SAP Solutions
Can be used to drive the entire change process from change request creation to approval to change implementation to change notification
Yes,
the workflow supports the following
Workflow notifications sent to
Deadlines for tasks
Ex: A requestor input a c hange that involves product XYZ once saved, based on the changing product correct notification is sent to the manager in charge of identified product
Outlook
inbox
Ability to do ³ad hoc´ 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
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Example Implementations ± High Tech Assisting Companies Leverage Investments in SAP Solutions
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
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Example Implementations ± Automotive Supplier Assisting Companies Leverage Investments in SAP Solutions
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 i dentification 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
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Example Implementations ± Medical Devices Assisting Companies Leverage Investments in SAP Solutions
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
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Ex: If changing object A, you must c hange object B
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