Purpose – The purpose of this paper is to increase the understanding of the impact of engineering changes on the materials planning process.Design/methodology/approach – This study is based on a conceptual discussion and empirical data from a case study of a supply chain in the automotive industry, including end producers (two OEM companies) and first, second and third tier suppliers.Findings – A framework comprising the situational dimensions of the engineering change was derived from the conceptual discussion and described in terms of product, supply, manufacturing, demand and materials planning characteristics. The empirical study shows the characteristics of the engineering change in the case company and how these have both positive and negative, as well as direct and indirect, influences on the materials scrap, administrative and transport/handling costs. The impact of the actual materials planning strategies is also shown. Another finding was that different engineering change situations exist within...

The impact of engineering changes on materials planning

Shortened product development times and more frequent product changes combined with product quality and timeliness of delivery are prerequisites of competitiveness. These have increased the workload and underscored the importance of effectively managing the materials planning process in engineering change situations. The purpose of this paper is to develop a procedure for creating a model to differentiate between items in order to facilitate the allocation of materials planning resources in change situations. It develops a procedure in the framework of the study and verifies it using the case study technique. Furthermore, the case study shows that there are many different engineering change situations that occur in the materials planning process. Many engineering change variables and materials planning variables have a major impact on the material scrap costs and material shortage costs, but only a few generate the different types of engineering change situations for the materials planning process. The case study shows that material scrap costs and material shortage costs decrease after the introduction of a tool to differentiate between items to facilitate the allocation of materials planning resources.

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Keith R. Plossl

Papers

Engineering for the control of manufacturing