Managing Design Change in Complex Production Development Project: A study at Scania Gearbox Assembly

TVE-MILI19004

Master’s Thesis 30 credits May 2019

Managing Design Change in Complex Production Development Projects

A Study at Scania Gearbox Assembly Beata Gradin

Master´s Programme in Industrial Management and Innovation

Masterprogram i industriell ledning och innovation

Abstract

Managing Design Change in Complex Production Development Project – A study at Scania Gearbox assembly

Beata Gradin

The speed of launching new products will accelerate and so the complexity of products and productions systems (Sorli et al 2006;

Windt et al., 2008). Change is a natural effect of product development and it offers opportunities to develop the related production (Jarratt et al, 2011; Lager, 2002). To increase the launching, simultaneous development projects with a multi-project structure can be initiated (Araszkiewicz, 2017). This results in transmitted design changes from the product development project into the related production development project. In turn, the production development project needs to manage these transmitted design changes.

The study has investigated how transmitted design changes shall be managed in production development projects. This was performed by exploring theoretical fields of Engineering Change and Project Management and collecting empirical data from a studied complex production development project at Scania DT.

A standardized Transmitted Design Change process is recommended to use in order to achieve better communication in- between the interdependent projects and manage change with respect to risk and without harming other processes. Furthermore, project management methodologies and its characteristics were discussed in order to support and facilitate the management of transmitted design changes. The study concludes that both flexible and traditional project management methodologies shall be adopted in these complex development projects with high levels of interdependencies. The combined strategy supports changes and uncertainties with flexible iterations and controls the projects with standardized processes and structure.

Supervisor: Karin Lundquist Subject reader: Åse Linné Examiner: David Sköld TVE-MILI19004

Printed by: Uppsala Universitet

Teknisk- naturvetenskaplig fakultet UTH-enheten

Visiting address:

Ångströmlaboratoriet Lägerhyddsvägen 1 House 4, Level 0

Postal address:

Box 536 751 21 Uppsala

Telephone:

+46 (0)18 – 471 30 03

Telefax:

+46 (0)18 – 471 30 00

Web page:

http://www.teknik.uu.se/student-en/

Keywords: Complex Project, Engineering Change, Production Development, Project Management, Simultaneous Development, Transmitted Design Change

Popular Science Summary

The importance of enabling transmitted design changes management will increase as the demand for short simultaneous development projects increases. The interdependency between a product development project and a production development project indicates that if something changes it will most certainty affect the other and vice versa. Therefore, interdependency and simultaneous project structures lead to transmitted design changes. Additionally, projects with frequent design changes result in high levels of project complexity which leads to difficulties in steering and planning a project.

This study contributes with new knowledge to production development projects in order to master transmitted design changes as a result of simultaneous work tasks and high levels of interdependency. The findings cover a strategy for announcing and managing the design changes, as well as recommendations about educating the project employees, suitable project management methodologies and new determined responsibilities for each individual project employee.

The study found that simultaneous activities, communication strategy, and the process of announcing and managing design change shall be standardized. The communication strategy is an important stage in the suggested strategy and should be performed on a regular basis with a shared responsibility between the interdependent projects; the product development project shall provide information and the production development project look for additional information needed. It is also suggested to adopt flexible project management methodologies to be able to manage unexpected and frequent changes. Flexibility can be achieved by iterations and the suggested iteration strategy will be carried out through learning stages between the design change management and during the selection of change solution. However, too complex development projects also need standardized processes and control. Therefore, a combined project management strategy is proposed, to enable flexibility in terms of iterations, but keep control by standardizing processes and using routines for the announcement and management of transmitted design changes. This will make complex development projects more efficient in manage design changes and less delays and late rework will occur.

Acknowledgement

It has been an honor to conduct my master thesis at Scania DT, Södertälje. I am sincerely grateful for the support all involved persons have provided me and the freedom to select a thesis topic of my interest. Therefore, I like to thank my principle, Karin Lundquist, at Scania DTTFA, who gave me this opportunity. You are a true inspiration and a very knowledgeable manager who have supported my work with accuracy, a lot of freedom and own responsibility. You have let me grow.

Furthermore, I would like to thank all respondents at Scania DT and Scania Improvement Office. Your words have been of great importance for strengthen the significance of this study and further studies in the field of managing transmitted design changes in production development projects.

Last but not least. I would like to thank my subject reader, Åse Linné, at Uppsala University who has been a good sounding board and supported me along my way. I have appreciated your equality among all students, your positivity and optimistic view, as well as your way of giving feedback.

Uppsala, 26^th April 2019

Beata Gradin

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Table of Content

1. INTRODUCTION ... 4

1.1. PROBLEMATIZATION ... 4

1.2. PURPOSE AND RESEARCH QUESTION ... 5

1.3. THE STUDIED PRODUCTION DEVELOPMENT PROJECT ... 5

1.4. DICTIONARY ... 6

2. THEORY ... 7

2.1. CHANGE ... 7

2.1.1. Engineering change ... 7

2.1.2. Change effect ... 11

2.2. PROJECT... 13

2.2.1. Project character... 13

2.2.2. Interdependencies ... 15

2.2.3. The effects of Project Management Methodology ... 17

3. METHOD ... 19

3.1. WORK PROCESS ... 19

3.2. RESEARCH IDEALS, STRATEGY AND DESIGN ... 20

3.2.1. Interviews ... 21

3.2.2. Scania documents ... 24

3.3. ANALYSIS METHOD ... 25

3.4. RESEARCH MEASUREMENTS ... 26

3.4.1. Reliability ... 26

3.4.2. Validity ... 26

3.4.3. Generalizability or particularization ... 26

3.5. BIAS AND PRE-KNOWLEDGE ... 27

3.6. ETHICS... 28

3.6.1. Interviews ... 28

3.6.2. Confidential material ... 28

3.6.3. Copyright ... 29

3.6.4. Managing the result ... 29

4. EMPIRICAL STUDY ... 29

4.1. SCANIA DOCUMENTS ... 30

4.1.1. Scania Engineering Change Order ... 30

4.1.2. Scania Project Management Methodologies ... 31

4.2. INTERVIEW RESULT ... 33

4.2.1. The project´s background ... 33

4.2.2. Level of interdependency ... 36

4.2.3. Direction of change ... 37

4.2.4. How design change affects production development ... 38

4.2.5. Effects of design change solution ... 41

4.2.6. Suggested improvement potential ... 41

4.3. EMPIRICAL SUMMARY ... 43

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5. ANALYSIS ... 43

5.1. INTERDEPENDENCY AND PROPAGATED CHANGES... 43

5.2. MAPPING DESIGN CHANGE ... 46

5.3. CHARACTERIZING THE PROJECT ... 50

5.3.1. Level of complexity ... 50

5.3.2. Support design change management... 51

5.4. HOW TO ENABLE DESIGN CHANGE MANAGEMENT? ... 53

6. CONCLUSION ... 55

6.1. RESEARCH QUESTION 1 ... 55

6.2. RESEARCH QUESTION 2 ... 57

6.3. RECOMMENDATIONS ... 59

6.3.1. Project Management Methodology support ... 60

6.3.2. Learning: pre-change ... 60

6.3.3. Announcing design change ... 61

6.3.4. Managing design change ... 61

6.3.5. Implement change ... 62

6.3.6. Learning: post-change ... 62

6.4. ACADEMIC CONTRIBUTIONS... 62

6.5. RESEARCH CREDIBILITY ... 64

6.6. DIFFICULTIES AND DELIMITATIONS ... 65

6.7. SUGGESTIONS FOR FUTURE STUDIES ... 65

REFERENCES ...66

APPENDIX ... 1

1.INTERVIEW GUIDE –BACKGROUND INTERVIEWS ... 1

2.INTERVIEW GUIDE –EMPIRICAL INTERVIEWS ... 2

3.INTERVIEW VISUALIZATION:DESIGN CHANGE PROCESS ... 3

4.TEMPLATE:SCANIA DESIGN CHANGE REPORT... 4

5.CHECKLIST:SCANIA DESIGN CHANGE MANAGEMENT ... 4

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Figures

Figure 1. Process of managing EC (Author’s own illustration) ... 8

Figure 2. The generic engineering change process, (Jarratt et al., 2011, p. 107) ... 10

Figure 3. Stacey Matrix (Author’s own illustration of Stacey’s Matrix) ... 14

Figure 4. Formulating questions for an interview guide (Bryman & Bell, 2011, p.477) ... 22

Figure 5. Figures supporting the interviews (Author’s own illustration) ... 23

Figure 6. Planning qualitative content analysis (inspired by: Bryman 2011, pp.505-506) ... 24

Figure 7. Simplified ECO instruction (Author’s own illustration) ... 30

Figure 8. PEIP (Author’s own illustration) ... 32

Figure 9. PD-process (STD4303en 2013, p. 2) ... 33

Figure 10. Simple multi-project structure in Scania FPP (Author’s own illustration)... 33

Figure 11. TOGS project and the dependent product development project (Author’s own illustration) ... 34

Figure 12. Level of interdependency, respondents’ answers (Author’s own illustration)... 36

Figure 13. Change directions, figure shown during interviews (Author’s own illustration) ... 37

Figure 14. Summary of interdependency between product DP & TOGS (Author’s own illustration) ... 45

Figure 15. Combined engineering change management process (Author’s own illustration) 46 Figure 16. Iterations in TDC-process (Author’s own illustration) ... 58

Tables

Table 3. Respondents Empirical Interviews ... 23

Table 4. ECM Process; Scania standards, Scania´s reality, and ECM theory ... 49

Table 5. The seven improvements suggestions ... 54

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1. Introduction

This study instigates the theoretical fields of engineering change and project management with the aim to investigate how production development projects shall manage transmitted design changes from an interdependent product development project. The thesis is made in collaboration with Scania DT, and the TOGS (The Obvious Gearbox Supplier) subproject group DTTFA.

1.1. Problematization

In earlier years reductions of costs and natural resources have been the biggest interest in means of becoming a successful company. But with the globalization these factors have changed.

Today, the degree of innovation and the capability to launch new products fast decides if a product, or company, succeeds or not (Sorli et al. 2006). The latest years, technology innovation, environmental conditions, and changing requirements, have impacted the demands on manufacturing companies. It is told that these trends is something that the companies cannot avoid (Vogel & Lasch, 2016). Furthermore, the complexity of production systems has increased due to changes, shorter product life cycles and demand of high product variation (Windt et al., 2008).

The most quoted definition of EC is that it is it change that has to be executed when the design is released from the development project (Huang et al., 2003). Other researchers claim that EC can appear in the beginning or during the product development, and late announced change creates greater concerns as for instance when the product is released to the production because the changes can affect the whole supply chain with delays and increased costs (Alblas &

Wortmann, 2012). The reason why production lines needs to be change can for instance be because of new product requirements. The new requirement can for instance be generated from the development department changing an existing product (Kernschmidt et al., 2014). Lager (2002) would argue that the dependent project offers opportunities; when the product development changes it offers opportunities for production process development to change, and vice versa. Additionally, this interdependency can result in a domino effect of changes/a change propagation which can be seen as negative and needs to be managed (Kernschmidt et al., 2014).

If EC escalates the management becomes more difficult and creates uncertain plans for the ongoing project. The domino effect of escalated changes can occur from relatively small engineering changes and it is important to educate the employees in detecting and monitoring change correctly (Alblas & Wortmann, 2012). The most used process of managing EC is a model created by Jarratt et al. (2005), the model supports the management by dividing the tasks in to six steps, including iterations, learnings, and a risk assessments to lower the risks and change propagation. Additionally, the literature suggests different project management methodologies depending on the project´s complexity/frequency of change. Alblas and Wortmann (2012) means that all projects have a degree of complexity and different impacting

5 environments and projects with allot of changes can be seen as having a fluctuating project environment. A project with high complexity needs a flexible focused project management method - the higher complexity a project holds, the more flexible project management method is needed. If the complexity is low a more control-based/traditional project model can be used.

It is recommended to investigate the projects complexity at the beginning of the project, to choose and tailor the project management model (Eriksson et al., 2017). Moreover, if the complexity is too high in terms of certainty (know how to take action) and agreement (how to solve issues), it is suggested to use a combined project management methodology, e.g. an agile- stage-gate model (Metz 2018; Stacey 2007).

The literature presents models and theory of how a product development project can adjust to a design change and does not mention production development projects. It is also shown that different project management methodologies may support managing design change more easily. Additionally, clear statements exist how a project´s changing environment shall be managed and how interdependencies can be embraced and managed. However, although a complex production development project clearly can be affected by the design changes, theories are missing about how these projects shall manage the transmitted changes when these development project are occurring simultaneously. Therefore, the following study will focus on filling the gap of literature about how a production development project can manage transmitted design changes from the product development project.

1.2. Purpose and Research Question

The thesis purpose is to provide information of how a current production development project has managed transmitted design changes (RQ1), and propose how these transmitted design changes can be managed in a more efficient way to avoid delays (RQ2). This was made by exploring a specific production development project at Scania DT, Södertälje, which affects by transmitted design changes from an interdependent product development project. The empirical data was then analyzing and compared to an extended literature review within the fields of engineering change and project management.

RQ1:

RQ2:

How has an existing production development project managed transmitted design changes from an interdependent product development project?

How shall transmitted design change be managed in production development projects with respect to project management theory, the project character, and levels of interdependency to other development projects?

1.3. The Studied Production Development Project

A couple a years ago TOGS, the Future Powertrain Project was initiated at Scania with the goal to produce a new powertrain consisting of e.g. a new gearbox. Scania DT, the gearbox assembly, became responsible to adjust and develop the existing assembly line of gearboxes to

6 suit both the existing and the new gearbox in a project called TOGS, The Obvious Gearbox Supplier. TOGS was announced in year 2016 with the goal to commence GW gearbox production after the summer of 2019. Up until now, the product design has been developing at the same time as the adjusting of the assembly/production lines.

Due to restricted schedules, the production development project and the product design development had to occur simultaneously. To both develop a new product and the associated assembly lines simultaneously is challenging and unique at Scania which has contributed to a postponed product introduction. The product development work resulted in frequent design changes which implies change in interdependent projects. The design changes increase the multi-projects complexity and most of the delays are told to be associated to design changes of the product development project. The design changes are neither announced nor solved through a standardized way. For these reasons, TOGS project and the subproject group DTTFA will be investigated in means of answering RQ1, and be the object in the analysis discussion.

Furthermore, will recommendations be provided to suit TOGS and DTTFA.

The empirical study took the perspective of the TOGS project and from the eyes of the project team DTTFA. This implies that interdependent projects in FPP and other TOGS-subproject groups view were left out and the perspective from the discussed product DP. Additionally, the main focus has been to study the design changes caused by the product DP transmitted in to TOGS.

1.4. Dictionary

Notion Description

CE Concurrent Engineering

DC Design Change

DP Development Project

DTTFA Scania DT´s Technical department Final Assembly (TOGS subproject group) EC Engineering Change (the theoretical term of DC)

ECM Engineering Change Management

ECO Scania´s Engineering Change Order standard F-gen Function generation (stage in PD-process) FMEA Failure Mode and Effect Analysis

FPP Future Powertrain Project

GW New (currently developing) gearbox, will be produced at Scania DT GZ Existing gearbox in production at Scania DT

PEIP Scania´s Production Equipment Investment Process (standard) PD-process Scania´s Product Development Process (standard)

7 PFMEA Scania´s Process Failure Mode and Effect Analysis (standard)

PMM Project Management Methodology

Product DP Scania R&D´s product development project RFQ Request For Quotation (requirement specification) TDC Transmitted Design Change (suggested process)

TOGS The Obvious Gearbox Supplier (the studied production development project, subproject to FPP)

V-gen Verification generation (stage in the PD-process)

2. Theory

This chapter covers a deeper understanding of the theory connected to the thesis purpose and research questions. The theory has been collected to create a better understanding of the studied area and to provide relevant data for the analysis. The literature has been divided into two main sections; Change and Project: Change involves theory about engineering change (EC), Engineering Change Management (ECM), Change Propagation, and Incremental and Radical changes. It is revealed that even small engineering changes can escalates to crucial events and needs to be managed carefully. Change can be controlled by investigating risks and evaluating the best solution.

The Project section first discusses a project character by investigating complexity and turbulence. A projects turbulence and complexity is important to understand in order to organize and steer a project with correct management and methodology. Secondly, interdependency was studied to understand how a product development project affects the production development project, and how EC can propagate to other projects. Furthermore, Multi-Project Environment gain an understanding of the complexity and Concurrent Engineering, CE, was studied as a strategy to manage interdependent projects with simultaneous tasks which supports the project structure, communication, and planning. Lastly, flexible vs. traditional project management methodologies are discussed. The findings show that complex projects with high levels of change are best managed with a flexible management methodology and that projects with high interdependencies and multiple simultaneous tasks need a well-functioning communication, standardize processes, and lowered level of decision- making.

2.1. Change

2.1.1. Engineering change

Historically changes have been seen as something normal within product development projects or as changes the production department was responsible for. Engineering Change, EC, refers

8 to making adjustments to a product and engineering change management, ECM, to the organizing and control of the ECM process (Jarratt et al., 2011).

The definition of EC is wildly discussed in the theory of EC and ECM. Harmaz et al. (2012) made an extensive literature review regarding ECM and mapped the different definitions in the means of finding a common understanding. Earlier literature states that EC is modifications in the functionality, material, software or dimension and appear after the product is launched in production, or, when it released from the product development. However, some have also stated that EC can appear during the product development/product design process and life cycle (Alblas & Wortmann, 2012, Jinping et al., 2017).

The most quoted definition of Engineering change originates from Huang et al. (2003, p. 481).

“Engineering changes are the changes and/or modifications in dimensions, fits, forms, functions, materials, etc. of products or constituent components

after the product design is released.”

Moreover, the most common view is that an EC can escalate into further changes in the product development or production and are therefore a critical task for the project to solve (Harmaz et al., 2012). Because EC can affect changes across various functions in a manufacturing firm, adjustment activities needs to deal with identified EC and its impact (Huang et al., 2003). Even smaller engineering changes, that are seen less critical, can lead to great concerns if they propagate/escalate (Gil et al., 2006). Additionally, it is stated that if an EC happens during a production development project, the EC needs to be managed in a way to neither harm nor propagate into the production line. However, if a change unfortunately escalates to changes a in the production line, it has to be managed in a “correct way” (Kernschmidt et al., 2014). Some literature has seen that Engineering Changes are best managed in separate projects to easily control, plan and monitor the EC (Alblas & Wortmann, 2012). Other suggests tools and assessments in order to investigate the change effect and managed the propagation (Harmaz et al., 2012). Multiple processes exist on how to manage an engineering change. All these processes are divided into different phases or stages and include investigations of the change, approval for change and execution (Jarratt et al., 2011), one is presented further down in this section. Harmaz et al. (2012) instead sees the process of managing engineering changes in three stages and have proposed five goals of ECM;

Figure 1. Process of managing EC (Author’s own illustration)

Goals of ECM (Harmaz et al., 2012):

 Less – to achieve less ECs. Avoid the EC before it occurs and reduce the number of EC;

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 Earlier – Is about identify EC and manage EC in time, before the change propagates into further changes;

 More Effective – To decide an effective way of implementation and solution;

 More Efficient – Means to implement the required EC efficiently;

 Better – Is about learning from implemented ECs for future ECM.

Pre-change stage refers to the first goal of ECM and means to ese or prevent Engineering Change from occurring, and it is divided in to three extended categories; (1) People-oriented, to which educate the employees in how to discover and handle ECs, (2) process-oriented, which focuses of product development optimization and process modelling, and lastly (3) product- oriented covers concepts of the projects architecture, such as; design for variety, design for manufacturing, modularization, and requirement management. The second stage is In-change stage and refers to the goals Earlier, More Effective, and More Efficient. This stage involves several tools, methods, systems and strategic guidelines on how to manage the ECs. The in- change stage is further categorized into; Organizational issues, Strategic guidelines, ECM systems, Methods & IT Tools, and ECM Process (presented below) (Harmaz et al., 2012). The last stage Post-change stage covers the last goal, Better, and is about becoming better in managing ECs in the future (Harmaz et al., 2012).

The ECM process developed by Jarratt et al. (2005) is the most quoted and comprehensive model. The process is divided into three stages with a total of six process steps (Harmaz et al., 2012, Jarratt et al., 2011), see figure 2. The ECM process model looks linear to its characteristics, but possible iterations between two of the steps makes the model more flexible.

Flexibility is important to achieve in means of selecting the best solution return to steps (iterations) if needed. The first iteration can be seen from step 3 back to step 2 and the second from step 4 back to step 3. The iterations are good if a decided solution turns out to be too risky or when a further risk assessment is needed. The ECM process also includes break points, this are similar to gates in a stage-gate model, and by every break point can the EC be stopped and/or reviewed and continued (Jarratt et al., 2011).

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Figure 2. The generic engineering change process, (Jarratt et al., 2011, p. 107)

The ECM process starts with a change trigger. In the first step in the EC process is to establish a request for the engineering change. It is common to have a standardized format of how to make the request. The request has to include the reason for the change, priority of the change, type of change, what components or systems that will likely be affected. This shall be sent out to the “change-controller” who enters the information about the Engineering Change in to a change database (Jarratt et al., 2011).

The second step is to identify possible solutions to solve the engineering change. A single solution is often examined, in means of saving time or because the solution was the obvious answer for the EC (Jarratt et al., 2011). However, if is recommended to evaluate different options. This stage is often omitted which may lead to escalating changes and an uncontrolled change propagation (Kurdve et al., 2016). Both Eriksson et al., (2017), Zhang (2013), and Pollack (2007) recommends that the decision shall influence stakeholders and that complex projects should adopt a flexible project management method to enable managing changes, last stated recommendation is also agreed by several other studied authors. When a solution is selected, the risks should be assessed and investigate the impact and dependencies to the production, suppliers, and the budget. Furthermore, it is discussed that late announced or discovered EC´s creates more damage (Jarratt et al., 2011). This goes in line with the statement that EC´s creates larger concerns if they appear when the product is released to the production (Alblas & Wortmann, 2012). To evaluate the change propagation of a decision can a risk analysis (ie. FMEA – failure mode effect analysis) be used. It is necessary to use a risk assessment tool when managing radical changes and improvements, but it is not as necessary for incremental changes (Kurdve et al., 2016)

11 In the fourth step selection and approval of solution and second phase during approval, a suggestion shall be approved and a cost benefit analysis be carried out. The decision is often taken by the projects steering committee. If the board does not agree, or if the cost benefit analysis presents unpleasant numbers can the iteration path lead the process back to the third step again (Jarratt et al., 2011).

The last phase, after approval, includes step five and six. The fifth step, to implementation the engineering change can be done immediately after the approval or planned later depending on the nature of change and the product life cycle (the process of designing/developing a product).

An important aspect in this step is to ensure that all paper work (i.e. drawings, assembly schedules) are updated to the latest engineering change. Lastly, when the change has been implemented for a period of time, should it be reviewed and evaluated. It is stated that few companies fulfil the last steps (Jarratt et al., 2011).

2.1.2. Change effect

Change propagation is the domino effect, or escalation of changes, from e.g. a design change (or EC). The change propagation can be divided into two categories; ending change propagation and unending change propagation. Ending change propagation are changes that are brought to a conclusion within an expected time. It can both be a high number of changes or a quickly decreasing number of changes. Unending change propagation, is the opposite. The conclusion points are unclear and are more likely to escalate into larger and changes (Jarratt et al., 2011).

Depending on the degree of initiated change, the change can create downstream effects such as redesign and project delays (Chua & Hossain, 2012). This is the reason why small Engineering Changes can culminate into mayor changes. The changes affect various levels and lead to frequent changes between the components interfaces. The higher level of uncertainty the change propagation has, the higher uncertainty will spread to other connected projects (Alblas &

Wortmann, 2012). This means that all EC needs to be considered and managed with respect to its potential change effect (Chua & Hossain, 2012).

The reason why change propagation is usual in design projects is because of the interdependencies between multiple parts and activities associated with the products design and because of the uncertainty to develop something completely new. An EC can affect interdependent activities both internally and/or externally (Chua & Hossain, 2012). The external changes are more difficult to predict and control, and can arise at any stage during the design project. External change can for instance be new customer demands, construction methods, field conditions etc. (Chua & Hossain, 2012). A new customer requirement could for instance be improved safety, quality, performance, or/and a quicker delivery (Alblas &

Wortmann, 2012). Another author states that external change can be effects on other products within the same product family, the common manufacturing process, or business-related change with e.g. connected suppliers (Jarratt et al., 2011). Effects of internal EC are more predictable

12 and belongs to the engineering process, closed design loops, related components and sub- systems (Chua & Hossain, 2012, Jarratt et al., 2011).

The aspect of change propagation is important when managing engineering changes. Poor decisions may increase the propagation negatively (Jarratt et al., 2011). The change propagation can be inhibited by correct use of ECM process, see section 2.1.1. The second step in the ECM process, identification of possible solution/solutions to change request, need to be thought through carefully and evaluate with different solutions, both for radical changes and incremental changes (Kurdve et al., 2016). Additionally, it is proposed to even out the changes into incremental changes which is told to lead to less change propagation than radical changes.

However, at the same time it is discussed by several authors that radical change leads to higher levels of innovation. Moreover, incremental and radical change are called mental approaches of how manufacturing companies needs to execute process or product changes (Kurdve et al., 2016, p. 160):

“Change as little as possible, improve in many small steps”

“Take a large step, and include as many improvements as possible”

The first quote represents incremental change and the second is about radical change. Radical change is named to be explorative and top-down driven, incremental changes have instead predicted outcomes and are operator driven. Incremental projects can however, lead to the opposite, to radical change, if the predicted outcome becomes absent. Furthermore, incremental change can be seen as continuous improvements and can for instance be to improve the existing production line, shorten lead-times or increase productivity, in small steps. If an incremental approach is selected for a certain project, is it important to ensure that the project has sufficient time, because incremental changes takes a longer time to implement than radical changes, however it lower the risk and cost of a project (Kurdve et al., 2016).

Radical changes can be implemented to improve or adjust an existing production system, however, during a shorter period of time and increased complexity of change (Kurdve et al., 2016). Furthermore, a radical change can be for new product development or to manage radical, large impacting, engineering changes in a separate project. It is also stated that great technological changes can create EC´s and further propagations, due to the radical new technology and adjustment to it (e.g. Albas & Wortmann, 2012, Buganza et al., 2009, Metz 2018, and Stacey 2007). So, it is again recommended to evaluate the risks of making radical changes, before executing them. This could for instance be made through a standardized risk assessment sheet, e.g. FMEA - Failure Mode Effect Analysis (Kurdve et al., 2016).

Different project management methodologies are recommended for incremental focused project as well as for radical change projects. Traditional models, such as stage-gate are more

13 suited for incremental change, and flexible managerial methods for radical changes, to ese the management of change and turbulence (Buganza et al., 2009).

2.2. Project

2.2.1. Project character

Project based work has become very common in organizations today. A project can be defined as a temporary organization which executes a certain task with limited resources and within a specific time period. The character of a project varies a lot and depends for instance on the projects objectives, time period, involved tasks, assigned resources, need for support etc.

(Hallin & Gustavsson, 2012).

The tasks and objectives of projects can sometimes be uncertain, lead to complex project structures and impact the surrounding environment with turbulence. The notion of environmental turbulence is used to explain project with rapid changing demands from both customers and technology. Turbulence from customers is called market turbulence and describes by customers’ preference shifts. Technology turbulence depend instead on technology innovation which impacts the new product development. A project with a high uncertainty from both technology and customers leads to a high turbulence environment. To ease the management, it is best to see turbulence as a result of uncertainties rather than a synonym of uncertainties (Buganza et al., 2009).

Each project needs to tailor its own way of managing environmental turbulence, but some guidance is provided by Buganza et al. (2009). Marketing turbulence is seen to be best managed trough delay concept freezing, executing early experiments, and tests with customers, adapt cross-functional project teams, and create a flat organizational structure. To delay concept freezing (when the concluded design is decided) is a way to achieve project flexibility because predetermined deadlines is said to inhibit the degree of innovation and ability to manage change and technological innovation. A cross-functional project team and flat organization is recommended to guarantee knowledge exchange, better communication functions and reduce need for coordination by simultaneously achieving process rapidity.

A projects complexity increases with growing unexpected behaviors and characteristics. The degree of complexity varies in every project, but complexity exists in all types of projects.

Although the subject has been studied extensively, there is little known what determines the complexity of the project. Even the Project Management Institute (PMI) argues that complexity in projects will not go away, it will only increase (Bakhshi et al., 2016).

Complexity is a notion that can be confused with something that is complicated. Therefore, to provide a common understanding and shared language on how to manage the complexity the project´s complexity has to be understood and investigated (Maylor & Turner, 2017). Bakhasi et al. (2016) complied earlier researchers’ factors for project complexity (125 factors) and found

14 seven drivers for complexity; Context, Autonomy, Belonging, Connectivity, Diversity, Emergence and Size. Context is about the environment where the project is working in, if the objectives and project path is unclear will the project be complex. Belonging is about centralized and decentralized projects, complex projects are decentralized where people have chosen to be included and do so for the sake of its own purpose. Emergence accounts for predicted results, simple projects can foresee parts of the results, but complex projects are indeterminable and not predictable. In complex projects is it important to achieve an emergence capable to support to identify errors and results, as well eliminate bad behaviors. The last driver is size and depends on the objectives, complex projects have unlimited objectives.

Another way to categorize a project´s complexity is developed by Ralph Stacey wo designed the matrix called “The Stacey Matrix”, see figure 3. By looking at the degree of certainty (x- axis) on a project and level of agreement (y-axis) in the project, the matrix supports the decision of what project management methodology (traditional or flexible) a project should adopt.

Projects are closer to certainty when the linkage between cause and effect can be determined.

It is usual that a project is closer to certainty when events from the past occur, because the project team knows how to take action. This means that new or even unique events and issues are far away from clarity. It is bad practice to try solve the new/unique events/issues with knowledge from previous experiences, here other management is needed. The agreement axis scale is from close to agreement and far away from agreement and represents if the group, team or organization have agreed upon how to solve an issue (Stacey, 2007).

Figure 3. Stacey Matrix (Author’s own illustration of Stacey’s Matrix)

Furthermore, the arrow (going from the simple zone to the chaotic zone) represents how clarity becomes chaos by passing a complicated and a complex zone. The five circles with numbers visualize areas of decision making and management types. The first circle is Technical rational decision making, which means that past information from earlier projects can support upcoming issues and events in the current project. Projects categorized in this first area can be planned

15 with specific actions and expected outcomes (Stacey, 2007). Other sources have complimented this area to be managed with a traditional project management method, such as waterfall project management methodologies (Metz, 2018). The second zone, Complicated, has two circles.

Circle two is Political decision making, and relates to projects that are close to certainty but more distanced to agreed. Here compromises are common in order to find an agreed solution to solve the issue. As an opposite to this, the third circle is Judgmental decision making, issues that are closer to agreement and further away from certainty on how to solve them. These are solutions that the group, team or organization agree on but where the solutions cause and effect are difficult to determine. In these projects is it best to follow common visions and objectives, then preset plans (Stacey, 2007). The second circle is said to be managed traditionally (with waterfall project management), and the third circle with more flexible management such as Agile-principles (Metz, 2018). The third zone is complex, and includes the forth circle. The complexity zone is a wide area and projects in this area could achieve high creativity, innovation and breakthroughs. Therefore, managers will need the capability to adopt to different project management methodologies (both traditional and flexible) to both handle control (traditional) but also enable changes and creativity (flexible) (Stacey, 2007). Complex projects are said to be run with Agile-scrum, flexible management, project principles (Metz, 2018). The last zone, Chaotic, relates to projects with high levels of uncertainty and disagreement. Chaotic projects often result in breakdown or anarchy because the involved group, team or organization can’t be managed through ordinary planning, visioning, and negotiating. An organization should try to avoid these kinds of projects (Stacey, 2007).

2.2.2. Interdependencies

A project can exist as a single-project, or as the most usual – as a part of a multi-project environment (Aritua et al, 2008). In multi-project environments, several interdependencies exist. An interdependent project is a project which success depends on another project(s) (Aritua et al., 2009).

Araszkiewicz (2017) express the importance of managing multi-projects in today’s business environment and consider that it has a significant impact on a company’s competitive advantage. Furthermore, the main reason why multi-projects are formed is because of uncertainties and interdependencies between projects (Araszkiewic, 2017). Another reason for initiating multi-projects are said to be to achieve business objectives, while the involved projects has the purpose to enhance the main business operation or service provision. So, the purpose of managing multi-project is to create an overall organizational strategy for involved projects (Aritua et al, 2008). Despite the importance and objectives, all multi-project are classified as complex due of the issues related to project planning, coordinating and controlling several projects simultaneously (Araszkiewicz, 2017).

There exists five types interdependencies; resource interdependencies, market or benefit, interdependencies out-come dependencies, learning dependencies, and financial dependencies

16 (Killen & Kjaer, 2012). The most interesting interdependencies related to the thesis is; out- come dependency and learning dependency. Killen and Kjaer (2012) explains that an out-come dependency is when a project is dependent of the end result of another project, and learning dependencies is when a project need the capabilities and knowledge from other projects. Out- come and learning dependencies can for instance be identified between a product development project and production process development project. All types of development projects in industries imply an integration of products and production development – the product development affects the production process development and correspondingly, production development affects the product development. For instance, new developed products that differ from previous products generate a demand for new machinery and production layout (Chronéer

& Bergquist, 2012). However, confusion can appear between distinguishing product development and production development. Although, the product development offers opportunities for production process development and vice versa. Therefore, is it important to understand the differences (Lager, 2002).;

 Product development projects are stated to have an extrovert focus with the means to attract customers. This kind of development often starts with a customer dialogue and may include activates such as of material science, simulations, and design work.

(Chroneer & Bergquist, 2012). This type off development project can furthermore be driven through a desire to improve the existing product, such as product properties, quality, composition, sustainability etc. (Lager, 2002).

 Production development projects have an introvert focus to improve or adjust the industry´s production process. The objectives that initiate an execution of production development projects is cutting costs, eliminating waste, increase the process flexibility, minimize variation, improvement of production volumes, environment-friendly production, or effects from the production development project (Chroneer & Bergquist, 2012, Lager 2002).

Concurrent Engineering is a strategy to manage interdependent projects. The approved definition to Concurrent Engineering, CE, is created by the Institute for Defense Analysis, USA (Sapuan et al., 2006, p. 144):

Concurrent engineering is the systematic approach to the integrated, concurrent design of products and related processes including manufacture

and support.

It is said that CE comes from the time when industries developed and became larger. Formerly, engineering both developed the product and its related manufacturing process. But as the industries grew, work became specialized. Designers developed the products and manufacturing engineers designed the related manufacturing process. CE became the link between the specialized functions (Sapuan et al., 2006). CE creates a simultaneous work in the

17 development of a new product. It means that the manufacturing engineers can work to create the optimal manufacturing process as the same time as the product´s design is developing (Fischer et al., 2018). It is also stated to be a key to success on the market, to be able to develop the correct product and launch it in right time (Singhry et al., 2016). Automotive industries who adopt Concurrent Engineering in their development project and business prove to reduce the time-to-market, lowering costs, and improve quality (e.g. Sapuan et al., 2006; Bhuiyan et al., 2006).

Implementing concurrent projects should be executed as follow, in several steps. The first steps are to define and formalize the process and overlapping activities. This is made to evaluate and plan how and when the different activities should occur and be overlapped. When the first two stages are evaluated, it is important to standardize the process, because it is stated that by Bhuiyan et al. (2006, p. 41);

“A standardized process delivers better quality projects, which in turn means better product”

Then, a single person shall be defined as the point of contact when an issue occurs. This person is responsible for updating and ensuring that the process is executed. Without the responsible person information cannot be foreseen and communication be impaired. High level of communication is a main aspect in means of implementing a successful concurrent engineering process because communication is told to increase the understanding of working in overlapping activates and shall include of face-to-face and two-way communication, or/and shared data environments, so all involved members have access to all information shared in the project (Bhuiyan et al., 2006).

After the establishment of CE is set, people and technology have to be selected and educated/adjusted. People involved in this project are said to work in multi-functional teams to enable a broad knowledge in the project group (Bhuiyan et al., 2006).

2.2.3. The effects of Project Management Methodology

Project Management Methodologies, PMM, are defined by the Project Management Institute as set of methods, techniques, procedures, rules, templates, and best practices used in a project (Project Management Institute, 2008). Hallin and Karrbom (2012) describe that PMM should create a common language and intend to support the implementation of the project by dividing all work tasks into steps, like for instance important operations, prioritization and decisions taking. The presented views of PMM go in line with Packendorff’s (1995) suggestion about what project planning and control is. He argues that project planning and control are collected methods to find the optimal sequence of activities and effective use of resources. Additionally, is it stated that projects have to be managed depending on the specific project environment and context. All projects are unique, which indicates that projects within the same company have to be evaluated and managed differently (Buganza et al., 2009). In line with, Buganza et al.

18 (2009), Jarratt et al. (2011), and Metz (2018), Albas and Wortmann (2012) state that projects with a fluctuating environment, which implies increased turbulence, complexity, and far from certainty and agreement, have to develop a flexible project process to manage upcoming changes. Furthermore, the authors argue that projects with a fluctuating environment are not applicable to traditional linear project management approaches, due to the volatile environment.

A traditional project management methodology can for instance be a waterfall method or stage- gate. A stage-gate model is a model that supports a sequential linear process with pre-set objectives with a clear timeframe. The process consists of different stages with milestones or gates in between. Milestones are sub-objectives and gates can for instance decide if a project should continue, be reviewed or dismissed (Hallin & Karrbom, 2012). Stage-gate models are more suitable in simpler projects with smaller changes and with a stable environment (Buganza et al., 2009). The waterfall methodology is built on the principle that one step or task has to be completed before moving on to the next one. Just as the stage-gate model enables the waterfall method to evaluate if the project can move on to the next step or not (Hallin & Karrbom, 2012).

This kind of traditional management method has become more and more criticized (Conforto et al, 2014). Some researchers claim that the traditional models are no longer effective, due the new key factors of success, innovation and faster launches, and quick new product development (Cooper & Sommer, 2016). The dynamic market environment with constant launches of new innovations implies that the established manufacturing firms have to become innovation masters in the continually changing industrial environment (Brandl et al., 2018). Because the contemporary markets and organization are developing in an unpredictable way and with the combination of new developing innovations and technology, companies are facing an increased project complexity. This complexity needs a new flexible project management approach (Saynisch 2010). Further, it is also stated that established manufacturing firms have generated an increased interest in adopting flexible/agile principles to handle higher product and production complexity, customization and also mitigation of risk (Brandl et al., 2018).

Regarding the literature, it seems like contemporary industrial companies should adopt a flexible PMM approach to enable the increased fluctuating environment both internally and externally. Suggestions exist that the company has to learn when a project needs more flexibility, and when traditional linear principles can be performed (Špundak, 2014). Another possible approach to keep Packendorff’s (1995) suggestion about project planning and control, but simultaneously adopt flexibility characteristics is to adopt a hybrid approach. To combine flexible methodologies (agile) with traditional linear (stage-gate) principles can be called a hybrid, agile-stage-gate or scrum-stage-gate (Brandl et al., 2018). Several authors state that a hybrid approach would be the solution for the contemporary industrial companies to manage change (e.g. Brandl et al., 2018, Conforto et al, 2014, Cooper & Sommer, 2016, and Sommer et al 2015, etc.). A hybrid PMM is a combined management methodology that consists of agile project management (APM) and the traditional management method stage-gate (Brandl et al.,

19 2018). It is told that a hybrid would lead to a more effective management methodology that also meets the customers need. Cooper and Sommer (2016) mean that the traditional stage-gate model phases will take place at project management level and governance, and that agile method, e.g. scrum, will take place in the project execution, in the project teams. To use the hybrid PMM also provides several beneficial profits. For instance; better internal communication, better personal moral, and a more efficient planning by using flexible planning models with no pre-set deadlines. To not pre-set deadlines leads to meeting the requirements and focus on the customer.

3. Method

The method chapter begins with a summary about the thesis process. The thesis process covers the work from generated idea to solved research questions. Additionally, the method chapter presents the selection of theoretical content, empirical data, and lastly, short about the analysis, conclusions, and recommendations. Furthermore, the study´s research ideals, strategy and design, reliability, validity and generalizability will be discussed. Lastly, arguments about the thesis bias, pre-knowledge and ethics are raised.

3.1. Work process

The thesis idea comes from the authors interest of project management and project success.

After being introduced the TOGS project during a summer internship 2018, several thesis ideas were generated within the field of project management. In later discussion with Scania DTTFA´s group manager, one thesis idea was selected and the investigation started. The initial idea was to examine Scania’s project management methodologies/processes and identify improvement suggestions. However, due to the topic broadness and lack of limitations, several interviews were conducted to understand the “real problems” within TOGS project. After these interviews, a discussion was held with the thesis supervisor, and the idea was refined several times. When the idea was finally approved the study could begin. The work process is described in a linear way to simplify the process, obviously, the process was more complex and involved several iterations in-between problematizing, theoretical framework, empirical data, and the analysis.

The theoretical framework started by investigating Engineering Change, EC. EC theory built an understanding about the problem and lead to further theoretical research areas connected to EC and EC Management. It was identified that EC depends on interdependencies between different projects, is connected to a project´s complexity, and the change can be incremental or radical. Moreover, the interdependencies can be managed by concurrent engineering or controlled in a multi-project environment. Lastly, project management methodologies were investigated with the purpose to support the different suggested management methods stated in the theory of project complexity and EC. The theory was then divided into two groups; Change

20 and Project. However, the dependency between change and project management is highly important in this study. The theoretical framework was limited by the thesis limitations, found in section 1.3.

When the theoretical framework was written the empirical work began at Scania DT in Södertälje. The author focused on Scania´s subproject group DTFFA´s view of actual design changes (as the theory would have named Engineering Change, EC) between their project TOGS and the design team´s product development project at Scania R&D. Several additional interviews were held and a document analysis was conducted on Scania DT´s standards, instructions, and routines. To give the reader an understanding of Scania´s standardized project management philosophies and other work processes related to this study, the document analysis was presented before the interview data in the empirical chapter.

Later the empirical result was interpreted and analyzed in comparison to the theoretical framework. Interdependencies and propagated change was firstly analyzed, then the studied design change examples at Scania DT was mapped, followed by an analysis about project management principles in relation to complexity and change, and lastly, DTTFA´s improvement suggestions were analyzed. When the analysis was made, conclusions were drawn. The conclusion answered the thesis research questions and then formulized recommendations for Scania DTTFA (and the interdependent product DP). Lastly further studies, research credibility, and contributions were put forward.

3.2. Research ideals, strategy and design

The research ideal depends on the research aim and purpose (Bryman & Bell, 2011). The thesis has two main purposes, firstly to present how a real project production development is managing design changes transmitted from an interdependent project, and the secondly to propose a more effective way of managing transmitted changes in production development projects. This means that the study needed to understand the target group (Scania´s subproject group DTTFA) and investigate related theory to build a “theoretical framework”. Therefore, qualitative strategy was used with a combined inductive and abductive ideal. Bitektine (2008) categorized qualitative research strategy combined with an inductive approach as one of the most usual research paradigms in social science methodology. Qualitative research is explained to interprets and understands humans and the results from an inductive study, and abductive, can be simplified to be a “new theory” (Bryman & Bell 2011).

The selected method firstly supported identifying the research questions, thesis purpose, and narrow the thesis scope down. This was made by conducting interviews, inspired by the methods of semi-sutured interviews. Then, when the thesis purpose was stated, the ideals and strategy made it possible to understand the researched area at Scania DT with a second set of interviews (see more about the interview strategies in section 3.2.1). The inductive ideal enabled a freedom to analyze the respondents’ reality and Scania document in the analysis, and

21 the abduction´s flexibility to move back and forth between empirical data and the theoretical framework helped constructing the analysis, and resulted in a conclusion and recommendations to the studied project at Scania.

With support and knowledge from the theoretical framework and the empirical data collected through the interviews and collected Scania documents, the first research question has been answered:

RQ1: How has an existing production development project managed transmitted design changes from an interdependent product development project?

As a result of analyzing the empirical data trough theoretical framework the second research question was answered. However, the question is only answered within the restrictions enclosed by the study’s limitations, see section 1.3:

RQ2: How shall transmitted design change be managed in production development projects with respect to project management theory, the project character, and levels of interdependency to other development projects?

3.2.1. Interviews

The most common method for gathering data in qualitative research is to conduct interviews.

The qualitative interviews are less rigid, often flexible, and aim to investigate and understand the respondents point of view (Bryman & Bell, 2011). The methodology of semi structured interviews inspired the 13 conducted interviews at Scania that were conducted in to two rounds.

Gerring (2017) explains that qualitative interviews often research small sample groups and adds that a single person can be interviewed several times for one qualitative research, to get deeper understanding and ensure that the collected data is correct. Two respondents participated in both rounds of interviews because of their position and knowledge in the examined subproject group.

The purpose if the first round of interviews was to identify an issue which later could be examined. These interviews will be called “background interviews”. However, the background interview data shall be seen as empirical data. The second set of interviews collected the empirical data, “empirical interviews”, and were closely connected to the thesis purpose. For both rounds of interviews several interview guides were tailored to suit the respondents’

knowledge and field of responsibility. All questions were asked in an open way and formulated to avoid leading or loaded questions. Additionally, supplementary questions were asked to let the respondents embroider their answer. This was made to enable full capacity of the semi structured interview and not steer the respondents. Furthermore, all interviews were audio recorded and transcribed (ethic issues and bias are presented in section 3.6.1.).

Background Interviews, see the interview guide in appendix 1. Seven backgrounds interviews were kept with Scania employees from different departments, mostly managers from the

22 gearbox-production site, but also one employee at Scania improvement office, see table 1. The seven interviews covered a broad view of how Scania in general works within projects and how TOGS project is executed. In total 7-12 open pre-planned questions were asked, all associated to Scania´s standardized project management methodologies and TOGS. Not all respondents’

answers were suitable to include in the study, but all interviews helped create the thesis purpose.

Reference/Employment Division Date

Manager DTT 05-02-2019

ex-Manager DTT 31-01-2019

Specialist DTT 31-01-2019

Group manager DTTFA 05-02-2019

Project Manager DTTFA 31-01-2019

PPS responsible Imp. Office 30-01-2019

Head of industrial engineering DFM 05-02-2019

Table 1. Respondents Background Interviews

Bryman and Bell (2011) suggests reviewing the interview guide several times and execute a pilot interview before conducting the real interviews (a suggested process of how to formalize an information guide is seen figure 4.). Before conducting the first set of interviews, the interview guides were proofread by DTTFA´s group manager. The questions were revised and a pilot interview was conducted with the group manager in order to achieve good data quality and adequate questions.

Figure 4. Formulating questions for an interview guide (Bryman & Bell, 2011, p.477)

Empirical interviews, see interview guide in appendix 2. The empirical interviews were the core data in this study and should be seen as the fundament for the analysis and provided recommendations to Scania. The interviews were conducted when the thesis purpose was defined and the theoretical framework was written. Six carefully selected employees from the DTTFA group participated. Onwuegbuzie and Leech (2009) express that the best sample group is selected randomly. However, they continue, a qualitative sample group is usually small and could therefore consists of the “accessible population”, which is the participants that is available to the researcher. The sample group was selected by DTTFA´s group manager after a request from the author. The request searched three to five subproject managers with insight in design changes and how change affects the production development project. Four subproject managers were selected. Additionally, the group manager herself and DTTFA´s project manager also participated, see table 2.