Cost impact analysis of requirement changes in the automotive industry: A case study

Abstract

Many complex products are now developed collaboratively across enterprises in a geographically extended and time-extended process. High-frequency changes to the initial design requirements are typically requested; this is due to service needs, legislative directives, and market feedback. Responding to these requirement changes requires a cost impact analysis.

This paper presents a methodology to determine costs rapidly and accurately when requirement changes are proposed during the design development phase of the life cycle development of a complex product. The methodology combines a system representation technique with rule-based cost estimation to determine the incurred cost of requirement changes. The approach is suited to managing requirement changes when the product definition is performed across an extended enterprise. The authors describe the results of research conducted in a collaborative development environment between an automotive original equipment manufacturer and a tier 1 supplier. A case study illustrates the application and the capability of the approach. The methodology aids the original equipment manufacturer and the tier 1 suppliers in their decision making throughout the product development phase. The research identifies relationships between requirements, design solutions, and cost drivers. The resultant methodology has widespread application in the context of complex product.

Keywords

requirement change impact analysis cost estimation functional requirement design parameter

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