Why Should Engineer-to-Order (ETO) Companies Care about Documentation?

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electronic documentation for effective product development

The ability to effectively manage production and customer drawings, engineering specs and quality documents is important for all manufacturers, but for companies that build engineer-to-order (ETO) products it is especially critical. Companies who create ETO products work to meet customer requirements, which can sometimes seem like a moving target throughout production. For these companies, tracking and staying up-to-date on documentation can improve the customer-client relationship, and make a direct impact on overall costs.

Manage the unique challenges of an ETO approach with effective documentation

Because ETO products are developed to meet a specific customer need, they often undergo several rounds of revisions based on customer feedback. Throughout the process, ETO companies may depend on a negotiated pre-production contract to ensure the product remains true to the customer’s order through each revision. But while the original ETO contract may define the product specs for engineers, as well as pricing, materials and overall qualities, not all revisions can be predicted in the contract before production.  And when customers demand changes outside of the scope of the contract, prices must be adjusted to reflect the new requirements.

As ETO products move through revisions, the ability to track and share the most recent documentation is a critical part of keeping the customer, manufacturer and supplier on the same page. When changes are approved and implemented, proper documentation also allows the manufacturer to quickly and easily compare the most recent product revision with the original or revised contract to ensure that the product is still meeting the customer’s expectations and address all upcharge opportunities.

Don’t get stuck eating the revision costs because of poor documentation

In contrast to companies who oversee mass production of a product, ETO companies tend to focus more on design implementation than on production planning due to their emphasis on customization. As a result, managing documentation at ETO companies is less of a priority than producing or engineering the product. This can lead to inefficiencies when the engineer is required to hand over important documents once production is complete.

A single ETO project can create hundreds of production and customer drawings, engineering specs and quality documents, due to their high margins and complexity. Engineers are responsible for tracking and implementing the changes specified in the product, and are not always concerned about how the revision may influence the original price quote. You can see where this may cause important information to fall through the cracks.

Companies get into trouble when communication between the customer, the manufacturer and the supplier breaks down. Failure to properly articulate or approve changes to the design can lead to discrepancies between the customer’s expectations and the manufacturer’s design—which usually means someone is losing money.

If an engineering change calls for a revision, it is appropriate for the customer to sign off on the change. And the manufacturer should require both the supplier and the customer to approve a change in order to ensure that all parties are on the same page and no surprises arise.  This level of back-and-forth between parties is much easier in a proper documentation management system.

The benefits of using an electronic documentation management system

Many ETO companies today use electronic documentation management tools to help simplify communication between manufacturers and the supply chain and facilitate the engineering change and request processes. There are several types of document management systems available (Arena BOMControl is one of them) and you should adopt a system that provides a comprehensive way to manage product data electronically, including part numbers, BOMs and engineering changes.

The bottom line—don’t leave good money on the table by failing to manage documentation throughout the production process. While staying current on documentation changes may not be fun, it is worth the hassle–especially for ETO companies who depend on good communication between suppliers, customers and internal teams to create a product that meets requirements in a timely fashion.   


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About the Author

Alyssa Sittig
Alyssa played an instrumental role in the development of the Arena Blog and social media channels from 2011 to 2012. Joining the team with a background in public policy, Alyssa ... Read More 

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