If you manufacture a complex product (meaning that it contains lots of components or has a deep bill of materials with lots of subassemblies), then it would probably behoove you to have a strong approach to engineering change management (ECM).

ECM allows you to have good control over how engineering changes are transferred from engineering to production.  It requires that you have to maintain two bills of materials:  An engineering bill of materials (EBOM) and a manufacturing bill of materials (MBOM).

You may ask why do I need to maintain two bills of materials?  Let me assure you that there are good reasons why you need two separate BOMs.  The core of it lies in that you may engineer a product in one way and then manufacture it a little bit differently than was contemplated.  These deviations arise not because the engineers necessarily have done anything wrong.  It's just the nature of the business.

If you're managing a bill of materials only in your ERP while at the same time having a significant engineering design effort, then you probably have a problem.

There are lots of ways to approach engineering change management.  There’s a full spectrum.  At one end of the spectrum, you could take a very simple, informal approach like sending emails or catching Bobby in the hallway and saying “hey, can you please buy this part?”.

At the other end of the spectrum, you could have a more formal, rigorous approach to engineering change management like having a PLM or a PDM system with a formal engineering change orders (ECOs) that are tied to ERP.

If you’re in a smaller company with a smaller engineering organization, then you probably want to practice something that's intermediate on this spectrum.

A lot of people use spreadsheets to track engineering changes but I can tell you that those spreadsheets are usually composed in a way that doesn't really lend itself to effectively transferring information from engineering to manufacturing.

If you find yourself in this situation, then you have got to know the difference between an EBOM and an MBOM and how to manage the information flow between the two using engineering change management.