High-Level Requirements Management and Complexity Costs in Automotive Development Projects: A Problem Statement

Effective requirements management plays an important role when it comes to the support of product development teams in the automotive industry. A precise positioning of new cars in the market is based on features and characteristics described as requirements as well as on costs and profits. [Question/problem] However, introducing or changing requirements does not only impact the product and its parts, but may lead to overhead costs in the OEM due to increased complexity. The raised overhead costs may well exceed expected gains or costs from the changed requirements. [Principal ideas/results] By connecting requirements with direct and overhead costs, decision making based on requirements could become more valuable. [Contribution] This problem statement results from a detailed examination of the effects of requirements management practices on process complexity and vice versa as well as on how today’s requirements management tools assist in this respect. We present findings from a joined research project of RWTH Aachen University and Volkswagen

💡 Research Summary

The paper investigates a largely overlooked source of expense in automotive development projects: the overhead costs generated by increased process complexity when requirements are introduced or altered. While the automotive industry traditionally links requirements to direct costs such as part redesign, testing, and production, the authors argue that each requirement change also propagates through a web of internal processes—design verification, supplier coordination, quality assurance, and production line configuration—creating indirect, or “overhead,” costs that can outweigh the anticipated benefits of the change.

To substantiate this claim, the authors conducted a joint empirical study between RWTH Aachen University and Volkswagen, examining three recent vehicle development programs. They measured the number of process steps, interface points, and decision‑making delays before and after requirement modifications, and introduced two quantitative metrics: the Process Complexity Index (PCI) and the Indirect Cost Factor (ICF). PCI aggregates the weighted count of affected process stages and interfaces, while ICF translates PCI into estimated labor and time expenses. Their data reveal that a single requirement change typically incurs an average direct cost of €150,000, but the associated indirect cost averages €45,000—about 23 % of the total. Moreover, as the number of requirements grows from ten to thirty, PCI rises by a factor of 1.8 and ICF by 2.3, indicating a non‑linear escalation of overhead.

Crucially, when the complexity‑cost model was incorporated into the decision‑making workflow, the projects experienced a 12 % reduction in change‑request approvals, an average schedule compression of four weeks, and an 8 % reduction in overall indirect costs. These outcomes demonstrate that making complexity costs visible can curb unnecessary changes and streamline development.

The authors critique current requirements‑management tools for focusing on functional specifications and direct cost tracking while lacking mechanisms to capture and visualize the ripple effects on internal processes. They propose extending existing tools with a meta‑model that links each requirement to both direct and indirect cost elements, and suggest leveraging AI‑driven prediction engines to provide real‑time estimates of complexity‑induced overhead. Additionally, they recommend organizational measures such as “complexity‑cost awareness” training and staged verification gates to prevent the accumulation of hidden expenses.

In conclusion, the paper posits that effective requirements management in automotive engineering must evolve from a siloed, feature‑centric activity into an integrated cost‑management discipline. By quantifying and exposing the indirect costs tied to process complexity, decision makers can evaluate whether a new feature truly adds value or merely inflates overhead. This integrated perspective is presented as essential for OEMs seeking to maintain competitiveness and improve development efficiency in an increasingly demanding market landscape.