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changeBusiness is changing and becoming digital as you might have noticed. If you haven´t noticed it, you might be disconnected from the world or work in a stable silo. A little bit simplified and provocative otherwise you would not read further.

The change towards digital also has its effect on how PLM is evolving. Initially considered as an extension of PDM, managing engineering data, slowly evolving to an infrastructure to support the whole product lifecycle.

The benefits from a real PLM infrastructure are extremely high as it allows people to work smarter, identify issues earlier and change from being reactive towards proactive. In some industries, this change in working is they only way to stay in business. Others with still enough margin will not act.

Note: I am talking about a PLM infrastructure as I do not believe in a single PLM system anymore. For me PLM is supported through a collection of services across the whole product lifecycle, many potentially in one system or platform.

Changing from an engineering-centric system towards an infrastructure across the departmental silos is the biggest challenge for PLM. PLM vendors and ERP vendors with a PLM offering are trying provide this infrastructure and mainly fight against Excel. As an Excel file can easy pass the border from one department to the other. No vision needed for Excel.

A PLM infrastructure however requires a vision. A company has to look at its core business processes and decide on which information flows through the organization or even better their whole value chain.

Building this vision, understanding this vision and then being able to explain the vision is a challenge for all companies. Where sometime even management says

“Why do we need to have a vision, just fix the problem”

also people working in departments are not looking forward to change their daily routines because they need to share information. Here you here statements like

“Why people feel the need to look at the big picture. I want to have my work done.”

So if current businesses do not change, will there be a change?

Innovation

Here I see the digital world combined with search-based applications coming up. Search based applications allow companies to index their silos and external sources and get an understanding of the amount of data there exists. And from these results learn that there is a lot of duplicated data or invalid information at different places.

This awareness might create the understanding that if instead of having hundred thousands of Excels in the organization, it would be better to have the data inside a database, uniquely stored and connected to other relevant information.

I have described this process in my past three posts and agreed the context remains complex if you are not involved or interested in it.

To grasp this concept first of all, you need to have the will to understand it. There is a lot of strategic information out there from companies like Accenture, Capgemini and more.

Next if you want to understand it in a more down-to-earth manner it is important to listen and talk with your peers from other companies, other industries. This is currently happening all around the world and I invite you to participate.

Here is a list of events that I am attending or planned to attend but too far away:

October 7th Stockholm – ENOVIA user conference

imageHere I will participate as a panel member in the discussion around the concept of zero files. Here we want to explain and discuss to the audience what a data-centric approach means for an organization. Also, customers will share their experiences. This conference is focusing on the ENOVIA community – you can still register here

October 14th-15th Paris – Product Data Technology 2014 conference

pdteuropeHere I will speak about the PLM future (based on data) and what PLM should deliver for the future generations. This conference is much broader and addresses all PLM related topics in a broader perspective

October 28 Product Innovation conference in San Diego

picongressI have always enjoyed participating to this conference as like the PDT2014 it brings people together for networking and discussions. Mostly on business topics not on IT-issues.

November 26 Infuseit seminar in Copenhagen

imageRelative new in the Nordics Infuseit, a PLM consultancy company, is able to attract an audience that wants to work on understanding the PLM future. Instead of listening to presenters, here you are challenged to to discuss and contribute to build a common opinion. I will be there too.

 

Conclusion: It is time to prepare yourself for the change – it is happening and be educated an investment that will be rewarding for your company

What do you think – Is data-centric a dream ?

PLM is required to become customer focused is one of the marketing statements, in the same way as PLM and Innovation are connected. Before moving into PLM topics, I want to share some personal experiences related to customer focus. These experiences happened to me almost within a one-day timeframe.

imageTwo weeks ago I landed late in the evening at Schiphol airport. A bus took us from the plane to an arrival gate to go through security. With the other passengers, I arrived in a passage which was planned to be closed during the night as maintenance should take place. Two servicemen were frustrated by the crowd passing by.

One of them said: “How was it possible that passengers still arrive and disturb our work?” ** . The other serviceman said: “The bus driver has gone crazy to drop these passengers here where we are supposed to work?”**

** Free translated from a native Dutch local accent.

dontmissAs a customer, I realized this is a common problem of large enterprises. Most employees are not connected to their customers anymore. They focus only on their work, and every disruption (even by customers) is an element of irritation. They do not realize it is the customer at the end that pays their salary.

Next I went to the railway station to catch my train to Utrecht. Waiting on the platform, the announcement for my train to arrive did not pop up as expected on the billboard and disappeared from the list. A few minutes after the train should have departed from the station, a speaker announces the train to Utrecht has been cancelled.

imageWhy this happened nobody knows. There were no railway employees around to provide more information. (Perhaps too late – their shift was over?) Half an hour later the next train was supposed to come in. At the scheduled time, a train arrived at the platform, and everyone got into the train.

The train speaker announced that this is NOT THE TRAIN to Utrecht, and he advised all travelers for Utrecht to get out. Many passengers including me went outside looking for a railway employee who could explain what was happening. But there was no one around. At a certain moment, the right train arrived and finally after 1½ hour delay I came home and decided to file a complaint. Mainly because there was no interaction possible with any railway employee to understand why it happened, get rid of my annoyance, and what the alternatives to travel were.

Next surprise: It was not possible to file a complaint directly; you had to go through a virtual assistant named Eva. Probably they use a female name as men are usually more respectful in their conversation towards a woman than to man. Imagine it would have been Joe. Still lack of intelligence can be annoying for everyone as you can see below:

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Only when you provide Eva with your personal details and email address, you get a mail back from customer service to which you can respond with your complaint. This is somehow the same principle as a firewall with a reverse proxy. How to shield yourself from customers / virus attacks.

So I sent my mail and got a confirmation mail that I would get a response within 2 working days. And indeed within two days the answer came. They were really sorry, and they have taken so many measures already in the past to avoid this kind of situations it was almost impossible this had happened. Sorry. It was a classical answer, and what was missing any link to the actual event – nobody probably inside the railway company would take an initiative to understand what has happened. Disappointing.

dontmissAs a customer, I realized this is a common problem of large enterprises. They are not connected to their customers anymore. They are afraid of direct contact and build a solid defense wall around their organization. They do not realize it is the customer at the end that pays their salary.

The next day ….

imageI had an issue with my telephone system (Murphy´s law). The telephone company, like the railway company, was in the past a state-owned company, meaning they had a monopoly for 50 years and more. They are still struggling to become customer centric as the older staff is still in control.
If you try to interact with them through the regular means, by phone (long waiting times – many times diverted to other departments), or by email (thank you for your email – we will try to respond within two working days), you will have a similar response.

dontmissAs a customer, I realized this is a common problem of large enterprises. They are not connected to their customers anymore. People try to do their best in their domain, and if it does not fit anymore you are diverted or set aside as there is enough to keep you busy. They do not realize it is the customer at the end that pays their salary.

Enough fun now, I am sure this happens in many other places.

Back to become customer centric

imageWhen you look at a small startup company, they are focused on the outside world. To gain market share and market attention they need to focus on their potential customers and learn to engage with them as soon as possible. They have a distinctive or new proposition and the faster they understand the dynamics of their potential market, the better they have the likelihood customers will choose their offering and become successful.

And as the company is small, everyone knows who is doing what. People are multitasking and flexible. Somehow the same characteristics you find in a small mid-market company. Every customer order is celebrated there and known.

When companies become large, people start to become specialized, and they create departments. There is a need for globalization and more people will join the company around the world, combined with a layer of middle management. And more and more the management approach becomes MBR (management by results) as this has become the standard. I wrote about MBR and about MBM (management by means) in a previous post – profit beyond measure.

The disadvantage of the MBR approach is that instead of having a company looking outside to their customers, the organization turns inwards. Instead of “I need to satisfy my customers as at the end they pay my salary” the mind switches towards “I need to satisfy my boss as he/she pays my salary”

imageDepartments optimize themselves to attain efficiency and get the numbers they need to provide. For many departments, here the decision is made that customers are too disruptive or evil as they disrupt the ideal process – customer interaction becomes a threat. It is safer to do nothing and keep responding to what your boss / management wants, instead of acting in a customer centric manner as it disrupts the daily work.

Still all companies want to be customer centric as this is THE WAY to stay in business. If you know what your customers want or even better, if you can give them their unique experiences, you are ahead of the competition. And keep in mind to think glocal (global but act local – customer centric)

Glocaliszation ?

How can we bring the customer centric approach to large companies, where most departments work totally isolated from customers for various reasons? In my younger days, when I was connected with software development, I noticed most R&D organizations want to spend all day and their energy on developing new (cool) things, instead of optimizing existing (boring) stuff. Where optimizing existing stuff is what customers want, and new stuff is perhaps what marketing and sales think is needed. I think there is a lot of coolness possible in optimizing boring stuff (look at Apple).

christensenClayton Christensen wrote in his book “The Innovators Dilemma -When New Technologies Cause Great Firms to Fail” about why leading companies lose their connection with the market. They focus on their large customers and want to satisfy these large ones. The strange situation is here that they are customer centric but only for a few, where the benefit often lies in volumes of customers. Big companies focusing on key customers do not see disruption and innovations coming up, and at a certain moment they can become obsolete. Read his book if you work for a great firm. I wrote about his thoughts in the context of PLM –: The Innovators Dilemma and PLM

Finally, the extreme you find in governmental organizations. With their lack of competition and most of the time tax money coming in, there is no need to be customer centric. Even if an individual wants to be customer centric, the system will not allow this person much room to act different.

However, there is hope, and my hope is based on the Millenials or the so called “generation Y”. I described them in a recent post after reading the book Fast Future: Mixing past and future generations with a PLM sauce

If we go back to my problem with the telephone system and the large phone company, there a change is happening. A year ago I discovered they have a “social” helpdesk. If you send them a direct message through Facebook or Twitter; you receive a response within a few hours. And next they pick up the issue and take the initiative to solve it.

The same is valid for my favorite airline, KLM. As part of the big joint venture with Air France, all official contact through mail became hopeless, but their responses through Facebook are fast and to the point.

imageWhat happens behind the scenes in these two companies, and I am sure it happens in more companies, is that new employees (generation Y) become the focal point to the customer and they take away the burden of dealing with a large, rigid organization. Because they understand the company better and are considered as one-of-us inside the company, they have access to the information. They can push and pull information, initiate actions and at the end come back with a customer focused response.

This approach of personal customer interaction brings you in a better mood, although I must say in the case of the activities with the telephone company, issues were not resolved much faster. The old processes internally were still not in sync with each other. Probably because there is not “a single version of the truth”-concept like in most companies. Different systems for different purposes, not integrated cause mistakes, especially when the customer wants an immediate response and resolution.

Maybe an example to explain this approach. When working in a classical PLM system, it is all about the data inside the system with the right status and version. In modern PLM, it could be the most credible information the system could provide based on (search) algorithms. It is the similar to the way Google translate works – this was a translation a year ago:

image

In Dutch, the text is only about men, but as the combination women and kitchen was more commonly found, Google translated the sentence as above. Sexistic, based on historic associations. If you try the same sentence now, you get:

image

An accurate translation based on error fixing once. Google does not keep the one-to-one translation of words but presents the sentence with the highest probability. And when corrected it reminds the fix. This is somehow in the same manner as our brain associates information. Ultimately in a few years these engines can become as powerful as an experienced worker.

But what intrigued me more was the fact that these “social employees” somehow became the glue in the organization, connecting people and departments internally. Bringing to the customer a positive experience. Instead of specialists there was a need for generalists who can communicate.

Could this also work in the context of PLM? Instead of trying to tear down the silos, use a team of “social workers” who will interact with customers or the people in the field?

imageI am not sure. The type of customer interaction I described was mainly related to standard products and services. Not sure if this approach of generalists (data miners) would work in manufacturing companies.

When asking myself this question in the PLM domain, it realized it is somehow describing the work I am doing most of the time. Working with companies implementing PLM, working with PLM vendors and implementers on building plans to solve or resolve issues, without being part of a single project (silo) all the time – a “social worker” – a generalist is becoming an expert in generalizations.

So I am interested to learn, is anyone of the readers of this post aware of the “social approach” in their environment? Do you see companies hire generalists (generation Y) to connect the old world back to their customers?

The downside of the “social worker” is that the internal organization is even more shielded from annoying customers who disturb their plans and daily rhythm. It does not solve the silo problem.

However look at it from the modern data centric (PLM) approach, where storing information is no longer the goal. It is about identifying the right data in the context of an activity where data might come from different sources. Exactly what generation Y is used to do, the data scientist. With their mindset of connecting data instead of owning data, this generation might produce the next evolution of PLM.

Will the future be working towards access to information as likely the single truth, or will we keep on working towards a single version of the truth? If it is going to be disruptive? (Probably yes) If it is in the near future? (Why not) this is still unclear to me.

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No conclusion this time.
Many questions ……
Your thoughts / comments?

kindle_usa Recently I have been reading various interesting articles, it started with Why Amazon can’t Make a Kindle in the USA from Steve Denning and from here I followed several interesting links.

Most of the articles were business driven and not with a focus on technology. However what caught my attention was the similarity of issues that were raised in these articles as-if it was about PLM.

At the end it is a plea/cry for change to be more competitive in the future. With the current economical stand still, I believe there is a need and an opportunity for this change also in PLM. I am not pointing to regime changes all around the world, but somehow they are all connected to this new wave of globalization and openness to information.

And as my domain is PLM, I took PLM 2.0 as the vehicle to describe the change currently in the PLM world. Although PLM 2.0 is a term invented by Dassault Systems, I will use it as the placeholder to describe the changes in PLM.

In four posts I will guide you in the upcoming weeks through the thought process:calendar

This week : What is PLM 2.0 ?
Next : Challenges in current PLM
Next : Change in business
Final post : Why PLM 2.0 – conclusions

I hope you will stay with me when going through these four steps and look forward to your immediate feedback.

What is PLM 2.0 ?

In 2006 Dassault Systems announced PLM 2.0 as the new generation of PLM implemented on their V6 platform. If you go to the 3DS website you see the following definition of PLM 2.0
Look for the header PLM 2.0: PLM Online for All

In the DS definition you will find several keywords that will help us further to understand the PLM 2.0 capabilities:

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a typical Dassault Systems viewpoint, as they are coming from the world or 3D CAD and virtualization and the company’s vision is around lifelike – and life is mostly in 3D.
3D as interface towards all product related information is a paradigm shift for companies that were used to display only metadata on boring tabular screens where you navigate on numbers and text. The other major CAD-related PLM vendors of course could follow this paradigm too, as 3D visualization of information is known to them. However when coming from an ERP-based PLM system you will see 3D is something far out of reach for these vendors (at this moment).

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This is what I believe is a crucial keyword for all PLM future implementations it builds upon the Business Information concepts that became in fashion 8 years ago. Online means direct access to the actual data. No information conversion, no need for import or export, but sharing and filtering. What you are allowed to see is actual data and an actual status. Imagine what kind of impact working on-line would have on your organization. Evaluation of trends, Key Performance Indicators directly available – still of course the interpretation to be done by experts.

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Intellectual Property – a topic that should be on every company’s agenda. The reason a company currently exists and will exist in the future is based on how they manage their unique knowledge. This knowledge can be based on how certain processes are done, which components are chosen, which quality steps are critical and more. Working in a global collaboration environment challenges the company to keep their IP hidden for others, for sure when you talk about online data. Losing your IP means for a company to be vulnerable for the future – read in the referenced blog post from Steve Jennings about DELL.

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This is currently the platform for change as technologies are now enabling people and companies to implement applications in a different manner. Not only on premises, but it could be online, Software As A Service, Cloud based solutions and through standardized programming interfaces, companies could implement end-to-end business process without a huge, monolithic impact. Also Web 2.0 provides the platform for communities.

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The concept of communities opens new perspectives for collaboration. In general people in a community, have a common interest or task, and they share thoughts, deliverables back to the community across all company borders. This is the power of the community and the collective intelligence built inside such a community. Without company borders it should give the people a better perspective on their market on their business due to the global participation

The vision is there – now ….

All the above keywords are capabilities for the future and in the world of PLM you see that every PLM vendor / implementer is struggling with them. How to implement them consistently across their offering is the major challenge for the upcoming years, assuming PLM 2.0 is considered as the next step.

If you look at the PLM vendors beside Dassault Systems, you see that Siemens and PTC are closest to following the PLM 2.0 approach, without mentioning the term PLM 2.0. Other vendors even refuse to talk about PLM, but they share already similar components, for example Autodesk.

Interesting to see that the ERP-based PLM vendors do not follow this trend in their communication, they are still working on consolidating and completing their ‘classical’ PLM components

But the classical PLM vendors struggle with the change in paradigm too.

  • What to do with current, huge and structured implementations ?
  • Is PLM 2.0 having the same demands or can it be different ?

Here you see opportunities for new comers in this market as you can implement online collaboration, intellectual property creation/handling and communities in different manners with different types of implementation demands.

So far my introduction in PLM 2.0. Browsing on the web, I did not find too much other viewpoints on this specific terminology, so I am curious about your thoughts or and complementary comments on this topic.

In my next post I will zoom in into the challenges of PLM and relate them to the PLM 2.0 vision

My take on PLM (classical) and PLM 2.0

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Referenced in this context – not directly mentioned:

image This week I was happy to participate in the PLM INNOVATION 2011 conference in London. It was an energizer, which compared to some other PLM conferences, makes the difference. The key of the success, to my opinion was that there was no vendor dominance. And that participants were mainly discussing around their PLM implementation experiences not about products.

Additional as each of the sessions were approximate 30 minutes long, it forced the speakers to focus on their main highlights, instead of going into details. Between the sessions there was significant time to network or to setup prescheduled meetings with other participants. This formula made it for me an energizing event as every half hour you moved into a next experience.

In parallel, I enjoyed and experienced the power of the modern media. Lead by Oleg,  a kind of parallel conference took place on Twitter around the hash tag #plminnovation2011. There I met, and communicated with people in the conference (and outside) and felt sorry I was not equipped with all the modern media (iPhone/Pad type  equipment) to interact more intensive during these days.

Now some short comments/interpretations on the sessions I was able to attend

Peter Bilello, president of Cimdata opened the conference in the way we are used from Cimdata, explaining the areas and values of PLM, the statistics around markets, major vendors and positive trends for the near future. Interesting was the discussion around the positioning of PLM and ERP functionality and the coverage of these functionalities between PLM and ERP vendors.

Jean-Yves Mondon, EADS’ head of PLM Harmonization (Phenix program) , illustrated by extracts of an interview with their CEO Louis Gallois, how EADS relies on PLM as critical for their business and wants to set standards for PLM in order to have the most efficient interoperability of tools and processes coming from multiple vendors

image Due to my own session and some one-to-one sessions, I missed a few parallel sessions in the morning and attended  Oleg Shilovitsky’s session around the future of engineering software. Oleg discussed several trends and one of the trends I also see as imminent, it the fact that the PLM world is changing from databases towards networks. It is not about capturing all data inside one single system, but to be able to find the right information through a network of information carriers.

This suits also very well with the new generation of workers (generation-Y) who also learned to live in this type of environments and collect information through their social networks.

The panel discussion with 3 questions for panelist could have been a little better in case the panelist would have had the time to prepare some answers, although some of the improvisations were good. I guess the audience choose Graham McCall’s response on the question: “What will be the Next Biggest Disappointment” as the best. He mentioned the next ‘big world-changing’ product launch from a PLM vendor.

myplm Then I followed the afternoon session from Infor, called Intelligent PLM for Manufacturing. The problem with this session I had (and I have this often with vendor sessions) was that Venkat Rajaj did exactly wrong what most vendors do wrong. They create their own niche definition – Product Lifecycle Intelligence (is there no intelligence in PLM) , being the third software company (where are they on Cimdata’s charts)  and further a lot of details on product functions and features. Although the presentation was smooth and well presented, the content did not stick.

image A delight that day was the session from Dr. Harminder Singh, associate fellow at Warwick Business School, about managing the cultural change of PLM. Harminder does not come from the world of software or PLM and his outsider information and looks, created a particular atmosphere for those who were in the audience and consider cultural change as an important part of PLM. Here we had a session inspired by a theme not by product or concept. I was happy to have a longer discussion with Harminder that day as I also believe PLM has to do with culture change – it is not only technology and management push as we would say. Looking forward to follow up here.

The next day we started with an excellent session from Nick Sale from TaTa Technologies. Beside a Nano in the lobby of the conference he presented all the innovation and rationalization related to the Nano car and one of his messages was that we should not underestimate the power of innovation coming from India. An excellent sponsor presentation as the focus was on the content.

In the parallel track I was impressed how Philips Healthcare implemented their PLMD architecture with three layers. imageGert-Jan Laurenssen explained they have an authoring layer, where they do global collaboration within one discipline. A PDM layer where they manage the interdisciplinary collaboration, which of course in the case of Healthcare is a mix of mechanical, electrical and software. And above these two layers they connect to the layer of transactional systems, that need the product definition data. Impressive was their implementation speed for sure due to some of the guidelines Gert-Jan gave – see Oleg’s picture from his slide here.  Unfortunate I did not have the time to discuss deeper with Gert-Jan as I am curious about the culture change and the amount of resources they have in this project. Interesting observation was that the project was driven by IT-managers and Engineering managers, confirming the trend that PLM more and more becomes business focussed instead of IT-focused.

Peter Thorne from Cambashi brought in his session called Trends and Maximizing PLM investments an interesting visual historical review on engineering software investments using Google Earth as the presentation layer. Impressing to see the trends visualized this way and scary the way Europe is not really a major area of investment and growth.

Keith Connolly explained in his session how S&C Electric integrated their PLM environment with ERP. Everything sounded so easy and rational but as I know the guys from S&C for a longer time, I know it is a result of having a clear vision and working for many years towards implementing this vision.

image Leon Lauritsen from Minerva gave a presentation around Open Source PLM and he did an excellent job around explaining where Open Source PLM could/should become attractive. Unfortunate his presentation quickly went into the direction of Open Source PLM equals Aras and he continued with a demo of Aras capabilities. I would have preferred to have a longer presentations around the Open Source PLM business model instead of spending time on looking at a product.

I believe Aras has a huge potential, for sure in the mid-market and perhaps beyond, but I keep coming back on my experiences I also have with SmarTeam: An open and easy to install PLM system with a lot of features is a risk in the hand of IT-people with no focus on business. Without proper vision and guiding (coming from ????? ) it will become again an IT-project, for cheaper to the outside world (as internal investments often are not so clear), but achieving the real PLM goals depends on how you implement.

image After lunch we really reached to the speed of light with David Widgren, who gave us the insight of data management at CERN. Their problematic, somehow a single ‘product’ – the accelerators and all its equipment  plus a long lifecycle (20 years development before operational), surviving all technologies and data formats requires them to think all time on pragmatic data storage and migration. In parallel as the consumers of data are not familiar with the complexity of IT-systems they build lots of specific interfaces for specific roles to provide the relevant information in a single environment. Knowing a lot of European funds are going there, David is a good ambassador for the CERN, explaining in a comic manner he is working at the coolest place on Earth.

image Last session I could attend was Roger Tempest around Data Management. Roger is a co-founder of the PLMIG (PLM Interest group) and they strive for openness, standards and  interoperability for PLM systems. I was disappointed by this session as I was not able to connect to the content. Roger was presenting his axioms as it seemed. I had the feeling he would come down the stage with his 10 commandments. I would be interested to understand where these definitions came from. Is it a common understanding or it it just again another set of definitions coming from another direction and what is the value or message for existing customers using particular PLM software.

I missed the closing keynote session from John Unsworth from Bentley. I learned later this was also an interesting session but cannot comment it.

My conclusion:
An inspiring event, both due to its organization and agenda and thanks to the attendees who made a real PLM centric event. Cannot wait for 2012

observation Last weeks have been busy weeks and I have seen various PLM candidates all around Europe. As these companies were mid-market companies, I noticed again how difficult it is for these companies to follow the ideal path towards PLM.

For those reading my blog frequently they might remember my definition of mid-market and PLM. For newer readers I will give my definitions again, as everyone has their own definition.

Mid market company: For me the definition of a mid-market company does not have to do with revenue or the amount of people working for this company. I characterize a mid-market company as a company, where everyone has a focus on the company’s primary process. There is no strategic layer of people, who are analyzing the current business and defining new strategies for the future. In addition, the IT-staff is minimal, more seen as an overhead than as strategic. Mid-market companies have their strength in being flexible and reacting fast on changes, which might contradict with a long term strategic approach.

frog

As what happens if you are only in a reactive mode – it can be too late.

(the boiling frog)

PLM: For me PLM is not a product but a vision or business approach based on a collection of best practices (per industry). Main characteristics of PLM are centralizing all product knowledge (IP) throughout all the lifecycle stages and a focus on best practices and immediate visibility on all lifecycle stages.  Combining concept, planning, development, production planning and after sales / service into one integrated process. It is more than concurrent engineering, it is about sharing data and ownership of data through different departments. And this means business transformation, breaking through traditional barriers. Of course PLM vendors have a slight different definition in order to differentiate themselves from other vendors. For example more focus on a virtual product definition (CAD PLM vendors) or a focus on efficiency and one single platform (ERP PLM vendors)

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Who will initiate this change ?

And these two definitions already raise the questions I want to reflect here as I experienced again in two recent visits that the pain to move to PLM is here.

First what is the result of a reactive mode, even when it is a quick reaction ?

jugleA reactive mode leads to a situation where a company will never be able to differentiate rapidly from their competition. As every change takes time to implement, it is logically that a real business change will not be implemented as a quick reaction. The company needs to have a long term vision. And this is one of the things I noticed talking with mid-market companies. Ask these questions: “Where do you want to be in five years from now” and “How do you make sure you achieve these goals (if goals exist)” and often you find the company is depending on the business instinct of the founder(s) and has no real answers for the long term future.

god_comp This is of course a result of the typical mid-market company, they have no internal people who will step outside the daily hectic and work on a change. And being reactive always means you are (a little) behind. And this was the situation in one of the companies that I have met recently. There was an initial understanding of the values that PLM could bring, but when talking about some of the basic principles of PLM, the answers was: In our company ERP is God. This means real PLM has no chance – you do not want to fight against God.

 

 

And now the discussion who can initiate the change towards PLM

wise Now another example of a mid-market company that had a long term PLM vision but got trapped in their own approach. The company has been growing fast and like many European companies, production is done in China. And this causes collaboration issues around communication and quality between Europe and China as the company only knows CAD data management and ERP. The engineering manager was assigned to solve these issues.He did not get a full strategic assignment to look at the complete picture, but the management pushes him to solve the current pains, having the PLM wishes still in mind.

And solving the current pains lead again to function / feature comparison with a short term justification, believing that in the future all will fit in the PLM vision, as the potential resellers for the new solution said: “Yes we can”. Have you ever heard a reseller say “No we cannot”

The result, the engineering manager has to make a decision based on the ‘blue eyes’ of the reseller as he does not get the mandate and power from his management to analyze and decide on a PLM strategy for the long term. For one of the resellers talking about the details of PLM was even more a disadvantage as it creates an impression that PLM is complex. It is easier to sell a dream. A similar situation as I described in my posts: Who decides for PLM in a mid-market company

My conclusion

Although I am aware that many mid-market companies implement basics of PLM, it is frustrating to see that lack of priority and understanding of the management in mid-market companies blocks the growth to full benefits for PLM. The management is not to blame, as most PLM messages either come from the high-end PLM vendors or from product resellers both not packaged for the mid-market. See PLM for the mid-market – a mission impossible ?

PLM is a cross-departmental solution and the management should look for partners who can explain the business values and share best practices for mid-market companies business  wise.
The partner is 50 % of the success for a PLM implementation.

Do you recoginize similar situations ? How would you address them ?

plm_cloud

My PLM blog cloud based on Wordie – see the virtualdutchman blog cloud

observation The title of this post came in my mind when looking back on some of the activities I was involved in, in the past two weeks. I was discussing with several customers their progress or status of the current PLM integration. One of the trends was, that despite the IT department did their best to provide a good infrastructure for project or product related information, the users always found a problem ,why they could not use the system.

alm_1 I believe the biggest challenge for every organization implementing PDM and later PLM is, to get all users aligned to store their information in a central location and to share it with others. Only in this manner a company can achieve the goal of having a single version of the truth.

With single version of the truth I mean – if I look in the PLM system I find there all the needed data to explain me the exact status of a product or a project.
If it is not in the PLM system, it does not exist !

How many companies can make that statement ?

If your company does not have the single version of the truth implemented yet , you might be throwing away money and even bring your company at risk in the long term. Why ? Let’s look at some undisclosed examples I learned in the past few weeks:No_roi

  • A company ordering 16 pumps which on arrival where not the correct ones –
    1 M Euro lost
  • During installation at a drilling site the equipment did not fit and had many clashes – 20 M Dollar lost, due to rework and penalties
  • 7000 K Euro lost due to a wrong calculation based on the wrong information
  • A major bid lost due to high price estimation due to lack of communication between the estimator and the engineering department
  • 500 K Euro penalty for delivering the wrong information (and too late)

All the above examples – and I am sure it is just a tip of what is happening around the world – were related to the power & process industry, where of course high-capital projects run and the losses might look small related to the size of the projects.

But what was the source of all this: Users

locked Although the companies were using a PLM system, in one company a user decided that some of the data should not be in the system, but should be in his drawer, to assure proper usage (according to his statement, as otherwise when the data is public available, people might misuse the data) – or was it false job security as at the end you loose your job by this behavior.
People should bring value in collaboration not in sitting on the knowledge.

save Another frequently heard complaint is that users decide the PLM system is too complex for them and it takes too much time for them to enter data. And as engineers have not been bothered by any kind of strict data management, as ERP users are used to work with, their complaints are echoed to the PLM implementer. The PLM implementer can spend a lot of time to customize or adapt the system to the user’s needs.
But will it be enough ? It is always subjective and from my experience, the more you customize the higher the future risks. What about upgrades or changes in the process ?
And can we say NO to the next wish of this almighty user ?

Is the PLM system to blame ?

PxMThe PLM system is often seen as the enemy of the data creator, as it forces a user in a certain pattern.  Excel is much easier to use, some home-made macros and the user feels everything is under control (as long as he is around).

Open Source PLM somehow seems to address this challenge, as it does not create the feeling, that PLM Vendors only make their money from complex, unneeded functionality. Everything is under own control for the customer, they decide if the system is good enough.

PLM On Demand has even a harder job to convince the unwilling user, therefore they also position themselves as easy to use, friend of the user and enemy of the software developer. But at the end it is all about users committing to share and therefore adapt themselves to changes.

So without making a qualification of the different types of PLM systems, for me it is clear that:

point The first step all users in a company should realize is that, by working together towards a single version of the truth for all product or project related data, it brings huge benefits.  Remember the money lost due to errors because another version of data existed somewhere. This is where the most ROI for PLM is reported

pointNext step is to realize, it is a change process and by being open minded towards change, either motivated or pushed by the management, the change will make everyone’s work more balanced – not in the first three months but in the longer term.

Conclusion: Creating the single version of the truth for project or product data is required in any modern organization, to remain competitive and profitable. Reaching this goal might not be as easy for every person or company but the awards are high when reaching this very basic goal.

At the end it is about human contribution – not what the computer says:

observation The last month I have been working with Aerosud Aviation in South Africa to finalize and conclude on ROI and the lessons learned around their PLM implementation, which started in May 2007.  I was lucky to be involved in the initial scoping of the project in 2007 and assisted the local Value Added Reseller together with the team from  Dassault Systèmes UK team in a step by step project towards PLM.

planningWhen I met the people in Aerosud the first time in 2007, I noticed it was a young company, with open-minded people, everyone trying to improve their daily activities per department. There was the need for PLM as some of their major customers required Aerosud to have a PLM system in place. Also Configuration Management was mentioned many times in the interviews and what I learned that time: Excel was the tool for configuration management.

Based on the initial interviews a plan needed to be developed in which steps to implement PLM.  The following three major points were the guidance for the implementation:

  1. The company was thinking documents and understanding documents especially Excel
  2. The company had no clear understanding of what PLM would mean for them as real awareness was not inside the company. Customers like Boeing and Airbus talked about the importance of PLM, but how this could impact Aerosud as a company was no commonly clear
  3. People in the company had a major focus on their department and there was no availability of a overarching group of people leading the implementation

You could say you will see the above points in many smaller and medium-sized companies. I wrote about it also in one of my previous posts: Where does PLM start beyond document management ?

The project phases

riaan The good news for Aerosud was that their PLM Champion was an expert in CATIA and was familiar with writing macros in Visual Basic plus the fact that everyone in the company was open for using the system as standard as possible – no demands for special behavior of the system:  “because we do this already for 100 years”

The last phrase you hear a lot in ancient Europe

The choice was to start with implementing ENOVIA SmarTeam Design Express and to focus in two phases around design data management (phase 1) and the usage of design data by other users (phase 2)

The plan was that each phase would take maximum 2-3 months and we would give the users the time to digest and change their habits towards the standards in the system. In reality it took almost a year, not due to technical or conceptual issues, but this was the maximum pace we could have with the amount of time and available resources. The good news after these two phases was that the first bullet was much clearer understood – the difference between having a system with a single version of the truth or Excel management.

businesssystem In the summer of 2008 (our summer – as it was winter in South Africa) there was a management workshop in Aerosud and here after three days of discussion the position of PLM became clear. One year ago this would not have been possible, now people had seen ENOVIA SmarTeam and they could imagine what benefits the system could further bring. This addressed the second bullet I mentioned before. Although this workshop was not scheduled upfront, looking back now I see this was a crucial point to get understanding for the next PLM steps.

 

The next PLM steps were extending to a real Item-centric data model, because if you want to do PLM you need to work around Bill of Materials and all related information to the items in the Bill of Material. At the end this gives you configuration management without chasing Excels.

Again the next steps were divided in two phases with again a scope of 2 – 3 months. The implementation would be based on the ENOVIA SmarTeam Engineering Express methodology which came as a logic extension of the current implementation, without having to change the database or existing data model.

In the first phase we had awareness sessions for BOM (discussing EBOM / MBOM / Effectivity, etc) plus in parallel we introduced the item as place holder for the information. Not longer folders or projects as the base.

Introduction of the item was conceptual not a big issue and the major activities in this phase were focused on connection legacy data or current data from projects to the items. Data coming from various sources (directories, legacy databases) plus NC data became connected and visible in the single version of truth.

In the second phase of moving to PLM the focus was on EBOM and MBOM. Initially assuring that from the designer point of view the CATIA design and EBOM were connected as smoothly as possible, trying to avoid a lot of administrative overhead on the designer (sometimes unavoidable – see my previous post: Where is my ROI, Mr. Voskuil)

ebom_mbom

After having implemented a streamlined CATIA – EBOM connection, the focus moved to the MBOM. For me this is the differentiator for companies if they implement PLM or just Product Data Management). Implementing the MBOM requires a culture change and this is the place where the ERP people need to see the benefits instead of the threats . Luckily in Aerosud the manufacturing engineers were working in their Excels initially and not in the ERP system – which happens a lot in older companies.

For that reason the concept of MBOM in PLM was much better understood. Now Aerosud is experiencing these capabilities and once they become obvious for everyone the third bullet will be addressed: people start to work in processes cross-departmental instead of optimizing their department with a specific tool.

phased implementation As this activity will continue, I also conducted with the Aerosud management and PLM implementation team an ROI assessment. Estimates about the experienced and projected benefits were kept low and on the realistic side. The result was that the outcome for the ROI period was approx 27 months, almost the same time as the whole project had as throughput time. This proved again the statement about a phased PLM approach. payback of project comes in parallel with the implementation and will ultimately fund the next steps.

 

 

shout_left End of July I will be holding a webinar with more details about this implementation for the Dassault VAR Community. I will be happy to expand this information for a wider audience afterwards, as I believe the project is representative for many mid-market companies that struggle to find the place where PLM fits ….. and brings ROI

 

Let me know if you are interested in this follow up and I will collect the inputs for a follow up.

22112007178In the past year I shared with you my thoughts around PLM. Most of the post were based on discussions with customers, implementers, resellers and peers around the world. I learned a lot and will keep on learning I assume, as PLM has many aspects:

 

- the products, there are many products with the label PLM

- the concept, how do we interpret PLM per industry

- the customers, what do they want to achieve, without buzz-word

- the world, people and economic trends drive us sometime to irrational decisions

In this post I will give an overview from the 2008 posts, categorized by topic. I am looking forward to further suggestions in the comments if you are interested in more depth in certain areas. In parallel I will continue to share my experiences and provide an overview of best-practices and terminology experienced in the PLM space.

PLM concepts

Managing the MBOM is crucial for PLM

Is there a need for classification – and how should it be done ?

Is the PLM concept applicable for mid-market companies too ?

What will happen with PLM – looking towards 2050

 

PLM and ERP

PLM and ERP – the culture change, continued

Connecting PLM and ERP – part 1, part 2, part 3

 

PLM and ROI

Implementing PLM is too costly ?

Implementing PLM takes too long ?

Why implement PLM next to an ERP system ?

How is PLM different from CAD data management ?

Too busy to implement PLM ?

Economical crisis creates the opportunity for change

 

Business Process Change

PLM in SMB requires a change in thinking

The management is responsible to initiate a change towards PLM

The change in automotive/aero supply chains to more advanced partners

How will mid-market companies pick-up the benefits from implementing PLM ?

 

Experiences

European Enovia Customer Conference (ECC)

PLM in Greece – does it exist ?

Is the concept for PLM mature enough ?

Don’t expect a bottom up PLM implementation to become successful

 

Conclusion

I would like to conclude with a quote from my favorite scientist, who taught us everything is relative, however:

“We can’t solve problems by using the same kind of thinking we used when we created them.”

Looking forward to your feedback, wishes in 2009 !

8years

Jos Voskuil

This week, I was in Bruxelles conducting a Engineering Express training for ENOVIA SmarTeam resellers. The feedback I got from the participants during the training made me again more aware from the culture change needed or dreamed about in the small and medium manufacturing enterprises.

As I wrote before in PLM and ERP – the culture change , there is for sure a conservative vision in the small and medium enterprises to stay with their major IT systems they invested in, usually ERP and (3D) CAD.

From the bigger enterprises and reading all the analyst reports, many of us project that the small and medium enterprises also need PLM in the same way as the bigger enterprises, but then in a more packaged, ready to use manner, instead of a custom implementation guided by PLM experts like the bigger enterprises did.

So ENOVIA SmarTeam Engineering Express is a prepackaged solution bringing PLM closer to the mid market. However during the training many of the questions were not around the capabilities of the Engineering Express, but more about why do we(customers) need to use the same approach as bigger enterprises, why do we have the same needs?

Where big companies focus on defining and implementing processes in order to have a predictable outcome, I noticed in talking with SMB companies, they are proud of explaining they exist without these processes enforced, but work in a more flexible, human task oriented manner.

If we look to a classical ECR/ECO process, we see in bigger companies there are several steps to be identified to react on a outside request (the ECR) and to implement it (ECO).

image

An Engineering Change Request (ECR) process

image

An Engineering Change Order (ECO) process

In smaller companies the ECR process is already embedded in one singe ECO process. Sometimes a formal (email) based activity takes place before a change is requested and implemented. One of the participants in the course – a manufacturing company – mentioned that they had the notice of a CCB in their company but all engineering change requests were sent to the CCB by email and as the CCB was meeting on a weekly base, this was the process to filter engineering change requests.

image

So here is the question: Big enterprises need processes to remain manageable – like a big tanker needs a predefined methodology to navigate through a harbor. Small and medium enterprises are more relying on their flexibility and they need a reliable and sustainable way to react – like a small ship in a harbor – as it can react quickly there is no need for the anticipation, still the capability to change direction is needed.

So are small and medium enterprises that behave like small ships in the harbor ?

If yes, they need to remain open for change as going straight ahead at the end will lead to a collision – and the challenge remains to make the (culture) change.

Or if no, how can you provide small and medium enterprises with means that enforce change without creating the overhead that compromises the flexibility ?

image

I am looking forward to comments and thought on this question – please post them.

 

However my first priority tonight is to survive in Milan where the match Italy-France will decide who continues to the next round in the European Soccer Championship. Worst case in parallel the Netherlands looses from Romania, in that case both Italy and France are gone and this might be my last post:)

 

Hoping to write my next post at the end of this week.  ciao – adieu

The connection between PLM systems and ERP systems has kept many companies busy for many years. As both systems manage items in their system, all kind of battles are fought on ownership, redundancy of data and more. Last week I was involved in four different cases, which demonstrates this topic is very actual, and as most of the companies involved were in the mid-market, it shows also these companies are no in the phase of implementing and extending PLM within the organization.

In the first case, which I will comment here, it was a big enterprise using ENOVIA SmarTeam and SAP. As SAP has their own PLM module, the initial push was of course to use SAP all over, however the company considered the SAP PLM module not powerful and flexible enough for their engineering environment. For that reason the battle around the items and mainly the BOM for Manufacturing started.

The manufacturing BOM is usually the start point for production and the source for the ERP system to start production (and planning). For that reason, ERP systems claim ownership for this BOM, although the definition of the BOM is all based on engineering information within the PLM system.  As ERP systems are already established for many years, companies are familiar with defining the manufacturing BOM in their system, often a labor-intensive job as data needs to be collected from the engineering department, often in the form of spreadsheets.

PLM systems are designed to manage the manufacturing BOM , connecting all information within the system. This requires however, a change in the way people and a company is working. Engineers have more responsibility to enter complete data – there is no one to review and complete the data afterwards and combined with the lack of flexibility that people had before with Excel this lead to a cultural refusal from the floor.

If the management realizes that managing the manufacturing BOM in the PLM system will lead to less errors, a shorter time to production and less labor cost, they will push this approach top-down. This happened in many big PLM centric enterprises.  In smaller companies, this value is not visible for the management as often users, the IT department or the ERP team will pinpoint that the PLM system does not suit their needs, as it requires a change in working (their best practices).

Culture change will only come in the mid-market when PLM concepts become a commodity for companies too. The change will come, driven by ENOVIA SmarTeam with their mid market solutions. But we all know changes take time – as you can see in the following movie

I will talk in my next posts in more details on PLM-ERP issues. FYI the customer mentioned in the beginning decided to keep the manufacturing BOM definition in SAP as this is what they understood and people decided not to take the risk with PLM.  

Culture change takes time ….

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