Does history repeat itself even in the PLM domain? The last week I have read various blog posts related to PLM and Small and Medium Enterprises (SME). A good summary of these thoughts can be found in  Oleg Shilovitsky’s post: How PLM vendors can find a formula to serve midsize manufacturing companies. Usually, the conclusions are:

  • Smaller enterprise cannot afford the “expensive” PLM solutions
  • Existing PLM systems are too complex to implement
  • Lack of usability
  • PLM systems are not flexible enough to implement
  • PLM should be cloud-based (reducing IT costs and efforts).

Jim Brown from Tech-Clarity published an e-book Finding PLM to Fit Mid-Sized High-Tech Companies and Oleg chimed in on that post as Jim talks about Core PLM, which was more design-oriented than BOM-oriented. Read these two posts as they give a good insight into PLM vendor thinking.

In 2006, Oleg and I worked @ SmarTeam where we defined and built a “Core PLM” solution, targeting mid-market companies. This core PLM solution called the SmarTeam Engineering Express (SNE) contained both pre-configured CAD-integrations as well as BOM practices (EBOM-MBOM).  Combined with documented best practices, pre-configured methodology, and workflows this environment could be implemented relatively quick (if the implementer did not want to earn extra money on services ).

There was even ROI provided by a launching customer:  A PLM success story with ROI (2012)

As part of the SME focus, SmarTeam people interviewed small and medium enterprises to understand in detail their needs. They mentioned the obvious points:

  • Easy to Use (Usability)
  • Quickly Deployable (Best Practices – pre-defined processes)
  • Easy & rapid Configurable and low IT-costs.

Interesting enough SmarTeam’s enterprise customers requested the same capabilities. It makes you realize there is no unique difference in PLM for mid-market companies and large enterprises. I believe the major difference is due to education, the company’s culture and where the PLM decision is made. Let’s explore

Lack of education

Small and Medium Enterprises usually lack resources who can spend time on planning or think about a new business strategy. The work needs to be done first. SME companies hire experts for their skills that bring immediate value, strategic thinking comes second. An engineering department does not hire a strategist; they hire a qualified and promising engineer.

These new hires are normally not educated on standard PLM concepts like ECR, ECO, Configuration Management, PLM-ERP best practices (EBOM/MBOM). For an engineering study, these practices/processes are not considered as critical as it is about collaboration and not about skills. The PLM capabilities engineering students learn are the basic functionalities they need master when working with their (CAD) tools.

SME’s use their own best practices based on years of experience (before PLM existed) and when they select a PLM system, it is mostly more a data management tool than an infrastructure to streamline processes. Combined with the fact that every PLM vendor has its own definition for PLM, it is hard to have a unified way of thinking for bring in new ways of working supported by a best in class PLM-system. The lack of standards and education is illustrated by a recent post from John Stark: Should PLM become a profession?

Of course, you can educate yourself on PLM. CIMdata is well-known for its training program, John Stark and others can educate you on PLM. Have a look at this interesting new startup SharePLM. PLM is about sharing, and I try to share PLM experiences too, by coaching or lecturing or through my blog posts. My most read posts over the past years are ECO/ECR for Dummies, The importance of a PLM data model: EBOM – MBOM and Bill of Materials for Dummies – ETO. Illustrating people around the world want to be educated on PLM but can the influence their (non-educated) management?

SME management considers PLM as an engineering tool. They want their employees to work with the best tools, and the management’s focus is on reducing costs and improving efficiency. Different ways of working or different business models, enabled by digitalization are not necessary on the SME management agenda. However, with the digital revolution is on its way, strategical thinking becomes crucial for survival. In that context, a recent post from Beth Stackpole on Digital Engineering says it all: PLM Knowledge Gap Hampers New Engineers.

Difference in culture

Small and Medium Enterprise often rely on close collaboration between people all working with their best in class tools per discipline. Collaboration is done through email, personal relations, and Dropbox-like sharing tools. They know their peers and people rely on intrinsic knowledge.

 

Large enterprise often consists of a collection of business units that could be considered as Small and Medium Enterprises. To create synergies and gain IT-benefits, management from large enterprises want to standardize on processes (naming and steps) and tools. Standardized processes allow the management to compare and benchmark the Business Units. Standardized tools, of course, reduce the overall IT costs.

Large enterprises usually have staff with a strategic task to work on standardized and optimized processes for the future. These people will discover and have time to be educated on the values of PLM, supported by strategic advisors that know the value of PLM. In these companies, the decisions made for PLM are top-down decisions. Usability, functions/features and costs are usually crucial for bottom-up decisions. For a top-down decision an aligned vision, matching roadmap, management value and costs are usually the main topics.

Conclusion

Ten years ago I believed Small and Medium Enterprises would benefit from a special offering with a focus on usability, pre-configured environments and providing best practices. I believe this is now on the agenda for all PLM vendors, some perhaps struggling with their legacy. However, cloud offerings will become more and more similar. Therefore, PLM education is in my opinion still a missing point in SME. Educated management and educated students could increase the value delivery of PLM by understanding the right target and managing the expectations correctly.

What do you think? Will there ever be the best-in-class PLM offering for SME or do you believe the human factor where education and understanding are crucial?  Looking forward to your opinion !