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In my previous post, I shared my thoughts Why PLM is the forgotten domain in digital transformation. Legacy data, (legacy) people and slow organizations are the main inhibitors to moving forward. Moreover, all this legacy makes it hard to jump on the digital wagon.
When you talk with vendors and implementers of PLM solutions, they will all focus on the fact that with their solution and support PLM is simple. It is simple because:
- We have the largest market share in your industry segment
- We have the superior technology
- We are cloud-based
- We are insane customizable
- Gartner is talking about us
- We have implemented at 100+ similar companies
For my customers, implementing PLM was never simple as every PLM implementation was driving a business change. In the early days of SmarTeam, we had the theme “We work the way you work”, which is in hindsight a very bad statement. You do not want to automate the way a company is currently working. You want to use a PLM implementation to support a business change.
Never implement the past, implement the future
And there are changes ……
When I was discussing PLM with my potential customers ten years ago, the world was different. PLM was in a transition from being a PDM-tool from engineering into an extended PDM-tool centered around product development. A major theme for this kind of implementations was to move from a document-driven environment towards an item-centric environment. Instead of managing documents (CAD files and other files like Excel) the implementation was based on providing a data continuity, where the item (the physical part or in SAP terms the material) would be the main information placeholder. The continuity is implemented around EBOMs and MBOMs and thanks to automation the MBOM can be connected to the ERP system in a continuous flow.
Just search for item-centric or BOM-centric, and you will find many references from vendors and consultants for this approach. Implementing PLM item-centric is already a big step forward in efficiency and quality for companies. However,…
Never implement the past, implement the future
And there will be changes …..
Digital transformation is changing the way we do business and is changing the way companies should organize their data. A BOM-centric approach is no longer the ultimate implementation concept. To support a digital enterprise, the next step is a model-based enterprise. The model (not necessary the 3D-model) and its maturity and configurations are intended to be the reference for an organization. The model and its representation can connect hardware and software in a data-driven environment through the whole lifecycle. A model is needed to support smart manufacturing and the digital twin concept.There are many impressive marketing movies on YouTube explaining how companies/vendors implement digital continuity. Unfortunate the gap between marketing and reality is big at this time because moving to a model based enterprise is not an easy step. Coming back to the LEGACY-statement at the beginning of this post, it is not simple.
We all have to learn
Digital transformation is just starting in the domain of PLM. Sharing and collecting knowledge is crucial, independent from particular solutions. For me, the upcoming PDT-conference in October is going to be a reference point where we are on this journey. In case your company has the experience to share related to this topic, please react to this link: http://pdteurope.com/call-for-abstract-now-open/
In case you want to learn and believe it is not simple, wait till the program it will be announced. The PDT conference has always been a conference where details are discussed. Looking forward and discuss with you.
Implementing and continuing with PLM is not simple for a company due to changes in paradigms. Digital transformation forces companies to investigate the details how to make it happen. Implementing PLM in scope of a digital transformation requires learning and time, not products first.
A month ago I attended PI Berlin 2017 and discussed how digital transformation should affect PLM. You can find the presentation here on Slideshare. One of the conclusions of my presentation was that PLM is the forgotten domain in digital transformation, which lead to the tweet below from Nick Leeder from SKF.
I am from the generation who believes answering complex issues through tweets is not a best practice. Therefore, I dedicate this post to answer Nick’s question.
A digital enterprise is the next ultimate dream after the paperless office. Where the paperless office was focusing on transforming paper-based information into electronic information, there was not a mind-shift in the way people could work. Of course, when information became available in an electronic format, you could easily centralize it and store in places accessible to many others. Centralizing and controlling electronic information is what we did in the previous century with document management, PDM, and classical PLM. An example: your airline ticket now provided as a PDF-file – electronic, not digital.
This process is not a digital transformation
Digital Transformation means that information is broken down into granular information objects that can be stored in a database in the context of other information objects. As they have a status and/or relation to other information objects, in a certain combination they bring, in real-time, relevant information to a user. The big difference with electronic information is that the content does not need a person to format, translate or pre-process the data. An example: your boarding app, showing the flight, the departure time, the gate all in real-time. If there is a change, you are immediately updated.
Digital Transformation for an enterprise
In a digital enterprise, information needs to be available as granular information objects related to each other providing the end-to-end continuity of data. End-to-end continuity does not mean that all data is stored in a single environment. The solution can be based on digital platforms working together potentially enriched by “micro-services” to cover specific gaps the digital platforms do not deliver.
ERP systems by nature have been designed to be digital. Logistical information, financial information, part information for scheduling, etc., all is managed in database tables, to allow algorithms and calculations to take place in real-time. Documents are generated to store snapshots of information (a schedule / a report), or there are pointers to documents that should contain digital, unmanaged information, like contracts, drawings, models. Therefore, the digital transformation does not impact ERP so much.
Customer connected platforms are a typical new domain for manufacturers, as this is where the digital transformation takes place in business. Connecting either to your products in the field or connecting to your consumers in the market have been the typical business changes almost every manufacturer is implementing, thanks to IoT and thanks to global connectivity. As this part of the business is new for a company, there is no legacy to deal with and therefore exciting to present to the outside world and the management.
The problem of legacy
And here comes the problem why companies try to neglect their PLM environments. There is so much legacy data, stored in documents (electronic formats) that cannot be used in a digital PLM environment. Old PLM quality processes were about validating documents, the container of information, not about the individual information objects inside the document. And when information changes, there is no guarantee the document is going to be updated, due to economic reasons (time & resources)
To give an example. A year ago I wrote a post: The Impact of Non-Intelligent Part Numbers where I explained in a digitally connected enterprise part numbers no longer need to have a meaning. As long as they are unique throughout the enterprise, automation will take care PLM, and ERP are connected. In one of the comments to this post, a reader mentioned that they were implementing now non-intelligent numbers in their company and the ERP consultant recommended to renumber all the old part numbers to have a clean start. From the ERP point of view, no issue. The consultant probably never had learned about the fact that part numbers are used in drawings, instructions, spare part manuals, which are all documents in the engineering domain. Renumbering them would be a waste of resources and money, just to have a “pure” part number. In the world of PLM, you have to deal with legacy.
The need for business transformation
Companies currently do not fully recognize that the old way of working in PLM, based on a document-driven approach, is not compatible with a modern data-driven approach. The old approach makes documents the formal decision carrier for product information. Documents are reviewed and approved and once approved stored. When information is changing, documents are most of the time not updated due to the cost of maintaining all these versions of documents in the context of the related products. Documents lock information and do not guarantee the information inside the document remains actual.
In a data-driven environment, we work in a much more granular manner, directly with the data. Working data-driven reduces the need for people in the organization to collect and transform information into documents for further communication.
As both approached do not match in a single business process or a single PLM system, the challenge for companies is to decide how to keep the old environment available and meanwhile introducing the new data-driven approach for PLM. Customizing this upon your old PLM environment would be a problem for the future as customizations are hard to maintain, in particular, if these are the customizations that need to support the future.
Building everything in a new environment, designed for a data-driven approach, will also be a guarantee for failure. The old data, stored in documents, does not have the granular quality a data-driven environment needs.
Combined with the fact that different people will be needed to support old or new businesses, the topic of solving PLM for the future is not an easy one.
And when things are not easy, it is hard to find the right support for changes. Management usually does not spend enough time to understand the big picture; politics come into play.
Unfortunately, it’s usually safer and better for one’s career to cut costs a little further than to try to hit the rare innovation homerun
Quote from Political Realities of PLM-Implementation Projects in Engineering.com
Why PLM is the forgotten domain in digital transformation is quite understandable, although it requires more than a tweet to picture the full story. Understanding the reasons is the first step, making PLM part of the digital transformation is the main challenge – who has the energy and power to lead?
Last week I shared my observation from day 1 of the PI Berlin 2017 conference. If you have not read this review look here: The weekend after PI Berlin 2017.
Day 1 was the most significant day for me. I used the second day more for networking and some selective sessions that I wanted to attend. The advantage for the reader, this post is not as long as the previous one. Some final observations from day 2
PLM: The Foundation for Enterprise Digitalization
Peter Bilello from CIMdata gave an educational speech about digitalization and the impact of digitalization on current businesses. Peter considers digitalization as a logic next step in the PLM evolution process. See picture below.
Although it is an evolution process, the implementation of this next step requires a revolution. Digitalization will create a disruption in companies as the digital approach will reshape business models, internal business processes, roles and responsibilities. Peter further elaborated on the product innovation platform and its required characteristics. Similar to what I presented on the first day Peter concluded that we are in a learning stage how to build new methodology/infrastructure for PLM. For example, a concept of creating and maintaining a digital twin needs a solid foundation.
His conclusion: Digitalization requires PLM:
Boosting the value of PLM through
Advanced Analytics Assessment
Paul Haesman from Autoliv introduced the challenges they have as a typical automotive company. Digitalization is reshaping the competitive landscape and the demands on more technology, still guaranteeing the highest safety levels of their products. In that context, they invited Tata Technologies to analyze their current PLM implementation and from there to provide feedback about their as-is readiness for the future.
Chris Hind from Tata Technologies presented their methodology where they provide benchmark information, a health check, impact and potential roadmap for PLM. A method that is providing great insights for both parties and I encourage companies that haven´t done such an assessment to investigate in such an activity. The major value of a PLM assessment is that it provides an agreed baseline for the company that allows management to connect the Why to the What and How. Often PLM implementations focus on What and How with not a real alignment to the Why, which results in unrealistic expectations or budgets due to the perceived value.
An interesting point address by Chris (see picture above) is that Document Management is considered as a trending priority !!!
It illustrates that digitalization in PLM has not taken off yet and companies still focusing on previous century capabilities 😦
The second highlight rating Manufacturing Process Management as the most immature PLM pillar can be considered in the same context. PLM systems are still considered engineering systems and manufacturing process management is in the gray area between PLM systems and ERP systems.
The last two bullets are clear. The roots of PLM are in managing quality and compliance and improving time to market.
Overcoming integration challenges –
Outotec´s Digital Journey
Helena Gutiérrez and Sami Grönstand explained in an entertaining manner the Outotec (providing technologies and services for the metal and mineral processing industries) company and their digital journey. Outotec has been working already for several years on simplifying their IT-landscape meanwhile trying to standardize in a modern, data-driven manner the flow of information.
Sami provided with great detail how the plant process definition is managed in PLM. The process definition is driven by the customer´s needs and largely defines the costs of a plant to build. Crucial for the quotation phase but also important if you want to create a digital continuity. Next, the process definition is further detailed with detailed steps, defining the key parameters characteristics of the main equipment.
And then the challenge starts. In the context of the plant structure, the right equipment needs to be selected. Here it is where plant meets product or as the Outotec team said where the elephant and ants do the tango.
In the end, as much as possible standardized products need to match the customer specific solution. The dream of most of these companies: combining Engineering To Order and Configure To Order and remember this in the context of digital continuity.
So far, a typical EPC (Engineering Procurement Construction) project, however, Outotec wants to extend the digital continuity to support also their customer´s installed plant. I remembered one of their quotes for the past: “Buy one (plant) and get two (a real one and a virtual one). “This concept managed in a digital continuity is something that will come up in many other industries – the digital twin.
Where companies like Outotec are learning to connect all data from the initiation of their customer specific solution through delivery and services, other product manufacturing companies are researching the same digital continuity for their product offerings to the field of consumers. Thanks to digitization these concepts become more and more similar. I wrote about this topic recently in my post PLM for Owner/Operators.
Final conclusion from PI Berlin 2017
It is evident participants and speakers are talking about the strategic value and role PLM can have an organization.
With digitalization, new possibilities arise where the need and value for end-to-end connectivity pop up in every industry.
We, the PLM community, are all learning and building new concepts. Keep sharing and meeting each other in blogs, forums, and conferences.
It is already the 6th consecutive year that MarketKey organized the Product Innovation conference with its primary roots in PLM. For me, the PI conferences have always been a checkpoint for changes and progress in the field.
This year about 100 companies participated in the event with the theme: Digital Transformation. From Hype to Value? Sessions were split into three major streams: digital transformation, extended PLM, and Business Enabled Innovation larded with general keynote speeches. I wanted to attend all sessions (and I will do virtually later through PI.TV), but in this post, my observations are from the event highlights from the extended PLM sessions.
From iCub to R1
Giorgio Metta gave an overview of the RobotCub project, where teams are working on developing a robot that can support human beings in our day-to-day live. Some of us are used to industrial robots and understand their constraints. A robot to interact with human beings is extreme more complex, and its development is still in the early stages. This type of robot needs to learn and interpret its environment while remaining accurate and safe for the persons interacting with the robot.
One of the interesting intermediate outcome from the project is that a human-like robot with legs and arms is far too expensive and complicated to handle. Excellent for science fiction movies, but in reality too difficult to control its balance and movements.
This was an issue with the iCUB robot. Now Giorgio and the teams are working on the new R1 robot, maybe not “as-human” as the iCUB robot, but more affordable. It is not only the mechanics that challenge the researchers. Also, the software supporting the artificial intelligence required for a self-learning and performing safe robot is still in the early days.
An inspiring keynote speech to start the conference.
Standardizing PLM Components
The first Extended PLM session was Guido Klette (Rheinmetall), describing the challenges the Rheinmetall group has related to develop and support PLM needs. The group has several PLD/PLM-like systems in place. Guido does not believe in one size fits all to help every business in the group. They have already several PLM “monsters” in their organization. For more adequate support, Rheinmetall has defined a framework with PLM components and dependencies to a more granular choice of functionality to meet individual businesses.
A challenge for this approach, identified by a question from the audience, is that it is a very scientific approach not addressing the difference in culture between countries. Guido agreed and mentioned that despite culture, companies joining the Rheinmetall group most of the time were happy to adhere to such a structured approach.
My takeaway: the component approach fits very well with the modern thinking that PLM should not be supported by a single “monster” system but can be addressed by components providing at the end the right business process support.
PLM as a business asset
Björn Axling gave an excellent presentation describing the PLM perspective from the Husqvarna group. He addressed the external and internal challenges and opportunities for the group in a structured and logical approach which probably apply for most manufacturing companies in a global market. Björn explained that in the Husqvarna group PLM is considered as a business approach, more than ever, Product Lifecycle Management needs to be viewed as the DNA of a company which was the title of one of his slides.
I like his eleven key imperatives (see the above picture) in particular key imperative #9 which is often forgotten:
Take definitions, nomenclature and data management very seriously – the devil is in the details.
This point will always fire back on you if you did not give it the needed attention from the start. Of course, the other ten points are also relevant. The challenge in every PLM project is to get these points addressed and understood in your company.
How to use PLM to enable Industry 4.0?
The title of the presentation was related to Industry 4.0 more focusing on innovation in for Germany´s manufacturing industry. Germany has always been strong in manufacturing, not so strong in product innovation. Martin mentioned that later this year the German government will start another initiative, Engineering 4.0, which should be exciting for our PLM community.
Martin elaborated on the fact that end-to-end support for SysLM can be achieved through a backbone based on linked data. Do not try to solve all product information views in a single system is the lesson learned and preached.
For me, it was interesting to see that also Martin picked up on the bimodal approach for PLM, required to support a transition to a modern digital enterprise (see picture). We cannot continue to build upon our old PLM environments to support, future digital businesses.
PLM and Digital Transformation
In my afternoon session (Jos Voskuil), I shared the observations that companies invest a lot in digital transformation downstream by introducing digital platforms for ERP, CRM, MES and Operations. PLM is often the forgotten platform that needs to change to support a digital enterprise with all its benefits. You can see my presentation here on SlideShare. I addressed here the bimodal approach as discussed in a previous blog post, introduced in Best Practices or Next Practices.
In case your company is not ready yet for a digital transformation or bimodal approach I addressed the need to become model-driven instead of document-driven. And of course for a digital enterprise, the quality of the data counts. I wrote about these topics recently: Digital PLM requires a Model-Based Enterprise and The importance of accurate data: ACT NOW!
The last extended PLM presentation from day 1 was given by Felix Nyffenegger, professor for PLM/CAx at HSR (University of Applied Science in Rapperswil (CH)). Felix shared his discovery journey into Industry 4.0, and IoT combined with experiences from the digitalLab@HSR, leading into the concept of closed-loop PLM.
I liked in particular how Felix brought the various views on the product together into one diagram, telling the full story of closed-loop PLM – necessary for a modern implementation framework.
A new age for airships
The last presentation of the day was from Chris Daniels describing the journey of Hybrid Air Vehicles with their Airlander 10 project. Where the classical airships, the most infamous perhaps the Hindenburg, have disappeared due to their flaws, the team of Hybrid Air Vehicles built upon the concept of airships in a defense project with the target to deliver a long endurance multi-intelligence vehicle. The advantage of airships is that they can stay in the air for several days, serving as communication hotspot, communication or rescue ship for places hard to reach with traditional aircraft or helicopter. The Airlander can be operation without going back to a base for 5 days, which is extremely long when you compare this to other aircraft.
The Airlander project is a typical example of incremental innovation used to optimize and extend the purpose of an airship. Combined with the fact that Chris was an excellent speaker made it a great closure of the day
This post is just an extract of one day and one stream of the conference. Already too large for a traditional blog post. Next week I will follow-up with day two and respond beyond 140 characters to the tweet below:
Last week I got the following question:
Many companies face the challenges relevant to the cooperation and joint ventures and need to integrate in a smart way the portfolio’s to offer integrated solutions. In the world of sharing and collaboration, this may be a good argument to dig into. Is PLM software ready for this challenge with best practice solutions or this is a matter that is under specific development case by case? Any guidelines?
Products were pushed to the market based on marketing research and closed innovation. Closed innovation meant companies were dependent on their internal R&D to provide innovative products. And this is the way most PLM systems are implemented: supporting internal development. Thanks to global connectivity, the internal development teams can collaborate together connected to a single PLM backbone/infrastructure.
Third Party Products (TPP) at that time were sometimes embedded in the EBOM, and during the development phase, there would be an exchange of information between the OEM and the TPP provider. Third Party Products were treated in a similar manner as purchase items. And as the manufacturing of the product was often defined in the ERP system, there the contractual and financial interactions with the TTP provider were handled, creating a discontinuity between what has been defined for the product and what has been shipped. The disconnect between the engineering intent and actual delivery to the customer often managed in Excel spreadsheets or proprietary databases developed to soften the pain
What is happening now?
In the past 10 – 15 years there is the growing importance of first electronic components and their embedded software now followed by new go-to-market approaches, where the customer proposition changes from just a product, towards a combined offering of hardware, software, and services. Let´s have a look how this could be done in a PLM environment.
From Products to Solutions
The first step is to manage the customer proposition in a logical manner instead of managing all in a BOM definition. In traditional businesses, most companies still work around multiple Bill of Materials. For example, read this LinkedIn post: The BOM is King. This approach works when your company only delivers hardware.
Not every PLM system supports Out-Of-The-Box a logical structure. I have seen implementations where this logical structure was stored in an external database (not preferred) or as a customized structure in the PLM system. Even in SmarTeam, this methodology was used to support Asset Lifecycle Management. I wrote about this concept early 2014 in the context of Service Lifecycle Management(SLM) two posts: PLM and/or SLM ? and PLM and/or SLM (continued). It is no coincidence that concepts used for connecting SLM to PLM are similar to defining customer propositions.
In the figure to the left, you can see the basic structure to manage a customer proposition and how it would connect to the aspects of hardware, software, and services. In an advanced manner, the same structure could be used with configuration rules to define and create a portfolio of propositions. More about this topic potential in a future blog post.
For hardware, most PLM systems have their best practices based on the BOM as discussed before. When combining the hardware with embedded software, we enter the world of systems. The proposition is no longer a product it becomes a system or even an experience.
For managing systems, I see two main additions to the classical PLM approach:
- The need for connected systems engineering. As the behavior of the system is much more complicated than just a hardware product, companies discover the need to spend more time on understanding all the requirements for the system and its potential use cases in operation – the only way to define the full experience. Systems Engineering practices coming from Automotive & Aerospace are now coming into the world of high-tech, industrial equipment, and even consumer goods.
- The need to connect software deliverables. Software introduces a new challenge for companies, no matter if the software is developed internally or embedded through TTP. In both situations, there is the need to manage change in a fast and iterative manner. Classical ECR /ECO processes do not work here anymore. Working agile and managing a backlog becomes the mode. Application Lifecycle Management connected to PLM becomes a need.
In both domains, systems engineering, and ALM, PLM vendors have their offerings, and on the marketing side, they might all look the same to you. However, there is a fundamental need that is not always visible on the marketing slides, the need for complete openness.
To manage a portfolio based on systems a company can no longer afford to manually check in multiple management systems all the dependencies between the product and its components combined with the software deliverables and TTPs. Automation, traceability on changes and notifications are needed in a modern, digital environment, which you might call a product innovation platform. My high-speed blog buddy Oleg Shilovitsky just dedicated a post to “The Best PLM for Product Innovation Platform” sharing several quotes from CIMdata´s talk about characteristics of a Product Innovation Platform and stressing the need for openness.
It is true if you can only manage your hardware (mechanics & electronics) and software in dedicated systems, your infrastructure will be limited and rigid as the outside world is in constant and fast changes. No ultimate solution or product does it all and will do it all in the future. Therefore openness is crucial.
In several companies, original in the Engineering, Procurement & Construction industry, I have seen the need to manage services in the context of the customer delivery too. Highly customized systems and/or disconnected systems were used here. I believe the domain of managing a proposition, a combination of hardware, software, AND services in a connected environment is still in its early days. Therefore the question marks in the diagram.
How Third Party Products management are supported by PLM depends very much on the openness of the PLM system. How it connects to ALM and how the PLM system is able to manage a proposition. If your PLM system has been implemented as a supporting infrastructure for Engineering only, you are probably not ready for the modern digital enterprise.
Other thoughts ???
The past year I have written about PLM in the context of digital transformation, relevant for companies that deliver products to the market. Some years ago, I have advocated the value of a PLM infrastructure for EPC companies and Owners/Operators of a plant.
EPC stands for Engineering, Construction, and Procurement, a typical name for often large capital-intensive projects, executed by a consortium of companies. Together they create buildings, platforms, plants, infrastructure and more one-off deliveries, which will be under control of the Owner/Operator after going-live.
2014 EPC related: The year the construction industry did not discover PLM
2013 Owner/Operators related: PLM for all industries?
As you can see from the dates, these posts are not the most recent posts. Meanwhile, EPC-based businesses are discovering the value of a PLM infrastructure. Main component for them is BIM (Building Information Model or Building Information Management) and they use cloud-based collaboration environments to be more cost-efficient. Slowly these companies are moving to a single repository of the data supporting multidisciplinary collaboration related to a BIM model to guarantee a continuity of data and better execution. I am positive about EPC companies that are discovering the value of PLM- It might be slightly different from classical product-selling companies, mainly because data ownership is different. In an EPC environment many companies are responsible for parts of the data and each of them keeps the real knowledge as IP (Intellectual Property) for themselves. They only “publish” deliverables. For companies that deliver products to the market, the OEM keeps responsibility for all relevant product information and h has a different strategy.
I worked in the past with one of my peers, Bjorn Fidjeland (www.plmpartner.com) on PLM for EPCs and Owner/Operators. We share the same passion to bring PLM outside traditional industries. As Bjorn is now more active than I am in this domain, I recommend to read Bjorn´s posts on this topic. For example:
EPC related 2016: Handover to logistics and supply chain in capital projects
Owner/Operators 2015: Plant Information Management – Information Structures
Bjorn provides a lot of details, which are important as implementing PLM for EPCs or Owner/Operators requires different data structures. I wrote about these concepts in 2014 in two posts – PLM and/or SLM ? post 1 and post 2. At that time not realizing the virtual twin was becoming popular.
PLM complementary to EAM
The last year I have explored these concepts together with (potential) Owner/Operators of a plant, where PLM would be complementary to their EAM system. In the world of Owner/Operators, Enterprise Asset Management (EAM) software is the major software these companies use. You find some of the major EAM players here.
You will discover that all these software suites are good for plant operations, but they all have a challenge to support data consistency and quality in particular when dealing with plant changes and efficient, high-quality plant information management. Versioning and status management, typical PLM capabilities are often not there.
Owner/Operators have challenges with EAM environments as:
- EAM systems are designed to support an as-operated environment, assuming all data it correct. Support for Maintenance, Repair or Overhaul projects is often rudimentary and depending on document-driven processes. The primary business process of these companies is producing continuously, such as, electricity or chemicals. Therefore typical engineering projects to change or enhance the main production process do not have the same financial focus.
- A document-driven approach is the de facto standard common for these industries. Most of the time because the plant has been established through an EPC approach, which was 100 % document-driven due to the different disconnected disciplines/tools working at that time in the EPC project. As the asset information is stored and delivered in documents, most owners/operators keep the document-driven approach for future change projects.
Owners/operator can benefit significantly from a data-driven PLM system as complementary infrastructure to their EAM system. The PLM system will be the source for accurate asset information, manage the change and approvals for the assets and ultimately push the new released information to the EAM system. The PLM system will offer the full history an traceability of decisions made, important for regulatory bodies or insurance companies.
.A data-driven approach for asset information allows owners/operators to benefit from efficient processes, reducing strongly the amount of people required to process data (documents) or reducing the time for people working in maintenance and operations to search for data. I found a nice slide from IBM explaining the concept of PLM an EAM collaboration – see below:
The same benefits modern digital enterprises will have related to a data-driven approach will come available for owner/operators. Operational management is supported by the EAM system combined with real-time capabilities provided by a modern PLM systems to analyze, design and deliver changes to the plant without a costly data conversion process (e.g. compiling new documents) and disconnected processes.
Moving to a virtual twin
Interesting enough the digital transformation is bringing the concepts of connecting engineering, manufacturing and operations together into an infrastructure of digital platforms interacting together. Where owners/operators historically do not focus on optimizing the engineering process to build and maintain their assets, in the “classical” industries companies were not really focusing on how products behaved in the field after they were delivered. With digital continuity (the digital thread) and IoT now these “classical” companies can connect to their products in the field. Their products become assets of information, and in case these companies change their business offering into leasing products and services, these assets become managed assets, like the assets owner/operators are managing.
The concept of a virtual twin (or digital twin – image proprietary of GE) , where a virtual model-based environment is linked to one or more real instances in operations, is the dream of all industries. Preparing, Simulating and verifying changes in a virtual world is so much more efficient and cheaper that is allows for higher quality of products and in the case of plant operators higher safety will be the number one topic.
What I have learned so far from plant owners/operators is that they are struggling to grasp a modern digital enterprise concept as their current environment is not model-based but document-driven. Starting with PLM to complement their EAM system could be a first step to understand the value and business benefits of digital continuity. It requires a new way of thinking which is not a commodity at this time. It will happen in the next 5 to 10 years. Expect it to be driven by the realization of virtual twins in the industry and further BIM maturity. The future is model-based !!!
p.s. I am happy to announce WordPress provided a new feature to my blog. In the side panel you can now choose your language (based on Google Translate) if you have difficulties with English. Enjoy !
Recently, I have written about classical PLM (document-driven and sequential) and modern PLM (data-driven and iterative) as part of the upcoming digital transformation that companies will have to go through to be fit for the future. Some strategic consultancy companies, like Accenture, talk about Digital PLM when referring to a PLM environment supporting the digital enterprise.
From classical PLM to Digital PLM?
The challenge for all companies is to transform their businesses to become customer-centric and find a transformation path from the old legacy PLM environment towards the new digital environment. Companies want to do this in an evolutionary mode. However my current observations are that the pace of an evolutionary approach is too slow related to what happens in their market. This time the change is happening faster than before.
A Big Bang approach towards the new environment seems to be a big risk. History has taught us that this is very painful and costly. To be avoided too. So what remains is a kind of bimodal approach, which I introduced in my recent blog posts (Best Practices or Next Practices). Although one of my respected readers and commenters Ed Lopategui mentioned in his comment (here) bimodal is another word for coexistence. He is not optimistic about this approach either
So, what remains is disruption?
And disruption is a popular word and my blog buddy Oleg Shilovitsky recently dived into that topic again with his post: How to displace CAD and PLM industry incumbents. An interesting post about disruption and disruption patterns. My attention was caught by the words: digital infrastructure.
How it might happen? Here is one potential answer – digital infrastructure. Existing software is limited to CAD files stored on a desktop and collaboration technologies developed 15-20 years using relational database and client-server architecture.
As I mentioned the words, Digital Infrastructure triggered me to write this post. At this moment, I see companies marketing their Digital Transformation story in a slick way, supported by all the modern buzz words like; customer-centric, virtual twin and data-driven. You would imagine as a PLM geek that they have already made the jump from the old document-driven PLM towards modern digital PLM. So what does a modern digital PLM environment look like ?
The reality, however, behind this slick marketing curtain, is that there are still the old legacy processes, where engineers are producing drawings as output for manufacturing. Because drawings are still legal and controlled information carriers. There is no digital infrastructure behind the scenes. So, what would you expect behind the scenes?
Model-Based Definition as part of the digital infrastructure
Crucial to be ready for a digital infrastructure is to transform your company´s product development process from a file-based process where drawings are leading towards a model-based enterprise. The model needs to be the leading authority (single source of truth) for PMI (Product Manufacturing Information) and potentially for all upfront engineering activities. In this case, we call it Model-Based Systems Engineering sometimes called RFLP (Requirements-Functional-Logical-Product), where even the product can be analyzed and simulated directly based on the model.
A file-based process is not part of a digital infrastructure or model-based enterprise architecture. File-based processes force the company to have multiple instances and representations of the same data in different formats, creating an overhead of work to keep up quality and correctness of data, that is not 100 % secure. A digital infrastructure works with connected data in context.
Therefore, if your company is still relying on drawings and you want to be ready for the future, a first step towards a digital infrastructure would be fixing your current processes to become model-based. Some good introductions can be found here at ENGINEERING.com – search for MBD and you will find:
Moving to Mode-Based is already a challenging transformation inside your company before touching the challenge of moving towards a full digital enterprise, through evolution, disruption or bimodal approach – let the leading companies show the way.
Companies should consider and investigate how to use a Model-Based Engineering approach as a first step to becoming lean and fit for a digital future. The challenge will be different depending on the type of industry and product.
I am curious to learn from my readers where they are on the path to a digital enterprise.
In my earlier post The weekend after PDT Europe I wrote about the first day of this interesting conference. We ended that day with some food for thought related to a bimodal PLM approach. Now I will take you through the highlights of day 2.
Interoperability and openness in the air (aerospace)
I believe Airbus and Boeing are one of the most challenged companies when it comes to PLM. They have to cope with their stakeholders and massive amount of suppliers involved, constrained by a strong focus on safety and quality. And as airplanes have a long lifetime, the need to keep data accessible and available for over 75 years are massive challenges. The morning was opened by presentations from Anders Romare (Airbus) and Brian Chiesi (Boeing) where they confirmed they could switch the presenter´s role between them as the situations in Airbus and Boeing are so alike.
Anders Romare started with a presentation called: Digital Transformation through an e2e PLM backbone, where he explained the concept of extracting data from the various silo systems in the company (CRM, PLM, MES, ERP) to make data available across the enterprise. In particular in their business transformation towards digital capabilities Airbus needed and created a new architecture on top of the existing business systems, focusing on data (“Data is the new oil”).
In order to meet a data-driven environment, Airbus extracts and normalizes data from their business systems and provides a data lake with integrated data on top of which various apps can run to offer digital services to existing and new stakeholders on any type of device. The data-driven environment allows people to have information in context and almost real-time available to make right decisions. Currently, these apps run on top of this data layer.
Now imagine information captured by these apps could be stored or directed back in the original architecture supporting the standard processes. This would be a real example of the bimodal approach as discussed on day 1. As a closing remark Anders also stated that three years ago digital transformation was not really visible at Airbus, now it is a must.
Next Brian Chiesi from Boeing talked about Data Standards: A strategic lever for Boeing Commercial Airplanes. Brian talked about the complex landscape at Boeing. 2500 Applications / 5000 Servers / 900 changes annually (3 per day) impacting 40.000 users. There is a lot of data replication because many systems need their own proprietary format. Brian estimated that if 12 copies exist now, in the ideal world 2 or 3 will do. Brian presented a similar future concept as Airbus, where the traditional business systems (Systems Engineering, PLM, MRP, ERP, MES) are all connected through a service backbone. This new architecture is needed to address modern technology capabilities (social / mobile / analytics / cloud /IoT / Automation / ,,)
Interesting part of this architecture is that Boeing aims to exchange data with the outside world (customers / regulatory/supply chain /analytics / manufacturing) through industry standard interfaces to have an optimal flow of information. Standardization would lead to a reduction of customized applications, minimize costs of integration and migration, break the obsolescence cycle and enable future technologies. Brian knows that companies need to pull for standards, vendors will deliver. Boeing will be pushing for standards in their contracts and will actively work together with five major Aerospace & Defense companies to define required PLM capabilities and have a unified voice to PLM solutions providers.
My conclusion on these to Aerospace giants is they express the need to adapt to move to modern digital businesses, no longer the linear approach from the classic airplane programs. Incremental innovation in various domains is the future. The existing systems need to be there to support their current fleet for many, many years to come. The new data-driven layer needs to be connected through normalization and standardization of data. For the future focus on standards is a must.
Simon Floyd from Microsoft talked about The Impact of Digital Transformation in the Manufacturing Enterprise where he talked us through Digital Transformation, IoT, and analytics in the product lifecycle, clarified by examples from the Rolls Royce turbine engine. A good and compelling story which could be used by any vendor explaining digital transformation and the relation to IoT. Next, Simon walked through the Microsoft portfolio and solution components to support a modern digital enterprise based on various platform services. At the end, Simon articulated how for example ShareAspace based on Microsoft infrastructure and technology can be an interface between various PLM environments through the product lifecycle.
Simon’s presentation was followed by a panel discussion where the theme was: When is history and legacy an asset and barriers of entry and When does it become a burden and an invitation to future competitors.
Mark Halpern (Gartner) mentioned here again the bimodal thinking. Aras is bimodal. The classical PLM vendors running in mode 1 will not change radically and the new vendors, the mode 2 types will need time to create credibility. Other companies mentioned here PropelPLM (PLM on Salesforce platform) or OnShape will battle the next five years to become significant and might disrupt.
Simon Floyd(Microsoft) mentioned that in order to keep innovation within Microsoft, they allow for startups within in the company, with no constraints in the beginning to Microsoft. This to keep disruption inside you company instead of being disrupted from outside. Another point mentioned was that Tesla did not want to wait till COTS software would be available for their product development and support platform. Therefore they develop parts themselves. Are we going back to the early days of IT ?
Interesting trend I believe too, in case the building blocks for such solution architecture are based on open (standardized ?) services.
After the lunch, the conference was split in three streams where I was participating in the “Creating and managing information quality stream.” As I discussed in my presentation from day 1, there is a need for accurate data, starting a.s.a.p. as the future of our businesses will run on data as we learned from all speakers (and this is not a secret – still many companies do not act).
In the context of data quality, Jean Brange from Boost presented the ISO 8000 framework for data and information quality management. This standard is now under development and will help companies to address their digital needs. The challenge of data quality is that we need to store data with the right syntax and semantic to be used and in addition, it needs to be pragmatic: what are we going to store that will have value. And then the challenge of evaluating the content. Empty fields can be discovered, however, how do you qualify the quality of field with a value. The ISO 8000 framework is a framework, like ISO 9000 (product quality) that allow companies to work in a methodological way towards acceptable and needed data quality.
Magnus Färneland from Eurostep addressed the topic of data quality and the foundation for automation based on the latest developments done by Eurostep on top of their already rich PLCS data model. The PLCS data model is an impressive model as it already supports all facets of product lifecycle from design, through development and operations. By introducing soft typing, EuroStep allows a more detailed tuning of the data model to ensure configuration management. When at which stage of the lifecycle is certain information required (and becomes mandatory) ? Consistent data quality enforced through business process logic.
The conference ended with Marc Halpern making a plea for Take Control of Your Product Data or Lose Control of Your Revenue, where Marc painted the future (horror) scenario that due to digital transformation the real “big fish” will be the digital business ecosystem owner and that once you are locked in with a vendor, these vendors can uplift their prices to save their own business without any respect for your company’s business model. Marc gave some examples where some vendor raised prices with the subscription model up to 40 %. Therefore even when you are just closing a new agreement with a vendor, you should negotiate a price guarantee and a certain bandwidth for increase. And on top of that you should prepare an exit strategy – prepare data for migration and have backups using standards. Marc gave some examples of billions extra cost related to data quality and loss. It can hurt !! Finally, Marc ended with recommendations for master data management and quality as a needed company strategy.
Gerard Litjens from CIMdata as closing speaker gave a very comprehensive overview of The Internet of Thing – What does it mean for PLM ? based on CIMdata’ s vision. As all vendors in this space explain the relation between IoT and PLM differently, it was a good presentation to be used as a base for the discussion: how does IoT influence our PLM landscape. Because of the length of this blog post, I will not further go into these details – it is worth obtaining this overview.
Concluding: PDT2016 is a crucial PLM conference for people who are interested in the details of PLM. Other conferences might address high-level customer stories, at PDT2016 it is about the details and sharing the advantages of using standards. Standards are crucial for a data-driven environment where business platforms with all their constraints will be the future. And I saw more and more companies are working with standards in a pragmatic manner, observing the benefits and pushing for more data standards – it is not just theory.
See you next year ?
At this moment I am finalizing my session for PDT2016 where I will talk about the importance of accurate data. Earlier this year I wrote a post about that theme: The importance of accurate data. Act now!
My PDT session will be elaborating on this post, with a focus on why and how we need this change in day-to-day business happen. So if you are interested in a longer story and much more interesting topics to learn and discuss, come to Paris on 9 and 10 November.
Dreaming is free
Recently I found a cartoon on LinkedIn and shared it with my contacts, illustrating the optimistic view companies have when they are aiming to find the best solution for their business, going through an RFI phase, the RFP phase, and ultimately negotiation the final deal with the PLM solution provider or vendor. See the image below:
All credits to the author – I found this image here
The above cartoon gives a humoristic view of the (PLM) sales process (often true). In addition, I want to share a less optimistic view related to PLM implementations after the deal has been closed. Based on the PLM projects if have been coaching in the past, the majority of these projects became in stress mode once the stakeholders involved only focused on the software, the functions and features and centralizing data. Implementing the software without a business transformation caused a lot of discomfort.
Users started to complain that the system did not allow them to do their day-to-day work in the same way. And they were right! They should have a new day-to-day work in the future, with different priorities based on the new PLM infrastructure.
This cultural change (and business change) was often not considered as the PLM system was implemented from an IT-perspective, not with a business perspective.
Over time, a better understanding of PLM and the fact that vendors and implementers have improved their portfolio and implementation skills, classical PLM implementations are now less disruptive.
A classical PLM implementation can be done quickly is because the system most of the time does not change the roles and responsibilities of people. Everyone remains working in his/her own silo. The difference: we store information in a central place so it can be found. And this approach would have worked if the world was not changing.
The digital enterprise transformation.
With the upcoming digitization and globalization of the market, enterprises are forced to adapt their business to become more customer-driven. This will have an impact on how PLM needs to be implemented. I wrote about this topic in my post: From a linear world to fast and circular. The modern digital enterprise has new roles and responsibilities and will eliminate roles and responsibilities that can be automated through a data-driven, rule-based approach. Therefore implementing PLM in a modern approach should be related (driven) by a business transformation and not the other way around!
In the past two years, I have explained this story to all levels inside various organizations. And nobody disagreed. Redefining the processes, redefining roles was the priority. And we need a team to help people to make this change – these people are change management experts. The benefits diagram from Gartner as shown below was well understood, and most companies agreed the ambition should be to the top curve, in any case, stay above the red curve
But often reality relates to the first cartoon. In the majority of the implementations I have seen the past two years, the company did not want to invest in change management, defining the new process and new roles first for an optimum flow of information. They spent the entire budget on software and implementation services. With a minimum of staff, the technology was implemented based on existing processes – no change management at all. Disappointing, as short-term thinking destroyed the long-term vision and benefits were not as large as they had been dreaming.
Without changing business processes and cultural change management, the PLM team will fight against the organization, instead of surfing on the wave of new business opportunities and business growth.
If your company is planning to implement modern PLM which implicit requires a business transformation, make sure cultural change management is part of your plan and budget. It will bring the real ROI. Depending on your company´s legacy, if a business transformation is a mission impossible, it is sometimes easier to start a new business unit with new processes, new roles and potentially new people. Otherwise, the benefits will remain (too) low from your PLM implementation.
I am curious to learn your experience related to (the lack) of change management – how to include it into the real scope – your thoughts ?
As a reaction to this post, Oleg Shilovitsky wrote a related blog post: PLM and the death spiral of cultural change. See my response below to this post as it will contribute to the understanding of this post
Oleg, thanks for contributing to the theme of cultural change. Your post illustrates that my post was not clear enough, or perhaps too short. I do not believe PLM is that difficult because of technology, I would even claim that technology is a the bottom of my list of priorities. Not stating it is not important, but meaning that when you are converging with a company to a vision for PLM, you probably know the kind of technologies you are going to use.
The highest priority to my opinion is currently the business transformation companies need to go through in order to adapt their business to remain relevant in a digital world. The transformation will require companies to implement PLM in a different manner, less silo-oriented, more focus on value flows starting from the customer.
Working different means cultural change and a company needs to allocate time, budget and energy to that. The PLM implementation is supporting the cultural change not driving the cultural change.
And this is the biggest mistake I have seen everywhere. Management decides to implement a new PLM as the driver for cultural change, instead of the result of cultural change. And they reason this is done, is most of the time due to budget thinking as cultural change is ways more complex and expensive than a PLM implementation.
The past half-year I have been intensively discussing potential PLM roadmaps with companies of different sizes and different maturity in PLM. Some companies are starting their PLM journey after many years of discussion and trying to identify the need and scope, others have an old PLM implementation (actually most of the time it is cPDM) where they discover that business paradigms from the previous century are no longer sufficient for the future.
The main changing paradigms are:
- From a linear product-driven delivery process towards an individual customer focused offering based on products and effective services, quickly -adapting to the market needs.
- From a document-driven, electronic files exchange based processes and systems towards data-driven platforms supporting information to flow in almost real-time through the whole enterprise.
Both changes are related and a result of digitization. New practices are under development as organizations are learning how to prepare and aim for the future. These new practices are currently dominating the agenda from all strategic consultancy firms as you cannot neglect the trend towards a digital enterprise. And these companies need next practices.
And what about my company?
It is interesting to see that most of the PLM implementers and vendors are promoting best practices, based on their many years of experience working having customers contributing to functionality in their portfolio.
And it is very tempting to make your customer feel comfortable by stating:
“We will implement our (industry) best practices and avoid customization – we have done that before!”
I am sure you have heard this statement before. But what about these best practices as they address the old paradigms from the past?
Do you want to implement the past to support the future?
Starting with PLM ? Use Best Practices !
If the company is implementing PLM for the first time and the implementation is bottom-up you should apply the old PLM approach. My main argument: This company is probably not capable/ready to work in an integrated way. It is not in the company´s DNA yet. Sharing data and working in a controlled environment is a big step to take. Often PLM implementations failed at this point as the cultural resistance was too big.
When starting with classical PLM, avoid customization and keep the scope limited. Horizontal implementations (processes across all departments) have more success than starting at engineering and trying to expand from there. An important decision to make at this stage is 2D leading (old) or the 3D Model leading (modern). Some future thoughts: How Model-based definition can fix your CAD models. By keeping the scope limited, you can always evolve to the next practices in 5 -10 years (if your company is still in business).
Note 1: remark between parenthesis is a little cynical and perhaps for the timeframe incorrect. Still, a company working bottom-up has challenges to stay in a modern competitive global environment.
Note 2: When writing this post I got notified about an eBook available with the tittle Putting PLM within reach written by Jim Brown. The focus is on cloud-based PLM solution that require less effort/investments on the IT-side and as side effect it discourages customization (my opinion) – therefore a good start.
Evolving in PLM – Next Practices
Enterprises that have already a PDM/PLM system in place for several years should not implement the best practices. They have reached the level that the inhibitors off a monolithic, document based environment are becoming clear.
They (must) have discovered that changing their product offering or their innovation strategy now with partners is adding complexity that cannot be supported easily. The good news, when you change your business model and product offering, there is C-level attention. This kind of changes do not happen bottom-up.
Unfortunate business changes are often discussed at the execution level of the organization without the understanding that the source of all products or offering data needs to be reorganized too. PLM should be a part of that strategic plan and do not confuse the old PLM with the PLM for the future.
The PLM for the future has to be built upon next practices. These next practices do not exists out of the box. They have to be matured and experienced by leading companies. The price you pay when being a leader Still being a leader bring market share and profit your company cannot meet when being a follower.
The Bi-modal approach
As management of a company, you do not want a disruption to switch from one existing environment to a new environment. Too much risk and too disruptive – people will resist – stress and bad performance everywhere. As the new data-driven approach is under development (we are learning), the end target is still moving.
Evolving using the old PLM system towards the new PLM approach is not recommended. This would be too expensive, slow and cumbersome. PLM would get a bad reputation as all the complexity of the past and the future are here. It is better to start the new PLM with a new business platform and customer-oriented processes for a limited offering and connect it to your legacy PLM.
Over the years the new PLM will become more clear and grow where the old PLM will become less and less relevant. Depending on the dynamics of your industry this might take a few years till decades.
It must and will be a business-driven learning path for new best practices
Best Practices and Next Practices are needed in parallel. Depending on the maturity and lack of sharing information in your company, you can choose. Consider the bi-modal approach to choose a realistic time path.
What do you think? Could this simplified way of thinking help your company?