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observation It has been silent from my side the past – more than two months. Extremely busy and sometimes surprised to see the amounts of post some of my colleagues could produce, with Oleg as the unbeaten number one. During this busy period I was able to observe some interesting trends listed below:

Going Social

Social Media and PLM is one of the favorite topics for both bloggers and some PLM vendors at this moment. New products for community based collaboration or social engineering  are promoted. Combined with discussions and statements how the new workforce (Generation Y) should get challenging jobs without doing the ‘old boring stuff’.

True arguments to initiate a change in the way we work.  And I agree, must of current PLM systems are not ‘intelligent’ enough to support engineers in a friendly manner. However is there an alternative at this moment ? Below a commercial (in Dutch) promoting that elderly workers are still required for quality.

I discussed the relation PLM and Social Media some time ago in my post Social Media and PLM explained for dummies. In addition my observation from the field, gives me the feeling that in most companies the management is still dominated by the older generation, and most of the time they decide on the tools they will be using.  No X and Y at this moment. Therefore I do not see a quick jump to social media integrated with PLM – yes the vision is there – but the readiness of most companies is not yet there.

Cloud

PLM and Cloud are also more and more mentioned by PLM vendors as a new solution specially for the mid-market.  And with an optimistic mind you can indeed believe that with a low investment (pay per use) mid-market companies can do their PLM on-line. But why are existing on-line PLM systems not booming at this time ? (Arena  / PLMplus / and the major PLM vendors) I believe that there are two key reasons for that:

  1. Implementing PLM is not equal to installing a  system. PLM is a vision to be implemented using a system. And the difficulty is that a vision does not match function and features from a product vendor. There is a need for a driving force inside the company that will support the business change. Where are the consultants and advocates (with experience) for this type of solutions ?knowledge_theft
  2. There is still a reluctance to store intellectual property somewhere on-line in a cloud without direct control  and ownership of data. Mid-market companies are not known to choose solutions ahead of the mass. In this type of companies cloud based CAD tools might be an entry point, but all product data – no way they say.

 

 

PLM or ERP

Before even talking about new technologies or fundamentals for PLM, I see the biggest challenge for PLM is still to get the recognition as the system for product knowledge (IP) and innovation. In too many companies ERP rules and PLM is considered as a way to capture CAD and engineering data. The main PLM vendors are not addressing this challenge – they neglect ERP (yes we can connect). And ERP vendors like SAP and Oracle are not known for their PLM messages and strategy  (yes we have PLM). As ERP is often the major IT-system historically, there is so often the (wrong) opinion that everything should be built and based on one system.

swiss

In some publications I have seen the Swiss knife as an example for the multi-functional system with all tools embedded. My question remains – who wants to work only with a Swiss knife when doing professional work ?

I like to have the right tools to do my job

The most important topic around my blog the past 3 years has been around the Manufacturing BOM – where should it be – and where is the MBOM current ?

Sweden – a reality check

Last week I attended the DS PLM forum in Gothenburg to present the vision of using a PLM system as the backbone for plant information management for owners/operators and how ENOVIA supports this vision.

PLM forum But I also learned Sweden is (one of) the most innovative countries (I need to verify the criteria used but can imagine there is a source of truth). What impressed me more where the presentations from  Staffan Lundgren from Sony Ericsson with the title “Living in a world of change – balancing stability and flexibility” and Magnus Olsson from Volvo Cars with the title “Driving operational excellence in a challenging business environment”. Both companies are well known for their robust image. From both speakers you could experience that they are not worried so much about Generation Y, their success is depending on a clear vision and a will to go there. And this basic drive is often missing – PLM is not a product you buy and then business continues as usual

Conclusion

PLM vendors made a lot of noise the past months (events / product announcements) and customers might get the impression that technology and software (or the price of software) are the main criteria for successful PLM. Although not unimportant, I would focus on the vision and to assure this vision is understood and accepted by the company. old_fashioned

Am I old fashioned ?

globe

Like many people, the meditation of the dark Christmas days and the various 2009 reviews give you a push to look back and reflect.  What happened and what did not happen in 2009?

And what might happen in 2010?

Here my thoughts related to:

 

ERP-related PLM vendors

Here I think mainly about Oracle and SAP. They have already identified PLM as an important component for a full enterprise solution. They are further pushing their one-shop-stop approach . Where Oracle’s offering is based on a set of acquired and to-be-integrated systems, SAP has been extending their offering by more focus on their own development.

vision If you are one of those companies that require PLM, and believe all software should come from one vendor (beside Microsoft), it is hard to decide.

As there might be real PLM knowledge in the Oracle organization as an effect of the acquisitions, but is it easily accessible for you? Is it reflected in the company’s strategy ?
With SAP I am even more in doubt; here you might find more people with ERP blood having learned the PLM talk. Maybe for that reason, I saw mostly Oracle as a PLM option in my environment and very few SAP opportunities for real PLM.

I assume in 2010 Oracle will push stronger and SAP try harder.

 

CAD-related PLM vendors

In this group you find as the major players PTC, Siemens and Dassault Systems. Autodesk could be there too, but they refuse to do PLM and remain focused around design collaboration. All these PLM vendors are striving to get the PLM message towards the mid-market. They have solutions for the enterprise, but to my feeling, most of the enterprises in the traditional well-know PLM markets, like Automotive and Aerospace, are in a kind of stand-still due to economical and upcoming environmental crisis.

It is sure business will not be as usual anymore, but where will the sustainable future go? Here I believe answers will come from innovation and small mid-market companies. The bigger enterprises need time to react so before we see new PLM activities in this area it will take time.

search Therefore all PLM vendors move in directions outside engineering, like apparel, life sciences, and consumer packaged goods. These industries do not rely on the 3D CAD, but still can benefit from the key building blocks of PLM, like lifecycle management, program and portfolio management and quality/compliancy management.  The challenge I believe for the PLM vendors is: Will these CAD-focused organizations be able to learn and adapt other industries fast enough? Where does 3D fit – although Dassault has a unique vision here.

For the mid-market, the PLM vendors offer more OOTB (Out Of The Box) solutions, mostly based on limited capabilities or more common available Microsoft components like SharePoint and SQL Server. This is not so strange as according to my observation, most smaller mid-market companies have not really made or understood the difference internally between document management and product data management, including Bill Of Materials not to be managed in Excel.

I assume 2010 the CAD related PLM vendors initially will focus on the bigger enterprises and new industries, the smaller mid-market companies require a different approach

 

PLM-only vendors

This is an area which I expect to disappear in the future, although this is also the area where interesting developments start to happen. We see open source PLM software coming up with Aras leading and we see companies coming up with PLM on-demand software, Arena as the first company to sell this concept.

fish

The fact that the traditional PLM-only vendors disappeared in this area  (Eigner bought by Agile, Agile bought by Oracle, MatrixOne bought by Dassault Systems) indicates that the classical way of selling PLM-only was not profitable enough.

Either PLM needs to be integrated in companywide business processes (which I believe), or there will be PLM-only vendors that find a business model to stay alive.

Here I hope to see more clarity in 2010

 

Smaller mid-market companies

planning What I have seen in the past year is, that despite the economical crisis, PLM investments by these companies remained active. Maybe not in purchasing much more licenses or implementing new PLM features. Main investments here were around optimizing or slightly extending the PLM base. Maybe because there was time to sit still and analyze what could be changed, or maybe it was planned but due to work pressure, it was never executed. Anyway there was a lot of activity in this area not less than in 2008.

An interesting challenge for these mid-market companies will be to remain attractive for the new generation. They are not used to the classical ways of structured work as most of the current workforce is used to.
Social networking, social PLM, I have seen the thoughts, discussions and benefits, still trying to see where it will become reality.

2010 is another chance.

 

Sustainability and going green

frog This is an area where I am a little disappointed and this is perhaps not justified. I would expect with the lessons learned around energy and the upcoming shortage of natural resources, companies would take the crisis as a reason to change.

To my observation most of the companies I have seen are still trying to continue as usual, hoping that the traditional growth will come back. The climate conference in Copenhagen also showed that, we as human beings, do not feel pressured enough to adapt, by nature we are optimists (or boiling frogs).

Still there are interesting developments – I assume in the next few years we will see innovation coming – probably first from smaller companies as they have the flexibility to react. During the European Customer Conference in Paris, I heard Bernard Charles talking about the concept of a Bill Of Energy (The energy needed to create, maintain and demolish a product) As PLM consultants we already have a hard time explaining to our customers the various views on a BOM, still I like the concept, as a Bill Of Energy makes products comparable.

2010 the acceptance of Bill Of Energy

Here I want to conclude my post for this year. Thank you all for reading and sharing your thoughts and comments with this community. My ultimate conclusion for 2009 is, that is was a good PLM year for the mid-market, better as expected but the changes are going slow. Too slow – we will see next year.

2010

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:

As a consultant working with mid-market companies,  I enjoyed reading this post from Al Dean and its related comments and posts. Although I must say Al’s statement:

observationPLM+ are looking to solve this by creating a rich application that engages the user, provides ease of implementation and ongoing maintenance (by allowing the user/admin, rather than costly consultant) and can be delivered over the web, in an on-demand manner (which saves hardware and infrastructure cost)

was a trigger to react, as I am a consultant.

The base of every PDM/PLM

First I believe the base of PLM and PDM is to agree inside your company that you share and centralize product data. This means not only files, but also Bill of Materials, Issues, etc, etc, ..

To share and centralize product data seems like an easy mission and this is what all PLM software as a base provides, and I assume PLM+ does the same, only they store the data in the cloud, like Arena.

coop Sharing data is not a natural process in all companies as there is always the culture to share the minimum and to keep the rest to prove your own value – the bigger the company the more this will happen. This is human nature and this differs case by case. To make people share data  is an area where either the management has to push, or in very small companies,  a power user. In larger companies, often an external consultant is doing this job, in the role of an ‘outsider’ who can moderate and explain the benefits for all, instead of the threats.

This is what consultants really do;  they do not install or administer systems.

PLM solutions can vary in the way they make  sharing of data available. Some solutions are very rigid in what they offer as data model, but most of the necessary entities and attributes are there. They are based on best practices and target the 80 %. Often this is good enough, if the customer has no alternative and has the power by themselves to enforce the system as their platform for sharing data.

80-20 More flexible PLM solutions have an advantage and in the same time this is their disadvantage. They can be extended beyond the 80 % scenario and both the implementer and the customer will be challenged to reach the 100 % satisfaction. However we all know from the 80-20 rule, this is where it gets complicated.

80 % of the project is done in 20 % of the time, or in other words: you spent 80 % of your time (and budget) on reaching the last 20 %

Once having reached a common platform for sharing all product related information, for me the real PLM is starting. This is where a company would implement processes, that streamline the product development or delivery process – it requires a cross departmental change.

And at this stage, it is often where  a consultant comes in. It is very rare, that in mid-market companies, management reserves time and resources to come with a strategic plan to implement PLM – I wrote about this in an older post. PLM requires a change in the way the company currently works.

So I am curious to learn how PLM+ and other On-Demand PLM software companies will try to address this step, as change is needed and someone has to push for it.

In my last three consecutive posts, I wrote about who decides on PLM in mid-market companies (a generalization from 15 years experience). There I claim that the selection for a PLM system is subjective, very much based on personal relations with the mid-market company. Again how PLM+ will address this in their business model, as there is a need for someone to push.

Open Source PLM software has somehow similar challenges. You need the drive from inside the customer to agree on sharing product data and next to extend. This is where the traditional PDM and PLM vendors  push their business in direct contacts. Of course Open Source PLM providers have their focus on after the initial installation of the platform to extend it with a consultative and service model.

 

Conclusion: As every PLM provider at the end needs revenue for  a living,  I am looking forward to see where On-Demand PLM will go and finds it place. What will be business model that makes people buy and create the change

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