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In my previous post, I shared my observations from the past 10 years related to PLM. It was about globalization and digitization becoming part of our daily business. In the domain of PLM, the coordinated approach has become the most common practice.
Now let’s look at the challenges for the upcoming decade, as to my opinion, the next decade is going to be decisive for people, companies and even our current ways of living. So let’s start with the challenges from easy to difficult
Challenge 1: Connected PLM
Implementing an end-to-end digital strategy, including PLM, is probably business-wise the biggest challenge. I described the future vision for PLM to enable the digital twin –How PLM, ALM, and BIM converge thanks to the digital twin.
Initially, we will implement a digital twin for capital-intensive assets, like satellites, airplanes, turbines, buildings, plants, and even our own Earth – the most valuable asset we have. To have an efficient digital continuity of information, information needs to be stored in connected models with shared parameters. Any conversion from format A to format B will block the actual data to be used in another context – therefore, standards are crucial. When I described the connected enterprise, this is the ultimate goal to be reached in 10 (or more) years. It will be data-driven and model-based
Getting to connected PLM will not be the next step in evolution. It will be disruptive for organizations to maintain and optimize the past (coordinated) and meanwhile develop and learn the future (connected). Have a look at my presentation at PLM Roadmap PDT conference to understand the dual approach needed to maintain “old” PLM and work on the future.
Interesting also my blog buddy Oleg Shilovitsky looked back on the past decade (here) and looked forward to 2030 (here). Oleg looks at these topics from a different perspective; however, I think we agree on the future quoting his conclusion:
PLM 2030 is a giant online environment connecting people, companies, and services together in a big network. It might sound like a super dream. But let me give you an idea of why I think it is possible. We live in a world of connected information today.
Challenge 2: Generation change
At this moment, large organizations are mostly organized and managed by hierarchical silos, e.g., the marketing department, the R&D department, Manufacturing, Service, Customer Relations, and potentially more.
Each of these silos has its P&L (Profit & Loss) targets and is optimizing itself accordingly. Depending on the size of the company, there will be various layers of middle management. Your level in the organization depends most of the time on your years of experience and visibility.
The result of this type of organization is the lack of “horizontal flow” crucial for a connected enterprise. Besides, the top of the organization is currently full of people educated and thinking linear/analog, not fully understanding the full impact of digital transformation for their organization. So when will the change start?
In particular, in modern manufacturing organizations, the middle management needs to transform and dissolve as empowered multidisciplinary teams will do the job. I wrote about this challenge last year: The Middle Management dilemma. And as mentioned by several others – It will be: Transform or Die for traditionally managed companies.
The good news is that the old generation is retiring in the upcoming decade, creating space for digital natives. To make it a smooth transition, the experts currently working in the silos will be missed for their experience – they should start coaching the young generation now.
Challenge 3: Sustainability of the planet.
The biggest challenge for the upcoming decade will be adapting our lifestyles/products to create a sustainable planet for the future. While mainly the US and Western Europe have been building a society based on unlimited growth, the effect of this lifestyle has become visible to the world. We consume with the only limit of money and create waste and landfill (plastics and more) form which the earth will not recover if we continue in this way. When I say “we,” I mean the group of fortunate people that grew up in a wealthy society. If you want to discover how blessed you are (or not), just have a look at the global rich list to determine your position.
Now thanks to globalization, other countries start to develop their economies too and become wealthy enough to replicate the US/European lifestyle. We are overconsuming the natural resources this earth has, and we drop them as waste – preferably not in our backyard but either in the ocean or at fewer wealth countries.
We have to start thinking circular and PLM can play a role in this. From linear to circular.
In my blog post related to PLM Roadmap/PDT Europe – day 1, I described Graham Aid’s (Ragn-Sells) session:
Enabling the Circular Economy for Long Term Prosperity.
He mentioned several examples where traditional thinking just leads to more waste, instead of starting from the beginning with a sustainable model to bring products to the market.
Combined with our lifestyle, there is a debate on how the carbon dioxide we produce influences the climate and the atmosphere. I am not a scientist, but I believe in science and not in conspiracies. So there is a problem. In 1970 when scientists discovered the effect of CFK on the Ozone-layer of the atmosphere, we ultimately “fixed” the issue. That time without social media we still trusted scientists – read more about it here: The Ozone hole
I believe mankind will be intelligent enough to “fix” the upcoming climate issues if we trust in science and act based on science. If we depend on politicians and lobbyists, we will see crazy measures that make no sense, for example, the concept of “biofuel.” We need to use our scientific brains to address sustainability for the future of our (single) earth.
Therefore, together with Rich McFall (the initiator), Oleg Shilovitsky, and Bjorn Fidjeland (PLM-peers), we launched the PLM Green Alliance, where we will try to focus on sharing ideas, discussion related to PLM and PLM-related technologies to create a network of innovative companies/ideas. We are in the early stages of this initiative and are looking for ways to make it an active alliance. Insights, stories, and support are welcome. More to come this year (and decade).
Challenge 4: The Human brain
The biggest challenge for the upcoming decade will be the human brain. Even though we believe we are rational, it is mainly our primitive brain that drives our decisions. Thinking Fast and Slow from Daniel Kahneman is a must-read in this area. Or Predictably Irrational: The Hidden Forces that shape our decisions. Note: these books are “old” books from years ago. However, due to globalization and social connectivity, they have become actual.
Our brain does not like to waste energy. If we see the information that confirms our way of thinking, we do not look further. Social media like Facebook are using their algorithms to help you to “discover” even more information that you like. Social media do not care about facts; they care about clicks for advertisers. Of course, controversial headers or pictures get the right attention. Facts are no longer relevant, and we will see this phenomenon probably this year again in the US presidential elections.
The challenge for implementing PLM and acting against human-influenced Climate Change is that we have to use our “thinking slow” mode combined with a general trust in science. I recommend reading Enlightenment now from Steven Pinker. I respect Steven Pinker for the many books I have read from him in the past. Enlightenment Now is perhaps a challenging book to complete. However, it illustrates that a lot of the pessimistic thinking of our time has no fundamental grounds. As a global society, we have been making a lot of progress in the past century. You would not go back to the past anymore.
Back to PLM.
PLM is not a “wonder tool/concept,” and its success is mainly depending on a long-term vision, organizational change, culture, and then the tools. It is not a surprise that it is hard for our brains to decide on a roadmap for PLM. In 2015 I wrote about the similarity of PLM and acting against Climate Change – read it here: PLM and Global Warming
In the upcoming PI PLMx London conference, I will lead a Think Tank session related to Getting PLM on the Executive’s agenda. Getting PLM on an executive agenda is about connecting to the brain and not about a hypothetical business case only. Even at exec level, decisions are made by “gut feeling” – the way the human brain decides. See you in London or more about this topic in a month.
Conclusion
The next decade will have enormous challenges – more than in the past decades. These challenges are caused by our lifestyles AND the effects of digitization. Understanding and realizing our biases caused by our brains is crucial. There is no black and white truth (single version of the truth) in our complex society.
I encourage you to keep the dialogue open and to avoid to live in a silo.
For me, the joint conference from CIMdata and Eurostep is always a conference to look forward too. The conference is not as massive as PLM-Vendor conferences (slick presentations and happy faces); it is more a collection of PLM-practitioners (this time a 100+) with the intent to discuss and share their understanding and challenges, independent from specific vendor capabilities or features. And because of its size a great place to network with everyone.
Day 1 was more a business/methodology view on PLM and Day 2 more in-depth focusing on standards and BIM. In this post, the highlights from the first day.
The State of PLM
Peter Bilello, CIMdata’s president, kicked of with a review of the current state of the PLM industry. Peter mentioned the PLM-market grew by 9.4 % to $47.8 billion (more than the expected 7 %). Good for the PLM Vendors and implementers.
However, Peter also mentioned that despite higher spending, PLM is still considered as a solution for engineering, often implemented as PDM/CAD data management. Traditional organizational structures, marketing, engineering, manufacturing, quality were defined in the previous century and are measured as such.
This traditional approach blocks the roll-out of PLM across these disciplines. Who is the owner of PLM or where is the responsibility for a certain dataset are questions to solve. PLM needs to transform to deliver end-to-end support instead of remaining the engineering silo. Are we still talking about PLM in the future? See Peter’s takeaways below:
We do not want to open the discussion if the the name PLM should change – too many debates – however unfortunate too much framing in the past too.
The Multi View BOM
Fred Feru from Airbus presented a status the Aerospace & Defense PLM action group are working on: How to improve and standardize on a PLM solution for multi-view BOM management, in particular, the interaction between the EBOM and MBOM. See below:
You might think this is a topic already solved when you speak with your PLM-vendor. However, all existing solutions at the participant implementations rely on customizations and vary per company. The target is to come up with common requirements that need to be addressed in the standard methodology. Initial alignment on terminology was already a first required step as before you standardize, you need to have a common dictionary. Moreover, a typical situation in EVERY PLM implementation.
An initial version was shared with the PLM Editors for feedback and after iterations and agreement to come with a solution that can be implemented without customization. If you are interested in the details, you can read the current status here with Appendix A en Appendix B.
Enabling the Circular Economy for Long Term Prosperity
Graham Aid gave a fascinating presentation related to the potentials and flaws of creating a circular economy. Although Graham was not a PLM-expert (till he left this conference), as he is the Strategy and Innovation Coordinator for the Ragn-Sells Group, which performs environmental services and recycling across Sweden, Norway, Denmark, and Estonia. Have a look at their website here.
Graham shared with us the fact that despite logical arguments for a circular economy – it is more profitable at the end – however, our short term thinking and bias block us from doing the right things for future generations.
Look at the missing link for a closed resource-lifecycle view below.
Graham shared weird examples where scarce materials for the future currently were getting cheaper, and therefore there is no desire for recycling them. A sound barrier with rubble could contain more copper than copper ore in a mine.
In the PLM-domain, there is also an opportunity for supporting and working on more sustainable products and services. It is a mindset and can be a profitable business model. In the PDT 2014 conference, there was a session on circular product development with Xerox as the best example. Circular product development but also Product As A Service can be activities that contribute to a more sustainable world. Graham’s presentation was inspiring for our PLM community and hopefully planted a few seeds for the future. As it is all about thinking long-term.
With the PLM Green Alliance, I hope we will be able to create a larger audience and participation for a sustainable future. More about the PLM Green Alliance next week.
The Fundamental Role of PLM in Data-driven Product Portfolio Management
Hannu Hannila (Polar) presented his study related to data-driven product portfolio management and why it should be connected to PLM. For many companies, it is a challenge to understand which products are performing well and where to invest. These choices are often supported by Data Damagement as Hannu called it.
An example below:
The result of this fragmented approach is that organizations make their decisions on subjective data and emotions. Where the assumption is that 20 % of the products a company is selling is related to 80 % of the revenue, Hannu found in his research companies where only 10 % of the products were contributing to the revenue. As PPM (Product Portfolio Management) often is based on big emotions – who shouts the loudest mentality, influenced by the company’s pet products and influence by the HIPPO (HIghest Paid Person in the Office). So how to get a better rationale?
Hannu explained a data-driven framework that would provide the right analytics on management level, depending on overall data governance from all disciplines and systems. See below:
I liked Hannu’s conclusions as it aligns with my findings:
- To be data-driven, you need Master Data Management and Data Governance
- Product Portfolio Management is the driving discipline for PLM, and in a modern digital enterprise, it should be connected.
Sponsor sessions
Sponsors are always needed to keep a conference affordable for the attendees. The sponsor sessions on day 1 were of good quality. Here a quick overview and a link if you want to invest further
Configit – explaining the value of a configurator that connects marketing, technical and sales, introducing CLM (Configuration Lifecycle Management) – a new TLA
Aras – explaining their view on what we consider the digital thread
Variantum – explaining their CPQ solution as part of a larger suite of cloud offerings
Quick Release – bringing common sense to PLM implementations, similar to what I am doing as PLM coach – focusing on the flow of information
SAP – explaining the change in focus when a company moves toward a product as a service model
SharePLM – A unique company addressing the importance of PLM training delivered through eLearning
Conclusion
The first day was an easy to digest conference with a good quality of presentations. I only shared 50 % of the session as we already reached 1000+ words. The evening I enjoyed the joint dinner, being able to network and discuss in depth with participants and finished with a social network event organized by SharePLM. Next week part 2.
After my previous post about the PLM migration dilemma, I had several discussions with peers in the field why these PLM bad news are creating so much debate. For every PLM vendor, I can publish a failure story if I want. However, the reality is that the majority of PLM implementations do not fail.
Yes, they can cause discomfort or friction in an organization as implementing the tools often forces people to work differently. And often working differently is not anticipated by the (middle) management and causes, therefore, a mismatch for the people, process & tools paradigm.
So we love bad news in real life. We talk about terrorism while meanwhile, a large number of people are dying through guns, cars, and even the biggest killer mosquitos. Fear stories sell better than success stories, and in particular, in the world of PLM Vendors, every failure of the competition is enlarged. However, there are more actors involved in a PLM implementation, and if PLM systems would be that bad, they would not exist anymore and replace by ………?
Who to blame – the vendor?
Of cou
rse, it is the easiest way to blame the vendor as their marketing is promising to solve all problems. However, when you look from a distance to the traditional PLM vendor community, you see they are in a rat-race to deliver the latest and greatest technology ahead of their competition, often driven by some significant customers.
Their customers are buying the vision and expect it to be ready and industrialized, which is not the case – look at the digital twin hype or AI (Artificial Intelligence). Released PLM software is not at the same maturity compared to office applications. Office applications do not innovate so much and have thousands of users during a beta-cycle and no dependency on processes.
Most PLM vendors are happy when a few customers jump on their latest release, combined with the fact that implementations of the most recent version are not yet a push on the button. This might change in the long term if PLM Vendors can deliver cloud-based solutions.
PLM implementations within the same industry might look the same but often vary a lot due to existing practices, which will not change due to the tool – so there is a need for customization or configuration.
PLM systems with strong business rules inside their core might more and more develop towards configuration, where PLM toolkit-like systems might focus on ease of customization. Both approaches have their pro’s and con’s (in another blog post perhaps).
Another topic to blame the vendor is lack of openness. You hear it in many discussions. If vendor X were open, they would not lock the data – a typical marketing slogan. If PLM vendors would be completely open, to which standards should they adhere? Every PLM has its preferred collection of tools together – if you stay within their portfolio you have a minimum of compatibility or interface issues.
This logic started already with SAP in the previous century. For PLM vendors, there is no business model for openness. For example, the SmarTeam APIs for connecting and extracting data are available free of charge, leading to no revenue for the vendor and significant revenue for service providers. Without any license costs, they can build any type of interface/solution. In the end, when the PLM vendor has no sustainable revenue, the vendor will disappear as we have seen between 2000 and 2010, where several stand-alone PLM systems disappeared.
So yes, we can blame PLM vendors for their impossible expectations – coming to realistic expectations related to capabilities and openness is probably the biggest challenge.
Who to blame – the implementer?
The second partner in a PLM implementation is the implementation partner, often a specialized company related to the PLM vendor. There are two types of implementation partners – the strategic partners and the system integrators.
Let’s see where we can blame them.
Strategic partners, the consultancy firms, often have a good relationship with the management, they help the company to shape the future strategy, including PLM. You can blame this type of company for their lack of connection to the actual business. What is the impact on the organization to implement a specific strategy, and what does this mean for current or future PLM?
Strategic partners should be the partner to support business change management as they are likely to have experience with other companies. Unfortunate, this type of companies does not have significant skills in PLM as the PLM domain is just a small subset of the whole potential business strategy.
You can blame them that they are useful in building a vision/strategy but fail to create a consistent connection to the field.
Implementation partners, the system integrators, are most of the times specialized in one or two PLM vendor’s software suites, although the smaller the implementation partner, the less broad their implementation skills. These implementation partners sometimes have built their own PLM best practices for a specific vendor and use this as a sales argument. Others just follow blindly what the vendor is promoting or what the customer is asking for.
They will do anything you request, as long as they get paid for it. The larger ones have loads of resources for offshore deliveries – the challenge you see here is that it might look cheap; however, it becomes expensive if there is no apparent convergence of the deliverables.
As I mentioned before they will never say No to a customer and claim to fill all the “gaps,” there are in the PLM environment.
You can blame implementation partners that their focus is on making money from services. And they are right, to remain in business your company needs to be profitable. It is like lawyers; they will invoice you based on their efforts. And the less you take on your plate, the more they will do for you.
The challenge for both consultancy partners as system integrators is to find a balance between experienced people, who really make it happen and educating juniors to become experts too. Often the customer pays for the education of these juniors
Who to blame – your company?
If your company is implementing PLM, then probably the perception is that that you made all the effort to make it successful. You followed the advice of the strategic consultants, you selected the best PLM Vendor and system integrator, you created a budget – so what could go wrong?
This all depends on your company’s ambition and scope for PLM.
Implementing the as-is processes
If your PLM implementation is just there to automate existing practices and store data in a central location, this might work out. And this is most of the time when PLM implementations are successful. You know what to expect, and your system integrator knows what to expect.
This type of project can run close to budget, and some system integrators might be tempted to offer a fixed price. I am not a fan of fixed priced projects as you never know exactly what needs to be done. The system integrator might raise the target price with 20 – 40 % to cover their risk or you as a company might select the cheapest bid – another guarantee for failure. A PLM implementation is not a one-time project, it is an on-going journey. Therefore your choice needs to be sustainable.
My experience with this type of implementations is that it easy to blame the companies here too. Often the implementation becomes an IT-project, as business people are too busy to run their day-to-day jobs, therefore they only incidentally support the PLM project. The result is that at a specific moment, users confronted with the system feel not connected to the new system – it was better in the past. In particular, configuration management and change processes can become waterproof, leaving no freedom for the users. Then the blaming starts – first the software then the implementer.
But what if you have an ambitious PLM project as part of a business transformation?
In that case, the PLM platform is just one of the elements to consider. It will be the enabler for new ways of working, enabling customer-centric processes, multi-discipline collaboration, and more. All related to a digital transformation of the enterprise. Therefore, I mention PLM platform instead of PLM system. Future enterprises run on data through connected platforms. The better you can connect your disciplines, the more efficient and faster your company will operate. This, as opposed to the coordinated approach, which I have been addressing several times in the past.
A business transformation is a combination of end-to-end understanding of what to change – from management vision connected to the execution in the field. And as there is not an out-of-the-box template for business transformation, it is crucial a company experiments, evaluates and when successful, scales up new habits.
Therefore, it is hard to define upfront all the effort for the PLM platform and the implementation resources. What is sure is that your company is responsible for that, not an external part. So if it fails, your company is to blame.
Is everyone to blame?
You might have the feeling that everyone is to blame when a PLM implementation fails. I believe that is indeed the case. If you know in advance where all players have their strengths and weaknesses, a PLM implementation should not fail, but be balanced with the right resources. Depending on the scope of your PLM implementation, is it a consolidation or a transformation, you should take care of all stakeholders are participating in the anti-blame game.
The anti-blame game is an exercise where you make sure that the other parties in the game cannot blame you.
- If you are a vendor – do not over commit
- If you are a consultant or system integrator – learn to say NO
- If you are the customer – make sure enough resources are assigned – you own the project. It is your project/transformation.
This has been several times my job in the past, where I was asked to mediate in a stalling PLM implementation. Most of the time at that time it was a blame game, missing the target to find a solution that makes sense. Here coaching from experienced PLM consultants makes sense.
Conclusion
Most of the time, PLM implementations are successful if the scope is well understood and not transformative. You will not hear a lot about these projects in the news as we like bad news.
To avoid bad news challenging PLM implementations should make sure all parties involved are challenging the others to remain realistic and invest enough. The role of an experienced external coach can help here.
Unfortunate one more time and old post with some new comments in green as I am not yet able to type at regular speed. I promise this will be the last reprise as I am sure in one week from now I will be double-handed again. The reason I chose this six-year-old post is that the topic is still actual, however, at that time, digital transformation was not yet in fashion for PLM.
If you look at the comments to the article at that time (Feb 2013), you will see some well-known names and behaviors. What I can state for the moment – there are still people doubting there is a need for PLM, there are still people blaming technology for the lousy perception of PLM, and there is a large group of silent companies out there that have implemented the basics of PLM, perhaps not as advanced as vendors/consultants have suggested, and they are reaping the benefits.
The main question in upcoming blog posts; “Is this enough ?” Happy rereading!
How come PLM is boring? – Feb 2013
PLM is a popular discussion topic in various blogs, LinkedIn discussion groups, PLM Vendor web sites, and for the upcoming Product Innovation Congress in Berlin. I look forward to the event to meet and discuss with attendees their experience and struggle to improve their businesses using PLM. (Meanwhile, PI PLMx London has passed – for a review look here –The weekend after PI PLMx London 2019)
From the other side, talking about pure PLM becomes boring. Sometimes it looks like PLM is a monotheistic topic:
- “What is the right definition of PLM ?” (I will give you the right one)
- “We are the leading PLM vendor” (and they all are)
- A PLM system should be using technology XYZ (etc., etc.)
- Digital Transformation and IoT have come into the picture now
Some meetings with customers in the past three weeks and two different blog posts I read recently made me aware of this ambiguity between boring and fun.
PLM dictating Business is boring
Oleg Shilovitsky´s sequence of posts (and comments) starting with A single bill of materials in 6 steps was an example of the boring part. (Sorry Oleg, as you publish so many posts, there are many that I like and some I can use as an example). When reading the BOM-related posts, I noticed they are a typical example of an IT- or Academic view on PLM, in particular on the BOM topic.
Will these posts help you after reading them? Do they apply to your business? Alternatively, do you feel more confused as a prolific PLM blogger makes you aware of all the different options and makes you think you should use a single bill of materials?
I learned from my customers and coaching and mediating hundreds of PLM implementations that the single BOM discussion is one of the most confusing and complicated topics. Moreover, for sure if you address it from the IT-perspective.
The customer might say:
“Our BOM is already in ERP – so if it is a single BOM, you know where it is – goodbye !”.
A different approach is to start looking for the optimal process for this customer, addressing the bottlenecks and pains they currently face. It will be no surprise that PLM best practices and technology are often the building blocks for the considered solution. If it will be a single BOM or a collection of structures evolving through time, this depends on the situation, not on the ultimate PLM system.
Note: meanwhile Oleg has further materialized his thinking through OpenBOM, and he has not lost his speed of publishing
Business dictating PLM is fun
Therefore I was happy to read Stephen Porter´s opinion and comments in: The PLM state: Penny-wise Pound Foolish Pricing and PLM (unfortunate this post has disappeared) where he passes a similar message like mine, from a different starting point, the pricing models of PLM Vendors. My favorite part is in his conclusion:
A PLM decision is typically a long term choice so make sure the vendor and partners have the staying power to grow with your company. Also make sure you are identifying the value drivers that are necessary for your company’s success and do not allow yourself to be swayed by the trendy short term technology
Management in companies can be confused by starting to think they just need PLM because they hear from the analysts, that it improves business. They need to think first to solve their business challenges and change the way they currently work to improve. Moreover, next look for the way to implement this change.
Not:e Stephen wrote at that time an interesting series of post and promised a revival. However I haven’t seen new posts. Did anyone of my readers see new materials that I missed?
Changing the way to work is the problem, not PLM.
It is not the friendly user-interface of PLM system XYZ or the advanced technical capabilities of PLM system ABC, that will make a PLM implementation easier. Nothing is solved on the cloud or by using a mobile device. If there is no change when implementing PLM, why implement and build a system to lock yourself in even more?
This is what Thomas Schmidt (VP Head of Operational Excellence and IS at ABB’s Power Products Division) told last year at PLM Innovation 2012 in Munich. He was one of the keynote speakers and surprised the audience by stating he did not need PLM!
He explained this by describing the business challenges ABB has to solve: Being a global company but acting around the world as a local company. He needed product simplification, part reduction among product lines around the world, compliance, and more.
Note: Thomas Schmidt meanwhile moved forward in his career, identifying himself as Experienced “Change Leader”, digital transformation, mentor and coach
Another customer in a whole different industry mentioned they were looking for improving global instant collaboration as the current information exchange is too slow and error-prone. Besides, they want to capitalize on the work done and make it accessible and reusable in the future, authoring tool independent. However, they do not call it PLM as in their business nobody uses PLM!
Both cases should make a PLM reseller´s mouths water (watertanden in Dutch), as these companies are looking for critical capabilities available in most of the PLM systems. However, none of these companies asked for a single BOM or a service-oriented architecture. They wanted to solve their business issues. Moreover, for sure, it will lead to implementing PLM capabilities when business and IT-people together define and decide on the right balance.
Unfortunate here we still see a function-feature approach – if it is not there, we will build it
Management take responsibility
Combining PLM and new business needs is the responsibility of management in these companies. It is crucial that a business issue (or a new strategy) is the driving force for a PLM implementation. PLM is not about automating what we have.
In too many situations, the management decides that a new strategy is required. One or more bright business leaders decide they need PLM (note -the strategy has now changed towards buying and implementing a system). Together with IT and after doing an extensive selection process, the selected PLM system (disconnected from the strategy) will be implemented.
I believe we read something about such a case recently
Moreover, this is the place where all PLM discussions come together:
- why PLM projects are difficult
- why it is unclear what PLM does.
PLM Vendors and Implementers are not connected anymore at this stage to the strategy or business. They implement technology and do what the customer project team tells them to do (or what they think is best for their business model).
Successful implementations are those where the business and management are actively involved during the whole process and the change. Involvement requires a significant contribution from their side, often delegated to business and change consultants.
PLM Implementations usually lead to a crisis at some moment in time, when the business is not leading, and the focus is on IT and User Acceptance. In the optimal situation, business is driving IT. However, in most cases, due to lack of time and priorities from the business people, they delegate this activity to IT and the implementation team. So here it is a matter of luck if they will be successful: how experienced is the team?
Will they implement a new business strategy or just automate and implement the way the customer worked before, but now in a digital manner? Do we blame the software when people do not change?
Some notes here: I believe the disconnect between management/PLM vendors and on the other side meanwhile, people in business has become more prominent, due to the digital transformation hype. The hype is moving faster than the organization. Second point: I will not talk about people change anymore – organizations can change – people can adapt within a specific range. It is up to the organization where to push the limits.
Back to fun
I would not be so passionate about PLM if it was boring. However looking back the fun and enthusiasm does not come from PLM. The fun comes from a pro-active business approach knowing that first the motivating the people and preparing the change are defined, before implementing PLM practices
I believe the future success for PLM technologies is when we know to speak and address real business value and only then use (PLM) technologies to solve them.
PLM becomes is a logical result not the start. And don´t underestimate: change is required. What do you think – is it a dream ?
????
This time a post that has been on the table already for a long time – the importance of having established processes, in particular with implementing PLM. By nature, most people hate processes as it might give the idea that their personal creativity is limited, where large organizations love processes as for them this is the way to guarantee a confident performance. So let’s have a more in-depth look.
Where processes shine
In a transactional world, processes can be implemented like algorithms, assuming the data to be processed has the right quality. That is why MRP (Material Requirement Planning) and ERP (Enterprise Resource Planning) don’t have the mindset of personal creativity. It is about optimized execution driven by financial and quality goals.
When I started my career in the early days of data management, before it was called PDM/PLM, I learned that there is a need for communication-related to product data. Terms are revisions, and versions started to pop-up combined with change processes. Some companies began to talk about configuration management.
Companies were not thinking PLM along the whole lifecycle. It was more PDM for engineering and ERP for manufacturing. Where PDM was ultimate a document-control environment, ERP was the execution engine relying on documented content, but not necessarily connected. Unfortunate this is still the case at many companies, and it has to do with the mindset. Traditionally a company’s performance has been measured based on financial reporting coming from the ERP system. Engineering was an unmanageable cost in the eyes of the manufacturing company’s management and ERP-software vendors.
In de middle of the nineties (previous century now ! ), I had a meeting with an ERP-country manager to discuss a potential partnership. The challenge was that he had no clue about the value and complementary need for PLM. Even after discussing with him the differences between iterative product development (with revisioning) and linear execution (on the released product), his statement was:
“Engineers are just resources that do not want to be managed, but we will get them”
Meanwhile, I can say this company has changed its strategy, giving PLM a space in their portfolio combined with excellent slides about what could be possible.
To conclude, for linear execution the meaning of processes is more or less close to algorithms and when there is no algorithm, the individual steps in place are predictable with their own KPIs.
Process certification
As I mentioned in the introduction, processes were established to guarantee a predictable outcome, in particular when it comes to quality. For that reason, in the previous century when globalization started companies were somehow forced to get ISO 900x certified. The idea behind these certifications was that a company had processes in place to guarantee an expected outcome and for when they failed, they would have procedures in place to fix these gaps. The reason companies were doing this because no social internet could name and shame bad companies. Having ISO 900x certification would be the guarantee to deliver quality. In the same perspective, we could see, configuration management, a system of best practices to guarantee that product information was always correct.
Certification was and is heaven for specialized external auditors and consultants. To get certification you needed to invest in people and time to describe your processes, and once these processes were defined, there were regular external audits to ensure the quality system has been followed. The beauty of this system – the described procedures were more or less “best intentions” not enforced. When the auditor would come the company had to play some theater that processes were followed., the auditor would find some improvements for next year and the management was happy certification was passed.
This has changed early this century. In particular, mid-market companies were no longer motivated to keep up this charade. The quality process manual remained as a source of inspiration, but external audits were no longer needed. Companies were globally connected and reviewed, so reputation could be sourced easily.
The result: there are documented quality procedures, and there is a reality. The more disconnected employees became in a company due to mergers or growth, the more individual best-practices became the way to deliver the right product and quality, combined with accepted errors and fixes downstream or later. The hidden cost of poor quality is still a secret within many companies. Talking with employees they all have examples where their company lost a lot of money due to quality mistakes. Yet in less regulated industries, there is no standard approach, like CAPA (Corrective And Preventive Actions), APQP or 8D to solve it.
Configuration Management and Change Management processes
When it comes to managing the exact definition of a product, either an already manufactured product or products that are currently made, there is a need for Configuration Management. Before there were PLM systems configuration management was done through procedures defining configurations based on references to documents with revisions and versions. In the aerospace industry, separate systems for configuration management were developed, to ensure the exact configuration of an aircraft could be retrieved at any time. Less regulated industries used a more document-based procedural approach as strict as possible. You can read about the history of configuration management and PLM in an earlier blog post: PLM and Configuration Management – a happy marriage?
With the introduction of PDM and PLM-systems, more and more companies wanted to implement their configuration management and in particular their change management inside the system, as the changes are always related to product information that can reside in a PLM-system. The change of part can be proposed (ECR), analyzed and approved, leading to and implementation of the change (ECO) which is based on changed specifications, designs (3D Models / Drawings) and more. You can read the basics here: The Issue and ECR/ECO for Dummies (Reprise)
The Challenge (= Problem) of Digital Processes
More and more companies are implementing change processes fully in PLM, and this is the point that creates the most friction for a PLM implementation. The beauty of digital change processes is that they can be full-proof. No change gets unnoticed as everyone is forced to follow the predefined procedures, either a type of fast track in case of lightweight (= low risk) changes or the full change process when the product is already in a mature state.
Like the ISO-900x processes, the PLM-implementer is often playing the role of the consultancy firm that needs to recommend the company how to implement configuration management and change processes. The challenge here is that the company most of the time does not have a standard view for their change processes and for sure the standard change management inside PLM s not identical to their processes.
Here the battle starts….
Management believes that digital change processes, preferable out-of-the-box, a crucial to implement, where users feel their job becomes more an administrative job than a creative job. Users that create information don’t want to be bothered with the decisions for numbering and revisioning.
They expect the system to do that easily for them – which does not happen as old procedures, responsibilities, and methodologies do not align with the system. Users are not measured or challenged for data quality, they are measured on the work they deliver that is needed now. Let’s first get the work done before we make sure all is consisted defined in the PLM-system.
Digital Transformation allows companies to redefine the responsibilities for users related to the data they produce. It is no longer a 3D Model or a drawing, but a complete data set with properties/attributes that can be shared and used for analysis and automation.
Conclusion
Implementing digital processes for PLM is the most painful, but required step for a successful implementation. As long as data and processes are not consistent, we can keep on dreaming about automation in PLM. Therefore, digital transformation inside PLM should focus on new methods and responsibilities to create a foundation for the future. Without an agreement on the digital processes there will be a growing inefficiency for the future.
Image: 21stcenturypublicservant.wordpress.com/
I have talked a lot the past years about Digital Transformation and in particular its relation to PLM. This time I want to focus a little more on Digital Transformation and my observations related to big enterprises and small and medium enterprises. I will take you starting from the top, the C-level to the work floor and then try to reconnect through the middle management. As you can imagine from the title of this post, there is a challenge. And I am aware I am generalizing for the sake of simplicity.
Starting from the C-level of a large enterprise
Large and traditional enterprises are having the most significant challenge when aiming at a digital transformation for several reasons:
- They have shareholders that prefer short-term benefits above long-term promising but unclear higher benefits. Shareholders most of the time have no personal interest in these companies, they just want to earn money above the average growth.
- The CEO is the person to define the strategy which has to come with a compelling vision to inspire the shareholders, the customers and the employees in the company – most of the time in that order of priority.
- The role of the CEO is to prioritize investments and stop or sell core components to make the transformation affordable. Every transformation is about deciding what to stop, what to start and what to maintain.
- After four to seven years (the seven years’ itch) it is time for a new CEO to create a new momentum as you cannot keep the excitement up too long.
- Meanwhile, the Stop-activities are creating fear within the organization – people start fearing their jobs and the start-activities are most of the time of such a small-scale that their successes are not yet seen. So at the work floor, there will be reservations about what’s next
Companies like ABB, Ericsson, GE, Philips – in alphabetical order – are all in several stages of their digital transformation and in particular I have followed GE as they were extremely visible and ambitious. Meanwhile, it is fair to say that the initial Digital Transformation plan from GE has stalled and a lot of lessons learned from that.
If you have time – read this article: The Only Way Manufacturers Can Survive – by Vijay Govindarajan & Jeff Immelt (you need to register). It gives useful insights about what the strategy and planning were for digital transformation. And note PLM is not even mentioned there J
Starting from the C-level of a small and medium enterprise
In a small or medium enterprise, the distance between the C-level and the work floor is most of the time much shorter and chances are that the CEO is a long-term company member in case of a long-standing family-owned business. In this type of companies, a long-term vision can exist and you could expect that digital transformation is more sustainable there.
Unfortunate most of the time it is not, as the C-level is often more active in current business strategies and capabilities close to their understanding instead of investing energy and time to digest the full impact of a digital transformation. These companies might invest in the buzz-words you hear in the market, IoT, Digital Twins and Augmented Reality/Virtual Reality, all very visionary topics, however of low value when they are implemented in an isolated way.
In this paragraph, I also need to mention the small and medium enterprises that are in the hands of an investment company. Here I feel sorry as the investment company is most of the time trying to optimize the current ways of working by simplifying or rationalizing the business, not creating a transformative vision (as they do not have the insights. In this type of companies, you will see on a lower scale the same investments done as in the other category of small and medium enterprises, be it on a lesser scale.
Do people need to change?
Often you hear that the problem with any change within the companies is because people do not want to change. I think this is too much a generalization. I have worked in the past five years with several companies where we explored the benefits and capabilities of PLM in a modern way, sometimes focusing on an item-centric approach, sometimes focusing on a model-based approach. In all these engagements there was no reluctance from the users to change.
However, there were two types of users in these discussions. I would characterize as evolutionary thinkers (most of the time ten years or more in the company) and love-to-change thinkers (most of them five years or less in the company). The difference between these groups was that the evolutionary thinkers were responding in the context of the existing business constraints where the love-to-change thinkers were not yet touched by the “knowledge how good everything was”.
For digital transformation, you need to create the love-to-change attitude while using the existing knowledge as a base to improve. And this is not a people change, it is an organizational change where you need to enable people to work in their best mode. It needs to be an end-to-end internal change – not changing the people, but changing the organizational parameters: KPIs, divisions, departments, priorities. Have a look at this short movie, you can replace the word ERP by PLM, and you will understand why I like this movie (and the relaxing sound)
The Middle Management dilemma
And here comes my last observation. At the C-level we can find inspiring visions often outcome-based, talking about a more agile company, closer to the customer, empowered workers, etc. Then there is the ongoing business that cannot be disrupted and needs to perform – so the business units, the departments all get their performance KPIs, merely keeping the status quo in place.
Also, new digital initiatives need to be introduced. They don’t fit in the existing business and are often started in separation – like GE Digital division, and you can read Jeff Immelt’ s thoughts and strategy how this could work. (The Only Way Manufacturers Can Survive). However as the majority of the business runs in the old mode, the Digital Business became another business silo in the organization, as the middle management could not be motivated to embed digital in their business (no KPIs or very low significance of new KPIs)
I talked about the hybrid/bimodal approach several times in my blog posts, most recently in The Challenges of a Connected Ecosystem. One of the points that I did not address was the fact that probably nobody wants to work in the old mode anymore once the new approach is successful and scaled up.
When the new mode of business is still small, people will not care so much and continue business as usual. Once the new mode becomes the most successful part of the company, people do want to join this success if they can. And here the change effort is needed. An interesting article in this context is The End of Two-Speed IT from the Boston Consultancy Group (2016). They already point at the critical role of middle management. Middle management can kill digital transformation or being part of it, by getting motivated and adopting too.
Conclusion
Perhaps too much text in this post and even more content when you dive more in-depth in the provided content. Crucial if you want to understand the digital transformation process in an existing company and the critical place of middle management. They are likely the killers of digital transformation if not give the right coaching and incentives. Just an observation – not a thought 😉
I was planning to complete the model-based series with a post related to the digital twin. However, I did not find the time to structure my thoughts to write it up in a structured story. Therefore, this time some topics I am working on that I would like to share.
Executive days at CADCAM Group
Last week I supported the executive days organized by the CADCAM Group in Ljubljana and Zagreb. The CADCAM is a large PLM Solution and Services Provider (60+ employees) in the region of South-East Europe with offices in Croatia, Slovenia, Serbia and Bosnia and Herzegovina. They are operating in a challenging region, four relative young countries with historically more an inside focus than a global focus. Many of CADCAM Group customers are in the automotive supply chain and to stay significant for the future they need to understand and develop a strategy that will help them to move forward.
My presentation was related to the learning path each company has to go through to understand the power of digital combined with the observation that current and future ways of working are not compatible therefore requiring a scaled and bimodal approach (see also PDT Europe further down this post).
This presentation matched nicely with Oscar Torres’s presentation related to strategy. You need to decide on the new things you are going to do, what to keep and what to stop. Sounds easy and of course the challenge is to define the what to start, stop and keep. There you need good insights into your current and future business.
Pierre Aumont completed the inspiring session by explaining how the automotive industry is being disrupted and it is not only Tesla. So many other companies are challenging the current status quo for the big automotive OEMs. Croatia has their innovator for electrical vehicles too, i.e. Rimac. Have a look here.
The presentations were followed by a (long) panel discussion. The common theme in both discussions is that companies need to educate and organize themselves to become educated for the future. New technologies, new ways of working need time and resources which small and medium enterprises often do not have. Therefore, universities, governments and interest groups are crucial.
A real challenge for countries that do not have an industrial innovation culture (yet).
CADCAM Group as a catalyst for these countries understands this need by organizing these executive days. Now the challenge is after these inspiring days to find the people and energy to follow-up.
Note: CADCAM Group graciously covered my expenses associated with my participation in these events but did not in any way influence the content of this paragraph.
The MBD/MBE discussion
In my earlier post, Model-Based: Connecting Engineering and Manufacturing, I went deeper into the MBD/MBE topic and its potential benefits, closing with the request to readers to add their experiences and/or comments to MBD/MBE. Luckily there was one comment from Paul van der Ree, who had challenging experiences with MBD in the Netherlands. Together with Paul and a MBD-advocate (to be named) I will try to have discussion analyzing pro’s and con’s from all viewpoints and hopefully come to a common conclusion.
This to avoid that proponents and opponents of MBD just repeat their viewpoints without trying to converge. Joe Brouwer is famous for his opposition to MBD. Is he right or is he wrong I cannot say as there has never been a discussion. Click on the above image to see Joe’s latest post yourself. I plan to come back with a blog post related to the pro’s and con’s
The Death of PLM Consultancy
Early this year Oleg Shilovitsky and I had a blog debate related to the “Death of PLM Consultancy”. The discussion started here: The Death of PLM Consultancy ? and a follow-up post was PLM Consultants are still alive and have an exit strategy. It could have been an ongoing blog discussion for month where the value would be to get response from readers from our blogs.
Therefore I was very happy that MarketKey, the organizers behind the PLMx conferences in Europe and the US, agreed on a recorded discussion session during PLMx 2018 in Hamburg. Paul Empringham was the moderator of this discussion with approx. 10 – 12 participants in the room to join the discussion. You can view the discussion here through this link: PLMx Hamburg debate
I want to thank MarketKey for their support and look forward to participating in their upcoming PLMx European event and if you cannot wait till next year, there is the upcoming PLMx conference in North America on November 5th and 6th – click on the image on the left to see the details.
PDT Europe call for papers
As you might have noticed I am a big supporter of the joint CIMdata/PDT Europe conference. This year the conference will be in Stuttgart on October 24th (PLM Roadmap) and October 25th (PDT).
I believe that this conference has a more “geeky” audience and goes into topics of PLM that require a good base understanding of what’s happening in the field. Not a conference for a newcomer in the world of PLM, more a conference for an experienced PLM person (inside a company or from the outside) that has experience challenging topics, like changing business processes, deciding on new standards, how to move to a modern digital business platform.
It was at these events where concepts as Model-Based were discussed in-depth, the need for Master Data Management, Industry standards for data exchange and two years ago the bimodal approach, also valid for PLM.
I hope to elaborate on experiences related to this bimodal or phased approach during the conference. If you or your company wants to contribute to this conference, please let the program committee know. There is already a good set of content planned. However, one or two inspiring presentations from the field are always welcome.
Click on this link to apply for your contribution
Conclusion
There is a lot on-going related to PLM as you can see. As I mentioned in the first topic it is about education and engagement. Be engaged and I am looking forward to your response and contribution in one or more of the topics discussed.
At the moment this post is published I have had time to digest the latest PLMx conference organized by MarketKey. See the agenda here. For me it was a conference with mixed feelings this time and I will share more details a little further on.
Networking during the conference was excellent, good quality of conversations, however the number of people attending was smaller than previous conferences, perhaps due to too much diversification in the PI conferences?
There were several inspiring sessions and as I participated in three sessions myself, I missed a lot of potential exciting sessions that were in parallel at the same time. I believe four parallel tracks is too much and downloading the presentations later does not give you the real story. Now some of the notable sessions I attended:
Building a Better Urban Mobility Future
The first keynote session was meant to inspire us and think of solving issues differently. Lewis Horne from a Swedish automotive startup explained their different approach to designing an electrical vehicle. Not based on classical paradigms – you do not need a steering wheel – you can navigate differently. And switching the indicator on when going left or right is now a swipe. Of course these were not the only differences.
Unity will not certify for the highest safety classes like other vehicles as car safety rules are a lot based on mechanical / human handling and responses. A fully computerized and full of sensors has complete different dynamics. And a light city car does not ride on the high-speed way. Based on the first prototype there are already more than 1000 pre-orders but Unity does not have a manufacturing facility. This will be franchised. Unity used the Apple mode – focus on an unmatched user-experience instead of manufacturability. Let’s see what happens when the first Unity’s start riding – current target prices 20.000 Euro. Will it be the new hype for modern citizens?
Focus on quality – not on happy engineers
Not only the title of this paragraph but also other statements were made by Hilmer Brunn, head of global PLM from Mettler-Toledo related to their PLM implementation strategy. As Hilmer stated:
We should not focus to give engineers more time to design only. The job of engineering is more comprehensive than just creating designs. Engineers also need to solve issues that are related to their design – not leave it to the others.
Another interesting statement:
As long as you do not connect simulation to your design in 3D, you are actually working with 3D as if you do it with 2D. The value of 3D is more than just representation of geometry.
And the last quote I want to share from Hilmer was again related to engineering.
Engineering should consider themselves as a service provider of information to the rest of the company, providing the full information associated with a design, instead of behaving like extreme, intelligent people who need more resources to translate and complete their work.
Grand statements although during Q&A it became clear that also Mettler-Toledo did not have the magic bullet to get an organization work integrated.
Working towards a Model-Based Enterprise with PLM
I consider Model-Based practices as one of the essential needs for future PLM as this approach reduces the amount of derived information related to a product/ system. And it provides a digital continuity. In the last PDT conference in Gothenburg this topic was shared on a quit extensive matter. Have a read to fresh-up your memory here: The weekend after PDT Europe – part 1 and part 2
The focus group which I moderated was with approximate 20 attendees and the majority was looking for getting a better understanding what model-based would mean for their organization. Therefore, the discussion was at the end more around areas where a few persons had the experience while others still tried to grasp the concepts. For me a point to take action related to education and in future posts I will go deeper into the basics.
PLMPulse Survey results and panel discussion
Nick Leeder presented the context of the PLMPulse survey and the results in a precise manner, where perhaps the result was not that surprising to the audience as many of us are involved in PLM. Two recurring points: PLM is still considered as an engineering tool and: The value related to PLM is most of the time not clear. You can register and download the full report from here.
Next Nick lead a panel discussion where people from the audience could participate. And here we got into a negative spiral where it became an inward-looking discussion why PLM has never been able to show the value and get out of the engineering domain. It was a someone said like an anonymous PLM meeting where members stood up and confessed they were also part of the group that could not change this behavior.
Was it the time of the day? Was it the mood of the audience? Too much old experiences? I believe it has to do with the fact that in PLM projects and conferences we focus too much on what we do and how we do things, not connecting it to tangible benefits that are recognized at the board level. And we will see an example later.
Solar Stratos
The food and drinks at the end of day 1 probably washed away the PLMPulse feedback session and Raphael Domjan inspired us with his SolarStratos project – a mission to develop a plane that can fly on solar energy on the heights of the stratosphere. Raphael is working hard with a team now to get there.
Designing an airplane, more a glider, that can take off en reach the stratosphere on solar energy requires solving a combination of so many different challenges. The first test flight reached an altitude of 500 m, but you can imagine challenges with the stratosphere – lack of oxygen / air pressure need to be solved. Raphael is looking for funding and you can find more details here. Back to the relative easy PLM challenges
The future of PLM Consultancy
Together with Oleg Shilovitsky we had a discussion related to the ways PLM could be realized in different manners thanks to changing technology. The dialogue started through our blogs – read it here. In this session there was a good dialogue with the audience and MarketKey promised to share the video recording of this session soon. Stay tuned to Oleg’s blog or my blog and you can watch it.
PLM in the context of digitization
This was my main personal contribution to the conference. Sharing insights why we have to approach PLM in a different manner. Not the classical linear engineering approach but as a mix of system of record and system of engagement. You can see the full presentation on SlideShare here.
My main conclusions are that PLM consultants / experts focus too much on what and how they do PLM, where the connection to WHY is missing. (See also my post PLM WHY?).
In addition I defended the statement that old and new PLM are incompatible and therefore you need to accept they will exist both in your organization. For a while or for a long time, depending on your product lifecycle. In order to reduce the gap between old and new PLM, there is a need for data governance, model-based ways of working, which allow the company to connect at some stages the old/record data and the new data. And don’t do pilots anymore experimenting new ways of working and then stop because the next step seems to be overwhelming. Start your projects in small, multidisciplinary teams and make them real. The only way to be faster in the future.
PLM in Manufacturing as Backbone of the Smart Factory
Susanne Lauda, Director, Global Advanced Manufacturing Technology, AGCO Corporation provided an overview related to AGCO’s new PLM journey and how they were benefiting from a digital thread towards manufacturing. It felt like a smooth vendor demo as everything looked nice and reasonable. It was all about the WHAT. However two points that brought the extra:
When moving to the new system the tried to bring in the data from an existing product into then new system. According to Susanne a waste of time as the data required so much rework – there was no real value added for that. This confirms again my statement that old and new PLM are incompatible and one should not try to unify everything again in one system.
Second, I got excited at the end when we discussed the WHY for PLM and the business value of PLM. Here Suzanne mentioned PLM started as a “must-do strategic” project. PLM lead to a reduction of time to market with almost 50 %. Suzanne did not give exact number, but you can imagine I have heard these numbers from other companies too. Why aren’t we able to connect these benefits in the mindset of the management to PLM ? Perhaps still too much engineering focused.
Next Susanne explained that they investigated the cost for quality for their manufacturing plants. What if something was produced wrong, the wrong parts were ordered, the delays to fix it, the changes needed to be made on the shop floor? These results were so high that people were even afraid to report them. This is the case at many companies I worked with – even their PLM consultants do not receive these numbers – you just have to imagine they are big.
At AGCO they were able to reduce the cost for quality in a significant manner and Susanne explain that PLM was a main contributor to that success. However, success always has many fathers – so if your PLM team does not claim loud (and we are modest people not used to talk finance) – the success will not be recognized.
PLM’s Place Within an Enterprise Application Architecture
Peter Bilello from CIMData in the closing keynote speech gave an excellent summary and overview of where and which capabilities fit in an enterprise architecture and the positioning of a product innovation platform. A blueprint that can be used for companies to grasp the holistic view before jumping into the details of the tools.
Conclusion
PLMx Hamburg 2018 was an event with valuable highlights for me and potential I missed several more due to the fact of parallel streams. I hope to catch-up with these sessions in the upcoming month and share interesting thoughts that I discover with you. What remains crucial I believe for all vendor-neutral events is to find new blood. New companies, new experiences that are focused on the future of PLM and connect to the WHY or the WHAT WE LEARNED values.
In my earlier post; PLM 2018 my focus, your input, I invited you to send PLM related questions that would spark of a dialogue. As by coincidence Oleg Shilovitsky wrote a post with the catchy title: Why traditional PLM ranking is dead. PLM ranking 2.0. Read this post and the comments if you want to follow this dialogue.
Oleg reacts in this post on the discussion that had started around the Forester Wave ranking PLM Vendors, which on its own is a challenging topic. I know from my experience that these rankings depend very much on a mix of functions and features, but also are profoundly influenced by the slideware and marketing power of these PLM Vendors. Oleg also quotes Joe Barkai’s post: ranking PLM Vendors to illustrate that this kind of ranking does not bring a lot of value as there is so much commonality between these systems.
I agree with Oleg and Joe. PLM ranking does not make sense for companies to select a PLM solution. They are more an internal PLM show, useful for the organizing consultancy companies to conduct, but at the end, it is a discussion about who has the biggest and most effective button. Companies need to sell themselves and differentiate.
Do we need consultancy?
We started a dialogue on the comments of Oleg’s blog post where I mentioned that PLM is not about selecting a solution from a vendor, there are many other facets related to a PLM implementation. First of all, the industry your company is active in. No solution fits all industries.
But before selecting a solution, you first need to understand what does a company want to achieve in the future. What is the business strategy and how can PLM support this business strategy?
In most ca
ses, a strategy is future-oriented and not about consolidating the current status quo. Therefore I believe a PLM implementation is always done in the context of a business transformation, which is most of the time not only related to PLM – it is about People, Processes and then the tools.
Oleg suggests that this complexity is created by the consulting business, as he writes:
Complex business and product strategies are good for consulting business you do. High level of complexity with high risk of failure for expensive PLM projects is a perfect business environment to sell consulting. First create complexity and then hire consulting people to explain how to organize processes and build business and product strategy. Win-win
Enterprise and engineering IT are hiring consulting to cover their decision process. That was a great point made by Joe Barkai- companies are buying roadmaps and long-term commitments, but rarely technologies. Technologies can be developed, and if even something is missed, you can always acquire independent vendors or technology later – it was done many times by many large ISVs in the past.
Here I agree with a part of the comments. If you hire consultancy firms just for the decision process, it does not make sense/ The decision process needs to be owned by the company. Do not let a consultancy company prescribe your (PLM) strategy as there might be mixed interests. However, when it comes to technologies, they are derived from the people and process needs.
So when I write in the comment:
We will not change the current status quo and ranking processes very soon. Technology is an enabler, but you need a top-down push to work different (at least for those organizations that read vendor rankings).
Oleg states:
However, the favorite part of your comments is this – “We will not change the current status quo and ranking processes very soon.” Who are “we”???? Management consulting people?
With “we” I do not mean the consulting people. In general, the management of companies is more conservative than consultants are. It is our human brain that is change averse and pushes people to stay in a kind of mainstream mode. In that context, the McKinsey article: How biases, politics, and egos derail business decisions is a fascinating read about company dynamics. Also, CIMdata published in the past a slide illustrating the gap between vision, real capabilities and where companies really are aiming at.
There is such a big gap between where companies are and what it possible. Software vendors describe the ideal world but do not have a migration path. One of the uncomfortable discussions is when discussing a cloud solution is not necessary security (topic #1) but what is your exit strategy? Have you ever thought about your data in a cloud solution and the vendor raises prices or does no longer have a viable business model. These are discussions that need to take place too.
Oleg also quotes a CIMdata cloud PLM research how companies are looking for solutions as they are “empowered” by the digital world. Oleg states:
In a digital world, companies are checking websites, technologies, watching YouTube and tried products available online. Recent cloud PLM research published by CIMdata tells that when companies are thinking about cloud PLM, the first check they do is independent software providers recommendations and websites (not business process consultants).
I am wondering the value of this graph. The first choice is independent software recommendations/websites. Have you ever seen independent software recommendations?
Yes, when it comes to consumer tools. “I like software A because it gives me the freedom what to do” or “Software B has so many features for such a low price – great price/value ratio.”
These are the kind of reviews you find on the internet for consumers. Don’t try to find answers on a vendor website as there you will get no details, only the marketing messages.
I understand that software vendors, including Oleg’s company OpenBOM, needs to differentiate by explaining that the others are too complex. It is the same message you hear from all the relative PLM newcomers, Aras, Autodesk, …….
All these newcomers provide marketing stories and claim successes because of their tools, where reality is the tool is secondary to the success. First, you need the company to have a vision and a culture that matches this tool. Look at an old Gartner picture (the hockey stick projection) when all is aligned. The impact of the tool is minimal.
Conclusion
Despite democratization of information, PLM transformations will still need consultants or a well-educated workforce inside your company. Consultants have the advantage of collected experience, which often is not the case when you work inside a company. We should all agree that at the end it is about the business first (human beings are complex) and then the tools (here you can shop on the internet what matches the vision)
Although this post seems like ping-pong match of arguments, I challenge you to take part of this discussion. Tell us where you agree or disagree combined with argumentation as we should realize the argumentation is the most valuable point.
Your thoughts?
Potential digital transformation is everywhere. This time I want to share a personal story based on my IoT cycling device from Garmin. Several years ago I became an enthusiastic cyclist, mainly because it clears your mind and cycling keeps you in good shape after enjoying customer visits with great dinners and excellent breakfasts. As the Dutch lack real mountains, we challenge ourselves with through open fields with strong winds to suffer a little too.
Four years ago, started tracking my cycling performance, with a Garmin Edge 810. The story of my Garmin is a real IoT story. GPS trackers, in the beginning, did not communicate with the outside world. Now, this device connects to sensors registering my speed, my location, my heart rate, pedal cadence and produced power at any time, finally uploading it to the Garmin Connect platform.
The IoT platform
The Garmin Connect platform gives me insights on my performance, activities, and segments. The segment demonstrates the social part of the platform. Here you can see how you rank with others who have cycled the same track segment over time. And you can register your own preferred segment too, where you challenge yourself and others in your area. So the number of segments is growing continuously. Imagine all these cyclists around the world virtually sharing and taking the same track. I am curious to learn from Garmin how many people are connected to the platform.
I could not find these numbers. You?
The fun of segments
Digital Twin
Through the platform, Garmin collects huge amounts of data of connected users. Each data set of the connected user could be considered a simple digital twin. The Connect platform provides me insights about my overall performance through the years through various reports. Garmin could offer as a (paid) service to deliver insights of my performance compared to other users and propose predictive enhancements similar to the GE Predix platform. The difference of course that 1 % performance improvement for me in cycling does not bring the same value as 1 % performance improvement of a GE product (turbine, jet engine, train, …). However, the concept is the same and GE is promoting themselves as the next Digital Industrial Company, leading in digital transformation. Read more here.
Digital Twin performance
Connecting to the customer
Tthe change from moving from a document-driven approach towards a data-driven approach to collect and store information is not the main concept behind a digital transformation. The data-driven approach is an enabler to connect directly to the customer and change the current business model from delivering products into a business model delivering services or even more advanced delivering experiences. Services and experiences create a closer relation to the customer, more loyalty, but also the challenge that you need to connect to the customer in such a way that the customer sees value. Otherwise, the customer will switch to another service or experience. The Apple, Nespresso, Uber experiences are all known for their new ways of connecting to the customer, differentiating from traditional product sales. Garmin could also be on that list. However, I discovered they are not there yet, despite an IoT-platform and connected devices. What is missing?
Why Garmin is not a digital enterprise.
Two years ago my Garmin Edge started crashing in the middle of a ride. The system rebooted after some minutes, and the recordings were lost or at least unreadable. When I contacted Garmin support their standard response was: “Please reset the device and update to the latest software.” Two years ago the software had still bug fixes. After two years you would expect a stable experience.
However, a year ago the problems started to become more frequent. I started to send log files illustrating where the error occurred. Still, the Garmin response was the same: “Please reset the device and update to the latest software.”
However as there were no new software updates, there must be another reason why the device failed more and more.
After pushing for a resolution, the service department concluded I needed a new device. There might be an issue with the hardware. A little bit skeptical I agreed on a hardware switch again, and as expected this did not solve the crashes. My guess is that due to the increasing amount of segments at some places, the software gets confused where the rider is exactly located and in which direction the rider is going. These are the moments when the crash happens, and this is probably a software issue.
Still, the Garmin help desk believes there is a hardware problem (preferably swap the device) where I kept on providing evidence data of crashes to support Garmin in their error-discovery. Till now there is no resolution. The good news is that Garmin support mentioned investigating further.
For me, the interaction with Garmin illustrates that the company internally is not yet digital transformed. The service desk probably has KPIs (Key Performance Indicators) related to their response time and problem resolution time. Although I can debate the response time, it is clear that the problem resolution approach: Update to the latest software and if this does not work swap to a new device is not increasing the knowledge from Garmin as a company what their customers are experiencing.
Apparently, their software management is disconnected from the service department and customers. Only clear bugs during the first launch are fixed. Next, it is a disconnected world again.
A must for a digital enterprise is to dive into customer issues and to connect them back to R&D, both for the hardware part and software part. Something a modern product manager would do. If a company is not able to understand the multidisciplinary dependencies and solve issues from the field (with some effort), they will keep on making the same mistakes again with new product launches and lose customers who are looking for a better experience.
My conclusion
PLM should be part of the digital enterprise too as this is the only way to deliver consistent customer value and positive experience. It requires companies to break down silos and create multidisciplinary teams that are capable of supporting the full customer journey. A digital device and a digital customer platform are just facades to the outside world – the inside needs to change too.
What do you think?
Does your company understand the challenges to transform across all disciplines?
Are you managing PLM, ALM, and IoT in context of the product and across the whole lifecycle?
I am curious !
Jos Voskuil's Weblog 
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