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The problem with a TLA is that there is a limited number of combinations that make sense. And even once you have found the right meaning for a TLA, like PLM you discover so many different interpretations.
For PLM I wrote about this in my post PLM misconceptions –: PLM = PLM ?
I can imagine an (un)certain person, who wants to learn about PLM, might get confused (and should be – if you take it too serious).
At the end your company’s goal should be how to drive innovation, increase profitability and competiveness and not about how it is labeled.
As a frequent reader of my blog, you might have noticed I wrote sometimes about ALM and here a similar confusion might exist as there are three ALMs that might be considered in the context I am blogging.
Therefore this post to clarify which ALM I am dedicated to.
So first I start with the other ALMs:
ALM = Application Lifecycle Management
This is an upcoming discipline in the scope of PLM due to the fact that more and more in the product development world embedded software becomes a part of the product. And like in PLM where we want to manage the product data through its lifecycle, ALM should become a logical part of a modern PLM implementation. Currently most of the ALM applications in this context are isolated systems dealing only with the software lifecycle, see this Wiki Page
ALM = Asset Lifecycle Management (operational)
In 2009 I started to focus on (my type of) ALM, called Asset Lifecycle Management, and I discovered the same confusion as when you talk about a BOM. What BOM really means is only clear when you understand the context. Engineers will usually think of an Engineering BOM, representing product as specified by engineering (managed by PDM). Usually the rest of the organization will imagine the Manufacturing BOM, representing the product the way it will be produced (managed mostly in ERP).
The same is valid for ALM. The majority of people in a production facility, plant or managed infrastructure will consider ALM as the way to optimize the lifecycle of assets. This means optimizing the execution of the plant, when to service or replace an asset ? What types of MRO activities to perform. Sounds a lot like ERP and as it has direct measurable impact on finance, it is the area that gets most of the attention by the management.
ALM = Asset Lifecycle Management (information management)
Here we talk about the information management of assets. When you maintain your assets only in a MRO system, it is similar like in a manufacturing company when only using an ERP system. You have the data for operations, but you do not have the process in place to manage the change and quality of data. In the manufacturing world this is done in PDM and PLM system and I believe owners/operators of plant can learn from that.
I wrote a few posts about this topic, see Asset Lifecycle Management using a PLM system, PLM CM and ALM – not sexy or using a PLM system for Asset Lifecycle Management requires a vision and I am not going to rewrite them in this post. So get familiar with my thoughts if you read the first time about ALM in my blog.
What I wanted to share is that thanks to modern PLM systems, IT infrastructure/technologies and SBA it becomes achievable for owner/operators to implement an Asset Lifecycle Management vision for their asset information and I am happy to confirm that in my prospect and customer base, I see companies investing and building this ALM vision.
And why do they do this:
Reduce maintenance time (incidental and planned) by days or weeks due to the fact that people have been working with the right and complete data. Depending on the type of operations, one week less maintenance can bring millions (power generation, high demand/high cost chemicals and more)
.
Reduce the failure costs dramatically. As maintenance is often a multi-disciplinary activity errors due to miscommunication are considered as normal in this industry (10 % up and even more). It is exactly this multi-disciplinary coordination that PLM systems can bring to this world. And the more you can do in a virtual world the more you can assure you do the right thing during real maintenance activities. Here industries similar as for the previous bullet, but also industries where high-costly materials and resources are used, the impact on reducing failure costs is high.
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Improve the quality of data. Often the MRO system contains a lot of operational parameters that were entered there at a certain time by a certain person with certain skills – the fact that although I used the word certain three times, the result is uncertainty as there is no separate tracing and validation of the parameters per discipline and an uncertain person looking at the data might not discover there is an error, till it goes wrong. Here industries where a human error can be dramatic benefit the most from it (nuclear, complex chemical processes)
Conclusion: The PLM system based ALM implementations are more and more becoming reality next to the ALM operational world. After spending more then three years focused on this area, I believe we can see and learn from the first results.
Are you interested in more details or do you want to share your experience ? Please let me know and I will be happy to extend the discussion
Note: On purpose I used as much TLA’s to assure it looks like an specialist blog, but you can always follow the hyperlink to the wiki explanation, when the TLA occurs the first time.
Sorry for the provoking title in a PLM blog, but otherwise you would not read my post till the end.
In the past months I have been working closely with several large companies (not having a mid-market profile). And although they were all in different industries and have different business strategies, they still had these common questions and remarks:
- How to handle more and more digital data and use it as valuable information inside the company or for their customers / consumers ?
- What to do with legacy data (approved in the previous century) and legacy people (matured and graduated in the previous century) preventing them to change ?
- We are dreaming of a new future, where information is always up-to-date and easy to access – will this ever happen ?
- They are in the automotive industry, manufacturing industry, infrastructure development and maintenance, plant engineering, construction and plant maintenance
- They all want data to be managed with (almost) zero effort
- And please, no revolution or change for the company
Although I have been focusing on the mid-market, it is these bigger enterprises that introduce new trends and as you can see from the observations above, there is a need for a change. But also it looks like the demands are in a contradiction to each other.
I believe it is just about changing the game.
If you look at the picture to the left, you see one of the contradictions that lead to PLM.
Increasing product quality, reducing time to market and meanwhile reducing costs seemed to be a contradiction at that time too.
Change ?
Although PLM has not been implemented (yet) in every company that could benefit from it, it looks like the bigger enterprises are looking for more.
the P from PLM becomes vague – it is no longer only the product that has the focus, it is also the whole context around the product that might influence it, that they want to take in consideration
the L from PLM remains – they still want to connect all information that is related to the lifecycle of their products or plants.
the M from Management has a bad association – companies believe that moving from their current state towards a managed environment of data is a burden. Too much overhead is the excuse to not manage dat. And their existing environments to manage data do not excel in user-friendliness. And therefore people jump towards using Excel.
Next
So if the P is not longer relevant, the M is a burden, what remains of PLM ?
Early June I presented at the Dassault Systems 3DExperience forum the topic of digital Asset Lifecycle Management for owners / operators. One of the areas where I believe PLM systems can contribute a lot to increase business value and profitability (quality and revenue – see using a PLM system for Asset Lifecycle Management )
Attending the key note speech it was clear that Dassault Systems does not talk about PLM anymore as a vision. Their future dream is a (3D) lifelike experience of the virtual world. And based on that virtual model, implement the best solution based on various parameters: revenue, sustainability, safety and more. By trying to manage the virtual world you have the option to avoid real costly prototypes or damaging mistakes.
I believe it is an ambitious dream but it fits in the above observations. There is more beyond PLM.
In addition I learned from talking with my peers (the corridor meetings) that also Siemens and PTC are moving towards a more industry or process oriented approach, trying to avoid the association with the generic PLM label.
Just at the time that Autodesk and the mid-market started to endorse PLM, the big three are moving away from this acronym.
This reminds me of what happened in the eighties when 3D CAD was introduced. At the time the mid-market was able to move to mainstream 3D (price / performance ratio changed dramatically) the major enterprises started to focus on PDM and PLM. So it is logical that the mid-market is 10 – 15 years behind new developments – they cannot afford experiments with new trends.
So let’s see what are the new trends:
- the management of structured and unstructured data as a single platform. We see the rise of Search Bases Application and business intelligence based on search and semantic algorithms. Using these capabilities integrated with a structured (PLM ? ) environment is the next big thing.
- Apps instead of generic applications that support many roles. The generic applications introduce such a complexity to the interface that they become hard to use by a casual user. Most enterprise systems, but also advanced CAD or simulation tools with thousands of options suffer from this complexity. Would not it be nice if you only had to work with a few dedicated apps as we do in our private life ?
- Dashboards (BI) that can be created on the
fly
representing actual data and trends based
on structured and unstructured data.
It reminded me of a PLM / ERP discussion I had with a company, where the general manager all the time stated the types of dashboards he wanted to see. He did not talk about PLM, ERP or other systems – he wanted the on-line visibility - Cloud services are coming. Not necessary centralizing all data on the cloud to reduce it cost. But look at SIRE and other cloud services that support a user with data and remote processing power at the moment required.
- Visual navigation through a light 3D Model providing information when required. This trend is not so recent but so far not integrated with other disciplines, the Google maps approach for 3D.
So how likely are these trends to change enterprise systems like PLM, ERP or CRM. In the table below I indicated where it could apply:
As you can see the PLM row has all the reasons to introduce new technologies and change the paradigm. For that reason combined with the observations I mentioned in the beginning, I am sure there is a new TLA (Three Letter Acronym) upcoming.
The good news is that PLM is dynamic and on the move. The bad news for potential PLM users is that the confusion remains – too many different PLM definitions and approaches currently – so what will be the next thing after PLM ?
Conclusion: The acronym PLM is not dead and becomes mainstream. On the high-end there is for sure a trend to a wider and different perspective of what was initially called PLM. After EDM, TDM, PDM and PLM we are waiting for the next TLA
May 24th, 2008 was the date I posted my first blog post as a Virtual Dutchman aiming to share PLM related topics for the mid-market.
I tried to stay away from technology and function/feature debates and based on my day to day observations, describe the human side of the PLM – what people do and why . All from a personal perspective and always open to discuss and learn more.
Looking back and reviewing my 86 posts and 233 comments so far, I would like to share a summary around some of the main topics in my blog.
PLM
In 2008, PLM awareness was much lower – at that time one of the reasons for me to start blogging. There was still a need to explain that PLM was a business strategy needed beside ERP and PDM.
PLM will bring more efficiency, and in better quality, new innovative products to the market due to better collaboration between teams and departments.
At that time the big three, Dassault Systemes, Siemens and PTC were all offering a very CAD-centric, complex approach for PLM. There was no real mid-market offering, although their marketing organizations tried to sell as-if a mid-marketing offering existed. Express, Velocity, ProductPoint where are these offerings now ?
Now, In 2012 there is an established PLM awareness as everyone is talking about (their interpretation of) PLM and with Autodesk, a company that knows how to serve the mid-market, also acknowledged there is a need for PLM in their customer base, the term PLM is widespread
The new PLM providers focus on a disconnect between PDM and PLM, as in particular the handling of enterprise data outside the PDM scope is a white space for many mid-market companies that need to operate on a global platform.
PLM & ERP
In the relation between PLM and ERP, I haven’t seen a big change the past four years. The two dominating ERP originated vendors, SAP and Oracle were paying attention to PLM in 2008 in their marketing and portfolio approach.
However their PLM offerings in my perception, haven’t moved much forward. SAP is selling ERP and yes there is a PLM module and Oracle is having PLM systems, but I haven’t seen a real targeted PLM campaign explaining the needs and value of PLM integrated with ERP.
Historically ERP is the main IT-system and gets all the management attention. PLM is more considered something for engineering (and gets less focus and budget). Understanding PLM and how it connects to ERP remains a point of attention and the crucial point of interaction is the manufacturing BOM and the place where it is defined. The two most read posts from my blog are: Where is the MBOM and next Bill of Materials for Dummies – ETO, indicating there is a lot of discussion around this topic.
I am happy to announce here that in October this year during PLM Innovation US, I will present and share my thoughts in more detail with the audience, hoping for good discussions
New trends
There are three new trends that became more clear the past four years.
The first one to mention is the upcoming of Search Based Applications (SBA). Where PLM systems require structured and controlled data, search based applications assist the user by “discovering” data anywhere in the organization, often in legacy systems or possible in modern communication tools.
I believe companies that develop an integrated concept of PLM and SBA can benefit the most. PLM and ERP vendors should think about combining these two approaches in an integrated offering. I wrote about this combined topic in my post: Social Media and PLM explained for Dummies
The second trend is the cloud. Where two-three years ago social media combined with PLM was the hype as a must for product innovation and collaboration, currently cloud is in focus.
Mainly driven and coming for the US, where the big marketing engine from Autodesk is making sure it is on the agenda of mid-market companies.
In Europe there is less a hype at this moment, different countries and many languages to support plus discussions around security take the overhand here.
For me a cloud solution for sure is lowering the threshold for mid-market companies to start implementing PLM. However how to make the change in your company ? It is not only an IT-offering. Like a similar discussion around Open Source PLM, there is still a need to provide the knowledge and change push inside a company to implement PLM correct. Who will provide these skills ?
The third trend is the applicability of PLM systems outside the classical manufacturing industries.
I have been writing about the usage of PLM systems for Owner/Operators and the civil / construction industry, where the PLM system becomes the place to store all plant related information, connected to assets and with status handling. Currently I am participating in several projects in these new areas and the results are promising
People and Change
I believe PLM requires a change in an organization not only from the IT perspective but more important from the way people will work in an organization and the new processes they require.
The change is in sharing information, making it visible and useful for others in order to be more efficient and better informed to make the right decisions much faster.
This is a global trend and you cannot stay away from it. Keeping data locked in your reach might provide job security but in the long term it kills all jobs in the company as competiveness is gone.
The major task here lies with the management that should be able to understand and execute a vision that is beyond their comfort zone. I wrote about this topic in my series around PLM 2.0
Modern companies with a new generation of workers will have less challenges with this change and I will try to support the change with arguments and experiences from the field.
Audience
Since February this year, WordPress provides much more statistics and interesting is the map below indicating in which countries my blog is read. As you can see there are only a few places left on earth where PLM is not studied. Good news !!
Although most of my observations come from working in Europe, it is the US that provides the most readers (30 %) , followed by India (9 %) and on the third place the UK (6 %).
This might be related to the fact that I write my blog in English (not in 100 % native English as someone commented once).
It makes me look forward to be in October in Atlanta during the PLM Innovation US conference to meet face to face with many of my blog readers and share experiences.
Conclusion
Reading back my posts since 2008, it demonstrated for me that the world of PLM is not a static environment. It is even that dynamic that some of the posts I wrote in the early days have become obsolete.
At the end of 2008 I predicted the future of PLM in 2050 – here we are on the right track.
There is still enough blogging to do without falling into repetitions and I am looking forward to your opinion, feedback and topics to discuss.
Related articles
- PLM misconceptions (virtualdutchman.com)
The trigger for this post is based was a discussion I had around the Autodesk 360 cloud based PLM solution. To position this solution and to simplify the message for my conversation partner Joe the plumber, I told him”: “You can compare the solution with Excel on-line. As many small mid-market companies are running around with metadata (no CAD files) in Excel, the simplified game changer with this cloud based PLM offering is that the metadata is now in the cloud, much easier to access and only a single version exists.”
(sorry for Autodesk, if I simplified it too much, but sometimes your conversation partner does not have an IT background as they are plumbers)
Interesting enough Joe said: “But what is the difference with Google docs or SharePoint where I can centralize my Excel files too – and Google Docs is like a cloud solution, right ?”
He was right and I had to go more in-depth to explain difference. This part of the conversation was similar to discussions I had in some meetings with owner / operators in the civil and energy sector, discussing the benefits of PLM practices for their industry.
I wrote about this in previous posts:
Using a PLM system for asset lifecycle management requires a vision
PLM practices for the engineering / construction industry
The trouble with dumb documents
Here it was even more a key point of the discussion that most of the legacy data is stored in dumb documents. And the main reason dumb documents are used is because the data needs to be available during the long lifecycle of the the plant, application independent if possible. So in the previous century this was paper, later scanned documents (TIFF – PDF) and currently mainly PDF. Most of the data now is digital but where is the intelligence ?
The challenges these companies have is that despite the fact information is now stored in a digital file, the next step is how to deal with the information in an intelligent manner. A document or an Excel file is a collection of information, you might call it knowledge, but to get access to the knowledge you need to find it.
Did you try to find a specific document in Google docs or SharePoint ? The conclusion will be the file name becomes very important, and perhaps some keywords ?
Is search the solution ?
To overcome this problem, full text search and search based applications were developed, that allow us to index and search inside the documents. A piece of cake for Google and a niche for others to index not only standard documents but also more technical data (drawings, scans from P&ID, etc, etc).
Does this solve the problem ?
Partly, as suddenly the user finds a lot more data. Search on Google for the words “Right data” and you have 3.760.000.000 hits (or more). But what is the right data ? The user can only decide what is the right data by understanding the context.
- Is it the latest version ?
- Is it reflecting the change we made at that functional position ?
- What has changed ?
And here comes the need for more intelligent data. And this is typically where a PLM system provides the answer.
A PLM systems is able to manage different types of information, not only documents. In the context of a plant or a building, the PLM system would also contain:
- a functional definition / structure (linked to its requirements)
- a logical definition / structure (how is it supposed to be ?)
- a physical definition / structure (what is physically there ?)
- a location definition / structure (where in the plant / building ?)
and this is all version managed and related to the supported documents and other types of information. This brings context to the documents and therefore it exposes knowledge.
As there is no automatic switch from dumb documents towards intelligent data, it will be a gradual process to move towards this vision. I see a major role for search based applications to support data discovery. Find a lot of information, but than have the capability to capture the result (or generate a digest of the result) and store it connected to your PLM system, where is it managed in the future and provides the context.
Conclusion: We understand that paper documents are out of time. Moving these documents to digital files stored in a central location, either in SharePoint or a cloud-based storage location is a step we will regret in ten years from now, as intelligent data is not only inside the digital files but also depending on its context.
Since the past six months I am involved in several discussions related to the (building) construction industry. If you look to this industry, it seems like this is one of the few industries without innovation in its processes.
Someone in the discussion even claimed that if a worker from the middle ages would come back to this century, he would be quickly adapt and understand the way people work. OK, there are some new tools and materials, but the way the building construction industry works has not changed.
And let’s look to productivity. Where in the past 60 years in all industries productivity has increased, I have seen a survey where productivity in this industry has not increased and even decreased a little.
Although the survey ends in 2003, another article caught my attention. Robert Prieto, Senior Vice President from Fluor Corporation wrote end of last year in Engineering News Record his viewpoint: Engineering-Construction Needs a New Model. Reading this article and the comments demonstrates there is a need for innovation in the building construction industry.
Failure costs up to 15 % and delayed deliveries are considered normal business in this industry, where if this would be applied to mid-market companies in the manufacturing industry, they would have gone bankrupt due to claims and lost profit.
If we look at this industry, the first excuse you hear is that every project is unique and that project execution is done by a group of loose connected suppliers, not really pushed to stay within the targeted budget. But you might ask yourself: what is the correct budget?
I noticed that in this industry when a project is estimated, suppliers are asked to deliver their bid and proposed solution based on their understanding. Usually the lowest bid wins the bid.
All participants are aware that not all requirements are clear, but no one wants to ask and invest further as to invest more in accurate cost estimation. This is not anticipated. It is about winning the bid with the lowest trouble and investment.
So who is to blame? First of all, the client who has a short term vision. By selecting the lowest bids and not pushing for in-depth analysis of the project delivery and operational costs in the long term, the situation will not change.
What if the client was using the basics of PLM – Product Lifecycle Management? For me PLM means a connection and sharing of the concept phase, the delivery phase, production phase and maintenance phase.
What I consider as strange is the fact that in the engineering and construction industry these four phases are not connected and often that the maintenance phase (operations) is not taken into account during the concept phase.
And then there is the data handover. After engineering and construction specific data is handed over to the maintenance organization. What is the quality of the data, how applicable is it to the maintenance organization and how does it support maintenance is not clear. There is a disconnect and loss of knowledge as the handover is just based on the minimum data required.
What if the engineering construction industry would use PLM best practices, like:
- Requirements Management – connecting, implementing and validating all the requirements from each stakeholder. Making sure all requirements are considered and negotiated in a structured manner – no excuse for surprises.
- Data sharing with versions and status. Instead of a handover, data becomes mature during the lifecycle of the project. It requires the maintenance organization to be involved from the start
- Standardized validation and approval processes related to requirements and data. These processes might be considered as an overhead but they are the ones that lead to quality, risk and cost management
Conclusion: I believe connecting the engineering and maintenance phase for engineering construction companies will lead to higher productivity and quality. For sure the initial engineering cost will be higher, but during the construction and maintenance phase these costs will be recovered and probable much more – here is the ROI
As my intention was to write shorter blog posts this year, I stop at this point and look forward to your comments for a further discussion.
YOUR THOUGHTS ??
Related articles
- Why PLM 2.0 – Conclusions (virtualdutchman.com)
Last week I started a small series of posts related to the topic PLM 2.0. I was hoping for more comments and discussion about the term PLM 2.0, although I must say I was glad Oleg picked it up in his posts: PLM 2.0 born to die? and Will JT-open enable future of PLM 2.0?
Oleg, as a full-time blogger, of course had the time to draw the conclusions, which will take me another two weeks, hoping meanwhile the discussion evolves. Where Oleg’s focus is on technology and openness (which are important points), I will also explain that PLM 2.0 is a change in doing business, but this will be in next week’s post.
This week I will focus on the current challenges and pitfalls in PLM. And we all know that when somebody talks about challenges, there might be problems.
| Last week | : What is PLM 2.0? |
| This week: | : Challenges in current PLM |
| Next | : Change in business |
| Final post | : Why PLM 2.0 – conclusions |
The Challenges in current PLM
First I want to state that there are several types of definition in the world for PLM, coming from different type of organizations – I listed here two vendor independent definitions:
In industry, product lifecycle management (PLM) is the process of managing the entire lifecycle of a product from its conception, through design and manufacture, to service and disposal. PLM integrates people, data, processes and business systems and provides a product information backbone for companies and their extended enterprise.
Product Lifecycle Management (PLM) is the business activity of managing a company’s products all the way across the lifecycle in the most effective way. The objective of PLM is to improve company revenues and income by maximizing the value of the product portfolio
And there are more definitions. Just recently, I noticed on the PlanetPTC blog from Aibhe Coughlan a post where she promoted a definition of PLM published in the Concurrent Engineering blog. Here I got immediate a little irritated reading the first words: “PLM is software designed to enhance process efficiencies ……… and more …”
I do not believe PLM is software. Yes there is software used to automate or implement PLM practices, but this definition starts to neglect the culture and process sides of PLM. And as Oleg was faster – read his more extended comment here
(I am not paid by Oleg to promote his blog, but we seem to have similar interests)
Back to the classical definitions
The Wiki definition gives the impression that you need to have an infrastructure to manage (store) all product data in order to serve as an information backbone for the extended enterprise. It becomes more an IT-project, often sponsored by the IT-department, with the main goal to provide information services to the company in a standardized manner.
This type of PLM implementations tends to be the same type of implementation as an ERP system or other major IT-system. In this type of top-down implementations, the classical best practices for project management should be followed. This means:
- A clear vision
- Management sponsorship
- A steering committee
- A skilled project leader and team
- Committed resources
- Power user involvement
- Communication
- …… and more …
These PLM projects are promoted by PLM vendors and consultants as the best way to implement PLM. And there are a lot of positive things to say about this approach. For many big companies implementing cPDM or PLM was a major step forward. Most of the ROI stories are based on this type of implementations and have been the showcases on PLM events. It is true that data quality increases, therefore efficiency and product quality. Without PLM they would not reach the same competiveness as they have now.
But sometimes these projects go into extreme when satisfying users or IT-guidelines
To avoid the implementation of a ‘new IT-system’, companies often have the strategy that if we already have an ERP-system , let’s customize or extend it, so we can store the additional data and perform workflow processes based on this system.
In a recent webinar, I heard a speaker saying that in their company they had the following automation strategy defined together with IT is:
- First they will see if the needed PLM functionality exists in their ERP system or is part of the portfolio of their ERP provider. If the functionality is there (this means the ERP vendor has the capability to store metadata and a factsheet mentioning the right name), there is no looking outside.
- If the functionality is not there, there will be a discussion with the ERP vendor or implementer to build it on top of their ERP system.
I have seen implementations where the company has developed complete custom user interfaces in order to get user acceptance (the users would not accept the standard graphical interface). At that time, no one raised the flag about future maintenance and evolution of these custom environments. The mood was: we kept it simple – one single system.
I believe this closes the door for real PLM, as storing data in a system does not mean you will use it in an efficient and optimized manner. How will you anticipate on changes in business if it is just doing more with the same system?
And mid-market companies ?
The top-down approach described before is the fear of many mid-market companies, as they remember how painful their first ERP implementation was. And now with PLM it is even more unclear. PLM aims to involve the engineering department, which so far has not worked in a very procedural manner. Informal and ad-hoc communication combined with personal skills within this department was often the key for success.
And now an unfriendly system is brought in, with low or little usability, pushing these creative people to enter data without seeing any benefits. The organization downstream benefits but this will be only noticed later in time. And for the engineering department it will take more effort to change their work methodology focused on innovation. However, in general in the mid-market, the target of a PLM project is to have a Return on Investment (ROI) in a very short timeframe ( 1-2 years). Investing in usability should be even more important for this type of companies as there is less top-down pressure to accept this new PLM system.
And flexibility ?
In the past years we have seen that business is changing – there is a shift in global collaboration and manufacturing and from the recent history we can learn that those big enterprise projects from the past became a threat. Instead of being able to implement new concepts or new technology, the implementation became more and more vendor monolithic as other capabilities and applications do not fit anymore. This is against the concept of openness and being flexible for the future. I believe if PLM becomes as rigid as ERP, it blocks companies to innovate – the challenge for big companies is to find the balance between stability and flexibility (This was the title from Sony Ericsson’s presentation at the PLM forum in Sweden this year)
And again for mid-market companies who do not have the budget or resources to invest in similar projects. They have less a drive to optimize themselves in the same manner as big companies do as flexibility is often their trade mark (and capability to innovate) . So PLM for the mid-market will not work in the classical way.
This is one of the reasons why a mid-market PLM standard has not yet been found (yet ?). From the other hand many mid-market companies are dealing with PLM practices although often it is more close to PDM and CAD data management. And mid-market companies do not change their organization easily – there is more a departmental approach avoiding therefore a change in business.
To summarize the biggest challenges in current PLM described in this post:
- PLM is considered complex to implement
- PLM is a huge IT-project
- PLM requires change and structuring – but what about flexibility
- Where is the PLM value and ROI – user acceptance
- PLM for the mid-market – does it exist ?
Conclusion: I have been writing about the PLM challenges in the past, see the links below if you are interested in more details on a specific topic.
In 2008,I thought that Out-of-the-Box PLM systems and standard functionalities could bring a solution for the mid-market, perhaps future solutions based on the cloud. However I learned that if you want to do real PLM in a modern manner, you need to change the way you do your business – and this I will explain in my upcoming post.
Related links:
During this summer holiday, I was looking back on recent implementations and sales efforts related to PLM. Some had particular challenges regarding the PLM implementation and the relation to the IT department. The role of the IT-department was crucial, but always in a positive manner ? Judge yourself.
First this statement:
In many mid-market companies the choice for PLM is not that clear.
Let me explain what I mean by a typical mid-market company – it is not based on size or turn-over. For me a mid-market company is a company, not allocating the resources to have an overall strategic department and in addition the IT-department is limited to a team of people with a main focus to keep the company operational – ERP first.
The impact of this situation is twofold:
- From one way new business initiatives will mostly come from departments, either sales, marketing, engineering, production, service or IT. Companywide business initiatives are not likely to come from a separate department as each department is working on their own issues.
- Secondly IT often has a tendency to ‘standardize’ on certain environments. Some quotes:
“We love/hate Microsoft”
“SharePoint is our standard”
“If it is not Linux it is not reliable”
“Our ERP provider has also a PLM module, so this is going to be the standard”
And this standardization is often at the end the business killer
So where does PLM come from in a mid-market company ?
Example 1: The IT-department in company XYZ had the opinion there was a need to provide a company infrastructure for document management – people complained about not being able to find the right information. Related to the CAD system in use, it often became a kind of PDM implementation with extended document management. The IT-department provided the infrastructure (we need Oracle / SQL /DB2 – based on their standards) and engineering was allowed on top of that infrastructure to define their PDM environment.
As most of the people involved in this project were very familiar with computers, the implemented system was highly customized, due to specific actions the engineers wanted and what IT envisioned users would require. The overall thought was that other users would automatically get enthusiastic when seeing this implementation
In contrary: the regular users refused to work with the new PDM system – too complex, it takes too much time to fill in information and in situations of heavy customization some users became afraid of the system. Making one mistake was hard to undo and could have a chain reaction of events further down in the organization. They preferred the traditional method of sending documents or Excels to the other departments and getting face-to-face feedback. Of course in case of missing information or a mistake this could be clarified easily too.
Conclusion from all the PLM pessimists: PLM is too complex, PLM is hard to implement.
My intermediate conclusion: Good will to improve the company’s business is important, however you need business people to define and lead the implementation.
Example2: IT in a company ABC developed a custom PLM infrastructure for their users and everyone was happy, till …… business changed. Where several years ago, the users decided that the standard PLM software was not good enough as some details were not supported and the standard system PLM system was able to do too much, IT generously decided to build a complete, nice user environment for their company.
Everybody happy for three years, till recently, due to acquisitions, outsourced contracting (engineering and manufacturing), the IT-department has to hire more people to support more and more custom connections and data exchange. Now in an overheated state they are looking for ways to use PLM standard software instead, however IT does not want to write off the previous investments that easy, the users are not aware of the problems in changing business and the future PLM decision is again driven by IT and not by business,
Internal conclusion: The IT-department was very helpful for the end users, who appreciated the simple to-the-point interface – whispering: Therefore never a change process took place anticipating strategic changes upcoming. The result a kind of dead end.
My intermediate conclusion: If you are a mid-market company and you are not in software development, stay out of it. It is always a temporary and people dependent (who can/will leave at some time).
Just two examples out of many, typically for mid-market companies. I think also larger enterprises sometimes demonstrate the same problematic. Good IT-people and IT-department are crucial for every company. The challenge is to keep the balance between business and IT. The risk is that due to the fact that there is a lack of business strategy resources, the IT-department becomes the business standard.
Conclusion: PLM is about business change and PLM is not an IT-tool. However a PLM implementation requires good and intensive support from IT. The challenge for every company is that the IT-department often has the most skilled people for a company-wide implementation, however the business drivers and strategy should come from outside.
Your thoughts ???
Recently i noticed two different discussions. One on LinkedIn in the CMPIC® Configuration Management Trends group, where Chris Jennings started with the following statement:
Product Lifecycle Management (PLM) vs CM
An interesting debate has started up here about PLM vs CM. Not surprisingly it is revealing a variety of opinions on what each mean. So I’m wondering what sort of reaction I might get from this erudite community if I made a potentially provocative statement like …
“Actually, PLM and CM are one and the same thing” ?24 days ago
It became a very active discussion and it was interesting to see that some of the respondents saw PLM as the tool to implement CM. Later the discussion moved more towards system engineering, with a focus on requirements management. Of course requirements management is key for CM, you could say CM starts with the capturing of requirements.
There was some discussion about what is the real definition of PLM and this triggered my post. Is the definition of PLM secured in a book – and if so – in which book as historically we have learned that when the truth comes from one book there is discussion
But initially in the early days of the PLM, requirements management was not part of the focus for PLM vendors. Yes, requirements and specifications existed in their terminology but were not fully integrated. They focused more on the ‘middle part’ of the product lifecycle – digital mockup and virtual manufacturing planning. Only a few years later PLM vendors started to address requirements management (and systems engineering) as part of their portfolio – either by acquisitions of products or by adding it natively.
For me it demonstrates that PLM and CM are not the same. CM initially had a wider scope than early PLM systems supported, although in various definitions of PLM you will see that CM is a key component of the PLM practices.
Still PLM and CM have a lot in common, I wrote about is a year ago in my post: PLM, CM and ALM; not sexy ! and both fighting to get enough management support and investments. There is in the CMIP group another discussion open with the title: What crazy CM quotes have you heard ? You can easily use these quotes also for the current PLM opinion. Read them (if you have access and have fun)
But the same week another post caught my interest. Oleg’s post about Inforbix and Product Data Management. I am aware that also other vendors are working on concepts to provide end users with data without the effort of data management required. Alcove9 and Exalead are products with a similar scope and my excuses to all companies not mentioned here.
What you see it the trend to make PLM more simple by trying to avoid the CM practices that often are considered as “non-value add”, “bureaucracy” and more negative terms. I will be curious to learn how CM practices will be adhered by these “New Generation of PDM” vendors, as I believe you need CM to manage proactively your products.
What is your opinion about CM and PLM – can modern PLM change the way CM is done ?
In the past two weeks I had some interesting observations related to the core of PLM. Reading posts and some in-depth discussions with customers lead to the statements below:
Single version of truth ?
First I am going back to the intent of PLM – companies that implement PLM are not looking for a system where they can store information in a single database. Often the single version of the truth story is translated into technology . To illustrate this statement I was explaining a medical device company some weeks before how in PLM practices the interaction of requirements, integrated with regulatory compliance verification speeds up the product development process as deviations are early discovered during the development stage. The astonishing answer from the customer was; “Yes we already store this information in our well-known ERP system – so no need for PLM to handle this”
For this person the conclusion was that once data is stored in a system, it is managed. However what the company never tried was to track each requirement individually (and its possible change) during the engineering process and have a direct connection to regulatory demands.
In that area Excel, people’s knowledge and stored documents were used to collaborate. Off course with the late discovery of errors and several extra iterations due to it. As long as this company does not understand that the PLM system is not yet another tool to store data, but an enabler to work different and more efficient, these tools based statements will not bring them further. But as nobody get fired for selecting a well-known ERP system, but trying to change the way people work is a risk, often the first option is chosen.
And the more conservative the company culture, the more likely this will happen.
Tools do not make a change
In a last week meeting I met a VP of a business group of a real global company. I am stressing the word real as there are many global companies, that actually have one main location where the IP and influence comes from – as compared to the real global companies where all around the world the knowledge and IP of the company is invented and spread from there. Although the discussion was on the current status and quality of the tools in use, during breaks we concluded that although the discussion is about tools, the hardest part for implementing PLM in their company is to master and motivate the changes in the way of working towards the users.
In several blog posts from Oleg (and others) I see the hope that new user interfaces, user data handling can provide a break through here. I partly agree here – in the eighties/nineties we had the single window terminal screens, which were easy to understand (no multi-tasking / no multi-windows). Slowly the current workforce got used to windows (still no multi-tasking) and the new generation (generation-Y) is less and less single tasking and has different ways of solving issues. New interfaces can contribute to the acceptation of a tool, but as in the end we are still doing the same – storing data in a central system without changing the way we work – there is nothing improved
MBOM in PLM
Another interesting statement of this VP was also that they are in the process of bringing all engineering data coming from different disciplines in their R&D / PLM environment. Originally it was the ERP system that was used to combine all data coming from different disciplines. However the disadvantage was that this product definition resided partly in an ERP (there is no concept of a single ERP as manufacturing differ so much globally) and partly in PLM. Their future plan was therefore to extend the coverage of PLM toward the whole preparation for manufacturing – my favorite topic too: see Where is the MBOM ?
Conclusion so far
In day to day relations customers and PLM vendors, implementers are talking about functions and features to implement and where and how data is stored. The major driver should be the concept of changing the way we work to be more efficient, more clever and with higher quality. This is not reached by storing data, but by having the right data available at the right moment. And this moment changes when implementing PLM
- PLM Customers: Make sure that change of doing business is the target of your PLM implementation – do not look for tools only – check with your implementer and vendor which experience they have.
- PLM Implementers: Schedule time and activities during the implementation to understand the business change and the customer to adapt. It is a different type of skill required but as important.
- PLM Vendors: You have a hard time – as all are talking about the tools, you do not want to talk about the changes PLM implies – a pity but most customers do not want to hear this side during their PLM selection process
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:
- 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 ?
- 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.
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.
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. 
Jos Voskuil's Weblog 
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