Winning Products Safeguard Competitive Edge

Feature Article | March 31, 2004 by admin

Mr. Dettmering, generally speaking, leading market research institutes are forecasting high growth rates for comprehensive product lifecycle management and the associated software over the coming years. Are these predictions and expectations also realistic for the SMB market?

PLM is still in its infancy, much like ERP in the 1970s and 80s. PLM has been made possible thanks to modern computing capacity and is needed as a response to technical systems that produce a deluge of information, such as CAD (Computer Aided Design) systems. Large enterprises played a pioneering role in PLM as they recognized the advantages of a comprehensive PLM strategy early on and invested enormous sums in the appropriate research and technology. Of course, investment on this scale is not realistic for SMBs. First of all, the economic risk is far too high and, secondly, SMBs cannot afford the luxury of customized solutions from a strategic point of view. Yet an SMB’s requirements, i.e. high quality, short development time, low costs and meeting customer demands, and the resulting demands these place on PLM are in no way different than for large companies. SMBs will catch up in PLM terms as technologies and experiences become increasingly standardized.

The term PLM is generally used in connection with sectors such as aerospace, automotive technology, electronics, mechanical engineering and plant construction. Are there other sectors where you see development potential for PLM in the future?

PLM has something to offer every sector which is involved in developing and/or designing a product. It doesn’t matter if it’s an equipment engineering company developing large mechatronic systems to order, a supplier to the automotive industry or a firm manufacturing relatively basic products in series production. However, the approach to PLM will differ greatly in these three examples.

So how then can an SMB decide if PLM is relevant to its business?

The benefits of PLM fall into two categories – direct economic benefits and strategic benefits. The economic benefits are shorter development times, better re-use, reduction of errors etc. PLM also increases the quality of products and the product development process, meaning it can make a useful contribution toward gaining ISO9000 certification. In the automotive industry, large OEMs (original equipment manufacturers) are already beginning to ask suppliers to satisfy high requirements in terms of PLM or are even making it an essential condition for gaining approval as a supplier.

What’s more, the legal framework conditions are becoming more and more restrictive. Companies operating in the food industry will soon have to adhere to product tracking regulations. And SMBs in the aerospace sector, for example, must ensure they have processes in place for long-term archiving. These are just a few examples of the strategic benefits of PLM. If an SMB spots potential in the examples I’ve given, then it should definitely look more closely at PLM.

What are the primary goals that SMBs follow or should follow when leveraging PLM?

SMBs are all very different, yet certain goals are the same for everyone. Every company is looking to improve the quality of its products and ensure the product development process is as short as possible. PLM can help, for example, with automating processes, increasing re-use, ensuring transparency in its products and processes, creating configurable product structures or achieving consistency by means of intelligent interfaces. As I’ve already said, there are also requirements for processes and documentation which arise from ISO9000 certification. Some companies have very individual requirements. Take for example a supplier who is integrated in another company’s production process as an “extended workbench”, i.e. an extension of the company’s own facilities.

In your opinion, what progress have SMBs made in pursuing these goals?

Naturally, every business manages its products and their lifecycles, though this generally takes place manually at the moment. PLM therefore begins with introducing CAD-based structure management or with an interface from the design world to ERP (enterprise resource planning). Most companies have already made a start in these areas, However, the product structures filed in CAD systems only meet basic requirements for certain aspects of products. SMBs also use CAD-related TDM systems (technical data management) which support group work, manage CAD documents and access to them, and enable simple workflows. However, these systems lack support across different disciplines and software. To my knowledge, very few SMBs have end-to-end, company-wide PLM systems based on common standards.

Nowadays product data management (PDM) is frequently encountered in connection with PLM. In fact, the two terms are often used synonymously – or so it seems. What are the differences or indeed similarities between PLM and PDM?

It’s quite true that the terms PDM and PLM are often used to mean the same thing. And no clear distinction has been made up to now. From an academic point of view, product data management is only that part of PLM used for managing product data in the design phase. PLM, on the other hand, supports the product lifecycle from conceptual development right through to recycling. Software manufacturers often make use of the inadequate distinction and use the more modern abbreviation PLM when they really mean PDM.

What is most important for SMBs to take into account when choosing PLM software?

The introduction of PLM software is often mistakenly seen as being the same as the introduction of a PLM strategy. An SMB should first work out its goals along with an appropriate PLM concept, before opting for any specific software. More important than software is the long-term integration of product lifecycle management as an overall concept to create added value in company processes. End-to-end PLM should not be seen as the introduction or operation of a further IT system, such as product data management (PDM) or enterprise resource planning (ERP), but rather as a means to integrate these systems into an overall solution for information management within the company. If one or more extra systems are required to realize the PLM concept, SMBs choosing software in this extremely diverse IT market should be looking for product and process support and a future-oriented software architecture which supports common standards such as Internet technology. This means the future IT landscape within the company can be developed along modular lines. Nevertheless, system adaptations cannot be avoided in the majority of cases. No company will find a system on the market which completely covers its own specific requirements. But a tool that makes the choice of software easier for SMBs is currently being developed as part of the PLM4KMU project.

Mr. Dettmering, thank you very much for participating in this interview.

Dr. Andreas Schaffry

Dr. Andreas Schaffry

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