In 2010, Chris Anderson, then editor of Wired magazine, said “atoms are the new bits” – by which he meant
that the rapid innovation cycles and development processes of software were
being applied to the production of physical goods. That’s a quotable way to express
a change I saw in my nine years in industry, and have seen accelerating during
my time at SAP.
We live in an age of choice. When I walk into a store, I have more
options than ever before. If none of those appeal, many more are available
online. I may be able to customise the product to my personal taste – what was
once reserved for high-end automobiles is now a feature of mid-market smartphones
and sports shoes.
From idea to performance
Designers – whether they are designing laptops or toothpaste – have
to match the hunger of the market not just for choice, but meaningful choice
and progressive improvement. Customer demand is outstripping the ability of the
traditional product development process to supply it. The traditional process –
of linear progression through a series of “approval gates” – cannot keep up.
At SAP, we talk about product lifecycle management in the context of
“idea to performance”. I tend to simplify this as “time to money”: every day
lost through inefficient processes is at best a day where the idea is not
realising value, and at worst an increase in the risk that it may be beaten to
market by a competing product. The first question is “should we make it?” The
next is “how soon can we get it made?”.
A successful product lifecycle management system replaces the linear
process of review with a process that connects at all points, pushing the
relevant data in the relevant format to those who need it. It should also be
fully integrated with other systems: manufacturing, sustainability, enterprise
asset management, and portfolio and project management, just to name a few.
So, the R&D team can map a product, and ensure that it is
compliant with the latest regulations in a given country, before taking it out
of a computer model and into the lab. Marketing teams can focus on
differentiating features at the consumer level. And the entire lifecycle of the
product, from production to recycling, can be planned out
There are numbers describing the benefit of an integrated, data-driven
approach to product lifecycle management. According to SAP performance
benchmarks, companies that track and analyse key performance indicators for
standardised asset management throughout their facilities have 29% lower
service and maintenance costs. And, vitally, a formal product lifecycle
management process reduces time to market – and therefore time to money – by 14%,
and product lifecycle management costs by 67% when product data is centralised
through the development process.
Of course, every product is different. If you would like to know
more about SAP’s approach to Production Lifecycle Management, download our
white paper, Idea to Performance, and explore SAP’s solutions for
Research and Development here.