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Author's profile photo Former Member

PLM is Dead, Long Live PLM


Many of our customers have come to us asking for a Product Lifecycle Management (PLM) solution to fast track their businesses. The challenge here is that PLM is a strategy, not necessarily something that can be bought, deployed and checked off the list. More recently, I see that the most successful customers approach this domain with a focus on creating and enabling a product innovation platform that connects people, process, technology and data in order to orchestrate the value creation process surrounding the birth of any product.

Driving and as a backdrop to this product innovation platform emergence are the technological advancements of the past decade that have ushered in a new era of customer expectations. Gone are the days when Henry Ford famously quipped “You can have any color you like so long as it is black.” Today, whether considering B2C or B2B sales, the customer often will settle for nothing less than an individualized solution—be it a car or a chemical. Further exacerbating the challenges that this level of customization creates, design cycle times continue to be driven down; the acceleration of the market being driven by greater competition, quickly changing customer needs or wants and the technological know-how to deliver on even shorter turn arounds. The icing on the cake with all of this is the massive amounts of information now available—be it market data, regulatory, product, customer, the list goes on.

With increasing customer expectation, more competitive market dynamics and a veritable ocean of data, opportunities abound. Or at least this should be your outlook. Far too often, I find companies that are confused by or, in the worst examples, unaware of the changing landscape. On the other hand, those that understand the situation and commit to action find themselves in an increasingly better place. We have been fortunate enough to work with many of our customers to seize the opportunity and, through these learnings, craft a new strategy for the Engineering / R&D line of business: Connected Products.

SAP’s freshly launched Connected Products strategy is accompanied by several new solutions to help customers best accelerate their businesses in these new market realities. At its core, it is made up of three pillars:

  1. Product Data Assimilation: capture all of the information that sits within disparate, external product networks in order to make the right design decision the first time

  2. Product Individualization: access a product innovation platform to tailor solutions according to customer requirements

  3. People, Process & Technology Orchestration: manage the multitude of resources necessary to ensure the success of a product once you have made the intelligent design decisions and tapped into your product innovation platform

At this point you may be wondering what is a product innovation platform. Simply put, it is a network that allows all stakeholders and data from engineering, manufacturing, procurement, supply chain, sales, maintenance, finance and HR to collaborate on turning a product idea, born in engineering, into a physical reality in the hands of a customer—and back again. This is what SAP has built our business around for the past several decades with ERP serving as the cornerstone.

The Connected Products strategy and portfolio enables Engineering and R&D departments to tap into this platform effectively and efficiently. In many regards it breaks down the silo of engineering to scale their innovations through the rest of the enterprise while also providing them more time to spend doing what they do best: designing products that have the power to change the world.

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      Author's profile photo Former Member
      Former Member

      Garrett, well done and I love the reborn star imagery.  The only thing I would add is the role of Marketing in the design and creation of a new product idea along with Engineering and R&D.

      Author's profile photo Eva Hartmann
      Eva Hartmann

      Garrett, this is great information. Beside the add from David, I would add as well the role of quality department that ensures products fit to regulatory compliance like REACH, RoHS, CO2 and more in different industries.

      Author's profile photo Former Member
      Former Member
      Blog Post Author

      Great points from both David & Eva. I thnk both Sales & Marketing play an important role for product creation--Marketing more from molding new ideas during the ideation phase and Sales potentially as a direct contributor via processes like Configure, Price, Quote.

      Quality is equally important. I find thi sone particularly interesting given that it varies by customer and in many cases is spread across several different departments. What has been your experience?

      Author's profile photo Eva Hartmann
      Eva Hartmann

      For example REACH is the Registration, Evaluation, Authorisation and Restriction of Chemicals in the EU region. It is valid for all in EU produced or imported products - so it is also valid for producer outside of EU that delivers their products into the EU - so at the end it is a global aspect for the business. Without having the processes and infrastructure in place to control the maximum percentage of restricted chemicals in your products you are lost to sell it. And you should now, that the authorisation institution reduces the maximum amount of the contaminant load of these chemicals year over year to phase it at the end totally out of the products. That means, you need always to know, how much of these chemicals is in your product and if you have several suppliers with different contaminant load for a smilar assambly or half finished good, you need to know, whom to choice best based on actual and future load and availablility. If the authorisation institution ask you for confirmation of your contaminant load in your product, you have only a few days to reach out for this information and deliver it. If you do not, you loose by law the right to sell this product. The complexity in this process is really high! Think about your product consitst of 500 parts. 50 parts of the 500 have chemical content that is listed in REACH. 30 of these parts you buy from external supplier. For each of these 30 parts you have 3 possible suppliers in your list. So you need to ensure with 90 suppliers to get all this content information in time and always updated, if they have a change in their supplier product. Think about if in several of these 30 parts is the same chemical content listed in REACH - you have to add this contaminant loads to check if you are still compliant with your product. By the way, how much products you produce?

      I discussed that problem with companies, that makes water-heater, a huge bunch of different medical devices, producers of household products and much more. To understand, which decision for a NPI would be the best from risk / chance perspective, you need to have a fluent strong PLM process for the whole enterprise with all mentioned organisations in it.