Reconstructing PLM

Taking it all apart

PLM seems like a reasonable abbreviation for "Product Lifecycle Management", a term widely used by IT vendors to sell their wares. But what does this technology offer manufacturers and those in industry? Let's take PLM apart and look at the definitions of each word in the Oxford Paperback Dictionary by my desk:

Product 1) Something produced especially by a natural process or by agriculture or manufacture
Lifecycle The series of changes that characterise the life of an organism or thing
Management 1) Managing; being managed.
2) The process of managing a business; people engaged in this

Put together again as PLM they trigger a number of questions. "What sort of product? How long a life and what sort of changes? What type of management?" immediately spring to mind.

A product can be a largely intangible service - an insurance policy, for instance, or an on-demand IT infrastructure - or a tangible physical object - as simple as a metal can, or as complex as an aeroplane.

These examples have a different length of life - in the case of insurance it might literally mean an individual's lifetime, 70 plus years; an aluminium can, precisely 319 days* from ore to store; and a commercial airliner, 30 years, perhaps even longer. They also potentially change during the course of their natural lives in very different ways.

And we all have our own particular views about "management". In reality we are talking about the business and operational decisions by which a company is run - what processes and what interventions, and by whom - that are necessary for the successful running of a business.
Putting it all together…

All the above products and lifecycles are also very different in terms of their business processes and the interventions required in their management. A single system which could accommodate all these potential differences would have to be immensely large and very flexible. Never-the-less, the concept that digital product data can be managed from earliest concept to final retirement and recycling is the same across the whole range.
Put simply, Product Lifecycle Management, as it is portrayed, still appears to cover an awful lot of ground, particularly when you consider the wide range of companies that use that term, or similar, with one or any of the three letters P, L or M.
Haven't we been here before…?

I'm sure we have all heard examples - and "Product Design Lifecycle", "Engineering Data Management", "Product Data Management", "Infrastructure Lifecycle Management", "Document Lifecycle Management" are but a few - that simply add to the plethora of TLA's (sorry about that one) abounding in the trade press and marketing collateral of IT vendors. Is PLM just one in series of attempts by marketing departments to grab some cheap copy in the trade press to sell whatever the vendors have, or are the IT vendors offering tools which will genuinely help companies achieve their strategic objectives?
Discontinuity…

Before we start to address that question, let us look back over the changes that have taken place in the last five years, both in manufacturing industry and within the IT vendor community. And it is not all good news!
The Bubble burst…
Back in 1999, the IT community was profiting from the Y2K issue, the Internet bubble was expanding, seemingly like the universe, infinitely, and manufacturing users still had money to invest in plant and equipment. How things change! The bubble burst, IT stocks crashed, and following a period of consolidation, itself not without casualties, the IT vendor community has shrunk. Only now, in 2004, has real growth started, whilst revenues are approaching the levels seen back in 1999/2000. The business outlook and new demands on IT have altered the vendors' landscape significantly; things will never be the same for them again.
Manufacturing goes south, then East…
Manufacturing, the market addressed by these vendors, has also undergone a series of fundamental changes. A global slow-down resulted in lower revenues for manufacturers and their restructuring, also on a global scale. As stock prices fell, manufacturers' capitalisations also fell, presenting more difficulty raising capital. Cost-cutting and disposals, not re-investment, became dominant themes, as companies readjusted to match capacity with demand they could fulfill and still make a profit.

This has not been an easy equation to solve. The rapid emergence of China as the industrial workhorse of the world has taken many by surprise. Aided by favourable exchange rates and a cheap but well-educated workforce, China can mass-produce products at prices that make most UK manufacturers weep. Manufacturing companies must respond to this challenge; sitting on their hands will just not work!
Does PLM present an opportunity to make a difference?

Back to the question in hand: Can PLM really make a difference?
And the answer has to be: A qualified, "Yes". (This may seem rather a cop-out, but please allow an explanation for this.)
As demand picks-up in the West, there is little spare capacity left to soak up that demand. With manufacturing economics shifting to favour low-cost, volume production in the Far East and elsewhere, companies in the UK, in common with most Western economies, must re-examine the way they produce things.
Make or buy…?
Whole departments may be outsourced, like after-sales service and maintenance, as companies concentrate on core activities and skills. Decisions about make or buy become crucial to profitability and investment plans. Products may need re-designing to accommodate cheaper components or to allow assembly by non-skilled workers, and these work-packets and instructions need to be created and tracked. Customer and product records may also need to be shared between organisations.

Many manufacturers go down this route to find that, despite excellent internal communications, once information leaves the company, there is no process in place to manage external stakeholders - be they suppliers, design consultants, salesmen, service engineers or customers.
A place for PLM?

This new landscape requires IT solutions which allow for greater control and visibility of dispersed resources across international and company boundaries. PLM for manufacturing companies is designed to bridge those gaps. PLM essentially manages and maintains product links between engineering applications (CAD, CAM and CAE) and expands use of that data into downstream enterprise and business applications, such as ERP (Enterprise Resource Planning) or CRM (Customer Relationship Management) and DM (Document Management), for instance.
One-size does not fit all…!
There are differences between vendors in their approach to PLM, despite using the same acronym. Enterprise applications vendors generally approach PLM as a system which takes the fully-defined product record forwards into manufacturing and resource planning systems and through to business systems like sales order processing, financial accounting and beyond into after-sales. Typically, where design is not a key differentiator, and there are few iterations or stakeholders, this type of PLM may well be the most appropriate. A contract make-to-order company fits this bill, where manufacturing process, rather than product design, is the key differentiator.

Where much of the value-added is in the engineered design of a product, far more design iterations may be needed and far more stakeholders may be involved - especially if suppliers are responsible for the design of individual components - before a product is fully defined. The PLM offered by CADCAM vendors is generally much more attuned to the integration and management of the design data and process into downstream areas for use in more complex, multi-disciplinary engineering projects. A PLM project may even integrate suppliers, such as contract manufacturers, with their OEM. An aerospace manufacturer is a typical example of this. Where time-to-market is an issue, such as in a fast-moving consumer goods company, PLM may be used to bring product design, package design and manufacturing planning within the same environment.
An answer to red-tape….

PLM may also help in an increasingly regulated world. Although not many people will have heard of these initiatives, the European Union has already passed environmental legislation to deal with Waste Electrical products and End-of-Life Vehicles within the 25 EU states. Although much legislation is still in translation into national law, producers of such products will have to demonstrate compliance to changing targets in their use of certain materials and in recycling of metals and plastics between 2007 and 2015. Tracking parts, for instance, as they are changed to ensure compliance to current and future requirements, is just one example of where PLM can aid this process.
Technology itself can only enable change; it is not a panacea…
Even within these examples, there are many companies that fit neither one category nor another well and who are facing very different business challenges for the future. This demonstrates why a PLM implementation may need customisation to meet a company's unique requirement or how much a company may have to consider changing the way it does business, in the light of what this technology may make possible.

Perhaps this is where some of the adverse publicity about this technology comes from. If the staff concerned is not behind any change during a PLM project, then the chances of success may be limited. Like any tool, PLM will only be effective if those using it have a clear vision of what they want it to do. Least we forget, even in this fast-changing world, people, not technologies, make products!

* Source: "Lean Thinking" authors James Womack and Daniel Jones, discussing research by Cardiff Business School about the making & processing of a Coke can.

Nick Ballard