Product lifecycle Management

By: kevin p.prendeville and AJ Gupta

At the 2010 Beijing International Automotive Exhibition, car enthusiasts and the media mobbed the displays of shiny new models rolled out by China’s own carmakers. And auto-industry observers’ blogged busily about how long it would take for a Chinese brand to join the league of world-class car marques.

But the grittier interactions took place behind the scenes, where global automakers discussed what it takes to engineer cars at competitive prices for buyers in various markets around the world. The conversations explored everything from the most suitable market feedback channels for global development centers to what innovations are needed in design, development, vehicle features and production processes.

And it’s not just car manufacturers that are poring over these kinds of details. These days, companies in industries ranging from oil and gas to retail to consumer packaged goods are obliged to think about challenges industrial manufacturers have faced for decades: more effective product development and lifecycle management.
The business discipline that can help companies manage these complexities is called product lifecycle management, or PLM. Long known inside engineering departments in the industrial manufacturing sector, PLM is emerging as a strategic capability critical to achieving high performance. What’s needed now is wider recognition of the fact that PLM is much more than simply a means of managing product data. It is in fact a tool for maximizing returns on product development spending and for getting more innovative ideas and output from the employees involved at various points in a product’s lifecycle.

Every product has a lifecycle, starting with ideation and moving through formal design, development, prototyping, production, spare parts and support phases before the product is finally withdrawn from the market. The idea of an overarching discipline that links many of those phases is familiar to managers in industrial companies.

Globalization is also accelerating the spread of product development activities among many more enterprises; the rudder of Boeing’s new Dreamliner 787 is being made by Chinese aircraft systems makers, for example. And in the consumer goods sector, open-innovation initiatives are making the process far less reliant on what comes out of corporate R&D centers. For example, more than half of all product innovation coming from P&G today includes at least one major component from an external partner.

Product development is further complicated by the growing use of embedded software and systems in products (think of the OnStar system in General Motors vehicles or the wash-cycle programs in Miele washing machines). Even leading manufacturers that long ago mastered the design and development of physical parts are challenged to meet the particular demands of high-tech product design, development and production. There are frequent wrenches in the works where mechanical and electrical systems and embedded software must come together.
On top of those challenges comes the clamor for sustainability: pro-ducts designed so that their green content—and that of their packaging, manufacturing processes and supply chains—is clearly identified and so that they can be easily recycled at the end of their lives. Adding to these complications are product regulations that are often markedly different from one jurisdiction to another. Just one example: More and more US states are passing laws that hold manufacturers responsible for recycling their products. 

The enterprise resource planning vendors hope to fill some PLM gaps. Providers such as SAP and Oracle can now manage and integrate certain PLM data into sales, cost and other ERP data. While they lack deep PLM relationships with engineering teams, they have close ties with chief information officers—and the marketing heft to broadcast their claims. In a third category are the myriad niche players with point solutions such as desktop design software for product developers and solutions for regulatory compliance. Given this fragmented PLM software market, the net effect requires planning for a business process orientated, integrated, multi-vendor PLM landscape.