Why PLM?

Historical perspective

I have been working with CAD, PDM and PLM for a while now. I often see that many companies have gained good control of CAD and PDM over the past 20 years, although there is still considerable untapped potential in both. This includes, for example, parametric and/or automated design on the CAD side, and sound approval workflows and revision control on the PDM side (more on that another time).

C omputer A ided D esign, P roduct D ata M anagement, P roduct L ifecycle M anagement

These concepts are often closely linked. But what people often overlook is that PLM is so much more than product-centric thinking. It is much more than an extension of the engineering department, and far more than just a way to share design information with the rest of the company.

So how is PLM more than product-centric, when product is a central part of the term? The essence of PLM is not about sharing product information across the company (and beyond it). It is about the processes ; digitising, structuring and systematically managing them. There are countless alternatives for simply sharing (large volumes of) data (SharePoint, Dropbox and everything I have not mentioned). What PDM is to product data , PLM is to product processes .

CAD (also known in Norwegian as DAK, short for Data Assistert Konstruksjon, or computer-aided design) completely revolutionised the way products were designed. When it eventually became possible to view the entire product in 3D, this created a completely different understanding of both what the product looked like and how its components interacted.

PDM emerged because it became necessary to organise and manage the large volumes of data that came with the introduction of CAD. As CAD technology made it possible to develop and visualise products digitally, data volumes grew rapidly, and the need for a structured system to manage this information became clear.

PLM probably emerged more as an efficiency measure. In the PLM world, people very often talk about time-to-market (time-to-market). The aim was to shorten the time before other parts of the organisation began working on the product and to improve the quality of change management. The latter, in particular, is often a success factor when implementing PLM. We will look at that in a later post.

Organisational perspective

So, suppose you have a well-functioning development environment with a CAD system that is well integrated with a well-configured PDM system, where, for example, “anyone” in the organisation can retrieve documentation. What is there to gain from a PLM system? After all, PDM takes you a long way towards structuring and organising your data, does it not?

This is precisely where the processes come in; PDM systems rarely provide good support for processes beyond the engineering department. PLM, on the other hand, has (or should have) a bird’s-eye view of the organisation and seeks to connect processes across its departments and disciplines around the product: for example, sales, product development, purchasing, testing, manufacturing, quality assurance, delivery and aftermarket/service delivery. For example, by:

• involving the engineering department earlier in the sales process
• involving the purchasing department earlier so it can plan purchases sooner, while also influencing the selection of components, particularly those with long lead times, high costs or critical performance requirements.
• enabling the test department to plan necessary and mandatory testing, including the associated equipment requirements and any equipment purchases.
• involving the manufacturing department earlier in the design process for planning purposes, but also to influence design choices with regard to manufacturability
• enabling the quality department to get involved early and ensure requirements are met, whether these are internal requirements, customer requirements, regulatory requirements or other product requirements.
• involving the delivery department early so it can influence the design to accommodate logistical considerations (shape, weight, size, etc.) and documentation requirements for delivery (producing and validating final documentation in real time as the product is developed, tested and manufactured)
• enabling the aftermarket team to influence spare parts standardisation and serviceability (is the product easy to maintain?)

These examples illustrate what PLM can address, improve and streamline to support better collaboration across the organisation. A key aspect is often that the different departments collaborate around the same bill of materials, or BOM (Bill of Material), but from different perspectives. I will explore this in greater depth later.

Technical perspective

On the technical side, a PLM system connects different sources of information. Information (data) often originates in different parts of the organisation and at different times. With many units and individuals needing to collaborate, things can quickly become confusing and chaotic, and processes are needed to tie everything together. In that sense, I often say that everyone has implemented PLM in one way or another. However, I often find that processes have not been sufficiently systematised, organised and, not least, defined at an overall level. This is where a digital system that maintains process integrity and manages the interaction between data sources and their associated processes becomes important. There are two aspects of the system I would highlight as absolutely essential:

• The system must be efficient enough that doing things outside it is not faster. It must be built to support and streamline existing/desired processes, not impose unnecessary processes and additional work.
• It is also essential that the system is easy to use. It must be intuitive enough for users who are not IT experts to feel comfortable with it and see the value of actually using it for themselves

Referring back to PDM, it is important to point out that there is often more than one PDM system, or multiple CAD systems producing data that cannot easily be managed in the existing PDM system. In such cases, a PLM system will often be the key to bringing these data sources together in one place that is always up to date (a “single source of truth”). I will return to how this can be achieved technically later.

Financial perspective

I often emphasise that the aim of implementing PLM is not to reduce headcount, but to free up time for more meaningful work. This is how we increase productivity within the existing organisation: we deliver more and/or faster without increasing payroll costs. This gives us a competitive advantage: high output per employee. At the same time, we strengthen employee motivation: people can spend their time doing what they were hired to do and are passionate about. We reduce paperwork and free up more time for value-adding work.

Business outcomes you can expect (and measure) include:

• Revenue**:** Shorter time-to-market, more launches, a higher service “attach rate”.
• Gross margin**:** Less rework/fewer non-conformances, controlled changes, better quality and supplier collaboration.
• OPEX**:** Less time spent searching, on manual handovers and on email-based processes; fewer ad hoc clarifications.
• Working capital**:** Better planning means less capital tied up in inventory and fewer stoppages caused by “long‑lead” items.
• Risk profile**:** Traceability and document control reduce regulatory and delivery-related risk.

I will present practical opportunities to achieve the outcomes above, along with specific metrics, later.

Conclusion

So why PLM ? My “mission statement” is that I am passionate about helping Norwegian industry compete in an increasingly globalised market where competition is more and more based on work and development in so-called low-cost countries. Here in Norway, we cannot compete on labour costs. I believe PLM is the biggest and best opportunity for Norway’s industrial workforce, from Top management to those who “actually get things done”, to become efficient enough to challenge and beat global competitors despite this. But time is short; action needs to be taken here and now! I look forward to rolling up my sleeves and will be publishing more posts here with further details about PLM in the time ahead. Get in touch for a conversation about the opportunities for your company. They are guaranteed to be there!