Product lifecycle management (PLM) has hit the radar screens of the technology and business press and is now on the IT deployment agendas of some of the largest manufacturers. But the truth is, most small and mid-size players still don't have a clear picture of what PLM is, let alone what kind of business benefits it can deliver.
Michael Grieves, a manufacturing consultant, professor, and the founder of the Product Lifecycle Management Development Consortium, has set out to dispel some of this "fuzziness" with his new book, Product Lifecycle Management: Driving the Next Generation of Lean Thinking. In the book, which is published by McGraw-Hill, Grieves attempts to bring definition to PLM while dispelling some of the myths and misperceptions.
Unlike the handful of other books written on the subject, Grieves' work was conceived not as an engineering-oriented or technical tome, but rather as a framework for exploring PLM's information-driven approach to achieving greater productivity and increasing profits. Aimed at executives dealing with everything from product development to Six Sigma to supply-chain issues, the book delivers a comprehensive view of PLM, while also addressing the business process change necessary to deliver results.
Managing Automation recently talked with Grieves about where we are in the lifecycle of PLM and what the next stage in the evolution will be. He also offers some insight into how manufacturers can assess their readiness for PLM and what it takes to get started on the journey of technology and business process change that will lead to the next generation of lean thinking.
Q: What's driving manufacturers' need for PLM?
A: Companies have gotten magnitudes bigger over the last 30 years, and the complexity of their products is increasing. Cycle times have dropped dramatically, so the slack time companies have to be inefficient and pull it all together has declined. Globalization is another factor. Being able to parcel out the work to areas where there is competitive advantage -- either through capabilities or labor rates -- yet still function as one big organization is a challenge. What PLM can do is serve as the repository and focal point for all the information companies need to be able to cope in these areas.
From an internal standpoint, there are a number of drivers. Companies need to innovate in order to compete in the marketplace. They can either spend resources duplicating products that exist in their organizations or they can take the same amount of resources and innovate. PLM lets them do that.
At the same time, there's the issue of productivity. Companies can't afford the slack time to do trial-and-error stuff. They have to do more with less. And then there's the issue of collaboration -- getting people to work together to enable a sum that is greater than the individual parts. PLM can help them with those issues as well.
Q: In your book, you tie PLM to the evolution of lean thinking. Can you explain that connection?
A: PLM eliminates waste and inefficiency across all aspects of a product's life, not solely in its manufacture. PLM is focused on using the power of information and computers to deliberately pare inefficiencies from the design, manufacture, support, and ultimate disposal of a product. Wherever possible, PLM enables the movement of inexpensive information bits in place of expensive physical atoms. In doing this, PLM takes lean to the next level.
Lean manufacturing is a continual process that works at taking out the inefficiencies in the manufacturing process. However, as lean manufacturing efforts find and eliminate waste, products are being produced less efficiently at other phases of development. PLM uses product information, computers, software, and simulations to produce the first product as efficiently and as productively as the last product through- out the design, development, and delivery process.
Finally, lean manufacturing can only take an organization so far. The most efficiently produced product resulting from the best lean manufacturing processes can be flawed as a result of design failure or failure in actual use. It is nothing more than efficiently produced scrap that is a waste of time, energy, and material. PLM, by taking information from other parts of the lifecycle like product usage, is another way of getting waste out of the system.
Q: How do you assess an organization's readiness for PLM?
A: I'm not a believer in best practices. What makes an organization unique in terms of competitive advantage doesn't necessarily move from organization to organization. That said, what manufacturers have to do is assess three elements: people, processes and practices, and technology, and assess them from within the context of a framework such as the Capability Maturity Model (CMM). The idea is to understand how well an organization is set up to improve itself. On one hand, you have the ad hoc organization, which has no set ways of doing things and no process procedures in place. They would have a lot of work to do to get ready for PLM. On the other hand, an organization that operates at CMM Level 5 and is optimized, measures itself against specific metrics, and is continually looking at ways to improve its processes and metrics would be better able to reap the benefits.
I propose looking at your various areas of operation and assessing them against the CMM. Rather than taking the knee-jerk reaction and saying you want to achieve CMM Level 5 in all areas, look at your requirements for where you want to be, assess the gaps, and then you can determine where PLM will be the most help.
Q: What are the best places to start with PLM, and what are some recommendations for planning a PLM roadmap?
A. You have to have a vision of what your organization needs to be and, once you have that, you can determine where to start. It's very organization-specific. That's why PLM is best done at a strategic level as opposed to having an engineering department say, "We're going to do PLM."
PLM is a conceptual framework for an entire organization; so to say, "We're implementing it in one department" is a contradiction in terms. That's not to say you can't get value out of PLM tools and approaches, but to truly do PLM, you're looking at taking a corporate-wide approach to how you handle information about products.
Q: What lessons from ERP implementations should be applied to PLM deployments?
A. There was a study done by Brown and Vessey that looked at ERP systems in order to determine what factors differentiated successful ERP implementations from unsuccessful ones. The success factors were: top management is engaged, not just involved; project leaders are veterans and team members are decision makers; third parties fill gaps in expertise and transfer knowledge; change management goes hand in hand with project management; a satisficing mindset* prevails.
Although PLM has its biggest impact as a corporate initiative, there are actions and initiatives that managers who do not control their corporate agendas can take. They can think like a CXO and initiate PLM projects that support corporate initiatives, engage in sharing information with adjacent functional areas, refrain from taking a myopic view of their decisions that affect other areas, and encourage their peers to work toward "One Company."
* Pursuing a result that is good enough, but not the best available.
Q: What are the key change capacity issues surrounding PLM, and how can organizations best deal with them?
A: The biggest roadblock is getting people to think about doing things differently than they've done in the past. PLM alone is not going to solve your problem -- you have to have people willing to change. Therefore, you have to educate people in why they need to make those changes.
How do you do that? Leadership is a key element, and you have to have a well-defined mission as to what you're trying to do. A lot of it is context-specific: What is the leadership of the organization, how well is the organization defined in what it does, how susceptible is it to change. You have to take all those things into consideration -- there isn't a formula that says, "Do x, y, and z, and the organization will be changed."
You have to have people aligned to do this. This is not just a technology -- it's very people-driven. If you don't have the people involved, all the technology and process charts in the world won't help.