PLM and Product Innovation

Few weeks ago, I promised to blog about PLM and Innovation. It started by the following post – “PLM vs. ERP: Don’t manage innovation“. Thank you all for great discussion since then! Now, this is a time for me to summarize and share my thoughts.

My short conclusion about Product Lifecycle Management in the context of innovation is as following. PLM is one of the ultimate systems that can enable innovation in the organization. However, I don’t see how PLM can literally manage innovation. I think about innovation as a process in the organization. The core idea behind this process is how to manage risks related to overall innovation activities. I’ll explain this using something I call “Goose Innovation Strategy”.

Goose Innovation Strategy or How To Convert Innovation to Math? Let think about innovation as a controlled multi-dimensional activity. Our interest is to get a particular outcome, which in case of product development can be considered as next product, versions or the next product features and/or improvements. Nevertheless, developing of something new is a very risky task. What we need to do when we want to  reduce a risk? We want to distribute risk into separate activities. If we develop a single golden egg, it can crack. However, if we will be investing into Goose that laying down golden eggs, our situation can be much  better. You are able to predict results. So, think about hedge fund. Distribute risks, allow to multiple people to product multiple ideas related to the product. In this case, your future might be much more secured. Some of your golden eggs will crack, nevertheless, statistically you should be ok. The bottom line – don’t invest into golden eggs, since they can crack. You better invest into Goose in your organization that laid golden eggs. Your innovation process is how to deliver a decent percent of those eggs. And this is pure math.

PLM Role in Goose Innovation Strategy
So, how PLM can help you to apply Goose Innovation Strategy? I figured out top three factors or components of that. They are belongs to Product Lifecycle Management and needs to be supported for efficient product innovation.

1- Product Data

In my view, you need data to innovate. Period. In context of PLM, this just to say – make your product data available. If you have access to the product data (people like to call it “a single point of truth”), you’ll be able to use it as one source of innovative ideas. It is always good to have a reliable source of information about how a product designed, manufactured and built – this is an endless source of innovation.

2- Product Ideas.

Product Ideas are everywhere. In your organization,  ideas are in the heads of people that bring these ideas. No ideas – no innovation. Remember ideas, capture them, analyze them. Therefore, the next effort needs to be focused on how to capture and access all ideas available in the organization. In my view, all “social” initiatives in PLM should be focused on this too.

3- Product People

People are the source of ideas. You need to have “product people” to think about how to innovate. In order to do so, they need to exchange ideas, communicate, talk, etc. 10 years ago, the only way to do so was a separate room in the building. These days multiple communication and collaboration facilities can help you. Ideas can come to you at any time. You need to keep your “recording device” and “communication device” open. PLM can keep live links between individuals in the organization and stream of product innovative ideas.

What is my conclusion today? Innovation is a controlled activity and need to be organized and managed in the organization. I don’t see PLM as a primary responsible. However, I do see PLM as one of the enablers for such innovation activity by supporting relations between product data, people and ideas.

Best, Oleg

PS. I’d like to recommend few related books. They are essential, in my view, if you want to dive into innovation.

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8 Responses to PLM and Product Innovation

  1. Thomas says:

    Appreciate the analogy but we have to make sure there is no “Fox” going after your Goose try to steel the golden eggs.

  2. Thomas, I like your idea with fox :)… This is about competitive intelligence, right? Best, Oleg

  3. Paolo Zotti says:

    Oleg,

    great topic!

    I think there are a few angles where PLM can be seen as strategic, and you mentioned some but not all.

    One important thing is that even if you have the greatest idea, you still have to realize it. That means, detail the design and put together the manufacturing process, the procurement strategy etc. PLM can definitely help bring the cost of bringing an idea to the market down. You don’t have to feed the goose with gold to get a golden egg.

    Another important thing is that if you have many ideas, you need to choose which ones to bring forward to advanced stages of development. A managed process will help estimate development costs and timeline, and a digital model of the product will estimate cost and performance of the product at an early stage of development. Less promising products can then be discarded in favour of more promising alternatives, based on facts and not on the gut feeling of a single product manager person. You can quickly drop the bronze eggs in favor of golden ones.

    Third important thing, is that PLM takes repetitive, non-value-added tasks from the creative people (designers and engineers), freeing their minds for more product design and engineering – therefore enabling the goose to produce more eggs in a shorter timeframe.

    Hope this helps,
    Paolo

  4. Ryan Helft says:

    You’re right, PLM and the process of managing innovation are separate. Innovation can be managed though if you apply behavioral sciences correctly, create a good process, can access large groups for feedback and you can bubble up the best ideas. Take a closer look at http://www.spigit.com to see how our customers have done it.

    Thanks,

    Ryan

  5. Brian says:

    Completely agree with the thoughts expressed in the topic. Process is the key to managing innovation. PLM is part of the process not all of it.
    To Thomas’ point even if you suspect a Fox is after your golden goose, process should be seen as your lifeline. With process you can put security in place and make sure the right people are involved at the right times. Without process you are left with many uncommunicated or poorly communicated requirements with key players “keeping their cards close to their chest”. In this environment innovation can only come from a very small group and will often be poorly directed since not enough people know the ultimate direction until it is too late.
    Capture and manage the data.
    Capture and analyse the ideas (this is where requirements, both technical and commercial, come from).
    Keep the “right” people (and that may be all people) connected to ensure collaboration.

    Brian.

  6. Paolo, Thanks! Agree with your additions. However, my main point -you need to feed your goose with “data” to get golden eggs of ideas coming out :). Then, you need to manage them, track, prioritize, etc… Best, Oleg

  7. Ryan, Thank you for comments and welcome! The idea management solution is one possibility to track innovation processes. However, the data availability is imperative for feed idea generation process. I will take a closer look on your solution. Best, Oleg

  8. Brian, Thanks for clarifications! I can see a process as a main driving force for innovation. However, the ability to feed these processes (and people around) with data is very important. Best, Oleg

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