What is PLM software replacement cycle?

December 13, 2014

plm-recycle

PLM selection is complex process. It takes time to make a decision, evaluate, build a pilot and implement PLM system. I’ve been thinking about how this process can change in the future. Navigate to my Future PLM selection post to catch up. One of my discoveries was the following data point about age of ERP system.

Bluelinkerp blog – When should you replace your ERP software brings an interesting diagram – the majority of ERP implementations is up to 7 years old. The chart based on data provided by Aberdeen study – Aging ERP – When your ERP is too old.

erp-system-age

This data point is not scientific, my I can predict that company is replacing ERP system every 7-10 years. This number is actually aligned with similar numbers I’ve heard from ERP resellers in the past.

It made me think about replacement cycle of PLM systems. I guess we can probably see a similar trend in the PLM market too. PLM systems are aging and we can probably discover lifecycle of PLM implementations. Sort of PLM recycling. I’ve been trying to find some information to support it, but didn’t find much references online.

Joe Barkai’s blog – Product Innovation Congress 2014 San Diego brings some interesting fact about PLM system replacements. Here is the passage from Joe’s blog.

There appears to be much activity in selecting, replacing and upgrading PLM software. Some were first time PLM buyers, but there were a surprising number of companies expressing dissatisfaction with the exiting solution and seeking a “better” PLM system. I did not conduct a structured survey, but anecdotally it appears that a good number of those in search of a PLM replacement are users of ENOVIA SmarTeam and ENOVIA MatrixOne.

My observation: The continued search for a “better” PLM system will continue to drive activity and put pressure on PLM vendors to deliver greater value in enhanced functionality, lower cost, faster deployment, and new delivery and ownership models. The move of reluctant PLM vendors such as Oracle Agile to offer a cloud delivery model is but one recent example and I except other PLM vendors are in the process of following suit. This dynamic keeps the door open for vendors such as Aras PLM that continues to challenge the hegemony of the incumbents.

That being said, buyers should realize that the PLM software itself isn’t a substitute or remedy for flawed and suboptimal product development processes. For each dissatisfied PLM user company you will find many others who are highly successful and are able reap the full potential of the very same PLM software. It isn’t the SW. It’s you. Don’t blame the vendor.

My hunch most of large manufacturing companies already made few PLM system implementations. They made mistakes and probably want to fix them. In addition to that, businesses and systems requirements are evolving. People turnover is another factor. Enterprise systems lifecycle can be triggered by new people coming to the role of managing enterprise and engineering IT. So, 7-9 years, is a good time period to make analysis, fix problems and re-think PLM implementation and strategy.

What is my conclusion? Understanding of PLM software replacement cycle and lessons learned from an implementation can help to build a better PLM industry eco-system. It is less about blaming vendors of companies for software problems. It is more about understanding of business, technologies and implementation needs. Just my thoughts….

Best, Oleg


How to sell PLM to enterprise IT

October 31, 2014

Enterprise IT adoption cycle diagram made by Simon Wardley made me feel sad and funny at the same time. I found it one of the best visualizations of many situations I’ve been in the past when working on PLM sales and implementation situations. This is a brilliant reflection of technology adoption route for IT department – ignore, prevent, tolerate, allow, integrate (credit Joe Drumgoole tweet).

enterprise-IT-adoption-cycle

It made me think about how to prevent a conflict with enterprise IT earlier in the PLM sales process. Today, I want to share some of my recommendations. These steps helped me in many situations. This is not a silver bullet, but I found them useful. PLM system and implementation cannot live in isolation. It has to be integrated with many other systems and processes in organization. Therefore, to learn them early during the sales process can be very beneficial.

1- Learn about enterprise IT

You need to make yourself familiar with basics of enterprise IT. You can bring engineering people to help you at this stage, but you need to get basic information about company enterprise infrastructure, data centers, data management. You need to learn how IT is managed. Is it local team? Does company use outsource IT consultant and service company, etc.

2- Get information about related enterprise software

PLM system cannot live in isolation. So, it will use databases, connect and use variety of application services, integrated with ERP and CRM systems. It will help you a lot to gather information about enterprise software. More specifically, you need to learn about fundamentals of how company is doing item master management, material planning and manufacturing BOM.

3- Find matched solutions

Do some homework and research to find similar solutions and/or references to products already used by a company. It will help you to find precedents and patterns you can refer during the review with IT organization.

4- Ask for meeting with enterprise IT to discuss PLM values and architecture

Don’t wait until late stage to discuss architecture and specific deployment aspects with IT organization. Do it earlier in the process to identify potential conflicts of infrastructure and process implementation – security, data ownership, workflows related to manufacturing planning and supply chain. During the meeting, try to show how IT organization will benefit from adopting PLM solution. It can come in many places – better data management, process optimization, collaboration with suppliers, data integration. Very often, IT organization suffers from complexity of processes IT people need to support. Explain to IT how PLM solution can help if you will have one more vote inside of organization.

5- Make reference call with IT people

Find existing customers that you can reference with similar enterprise infrastructure and solution landscape. Nothing can be more convincing IT people, than speaking to people having same roles in another company. In many situations it can help to solve problems much faster.

What is my conclusion? Enterprise sales requires communication with IT people in organization. One of the mistakes is to think that you need first to convince business and engineering people about PLM solutions. In my view, this is wrong approach. You need to work proactively with IT, otherwise IT can destroy the deal at very last moment. To get references from existing well-known customers is one of the best ways to pass IT. To have certification and/or partnerships with vendors, which products already used and can be referenced is another complementary approach. If you see a major conflict in architecture, system approach or IT strategy, you better get an alert about that early in the process. Just my thoughts…

Best, Oleg

Diagram by Simon Wardley’s blog – Bits or Pieces? (CC BY SA 3.0)


3 reasons why size won’t matter in PLM future?

August 21, 2014

plm-small-big-future-1

The debates about small vs. large PLM implementations are probably as old as PLM software. Joe Barkai recently came with several very controversial blog series – Is PLM Software Only for Big Guys? One of these posts – Do PLM Vendors Think SMBs are Just Like Large Enterprises, Only Smaller? Note the following passage:

In my market research in PLM, PDM and related fields, and consulting work with engineering organizations, I often find that SMBs don’t think of themselves as being just like the “big guys”, only smaller. They believe they possess different culture, work habits and operational models, and perceive PLM as a tool ideally suited for large organizations with sizable engineering teams designing complex highly engineered products.

Another Joe’s post is questioning – Can PLM software benefit small company?

Looking at the profile and size of engineering companies using PDM software, especially those showcased by mainstream PDM and PLM vendors, one might easily reach the conclusion that these systems are, indeed, designed with the “big guys” in mind. This perception may be reinforced by PLM and ERP vendors that have announced products designed for the SMB market and abandoned them a few years later, when rosy revenue expectations weren’t achieved. Remember, for example, PTC’s ProductPoint and SAP’s Business By Design? Small engineering teams have come to think of PLM software as unnecessarily complex and limiting operational flexibility, not to mention the high cost of the software, IT overhead, and the pain of keeping the software up to date.

It is true, that historically of CAD and PDM systems came from large defense and aerospace industry. Since then, lots of innovation in PDM and later in PLM domains was about how to simplify complex and expensive solutions and make it simple, more usable and affordable. 80% of functionality for 20% of price… It worked for some CAD guys in the past. Is it possible in PLM? PLM system fallen into the trap of the simplification many times. As soon as new affordable solution came out for SME companies, it was demanded by large enterprises as well. You can hear an opinion that price was a key factor and PLM vendors didn’t find a way how to sell both enterprise and SME solution with right packaging and price differentiation. Not sure it is true, but to shutdown SME focused PLM solution is not very uncommon in PLM industry.

I shared some of my thoughts about why PLM vendors failed to provide solutions for SME. One of my conclusions was that cost and efficiency are key elements that can help PLM vendors to develop a solution for this challenging market segment.

However, Joe’s posts made me think one more time about “small vs. large” PLM challenge. I want to share with you my 3 hypothesis why size won’t matter for the future PLM solutions.

1. Horizontal integration

Large monolithic businesses with strong vertical integration are displaced by granular and sometimes independent business units with diverse sets of horizontal relationships. Businesses are looking how to optimize cost in everything – development, supply chain, manufacturing, operation. I imagine these businesses will demand a new type of PLM solution that can be used by network of suppliers and business partners rather than by single vertically integrated organization.

2. Technological transformation

In the past, many PDM and PLM vendors assumed SME solution as something that shouldn’t scale much, can run on a cheaper hardware and low cost technology and IT infrastructure. Cloud, web and open source technological trends changed the landscape completely. While most of existing PLM solutions are still running on the infrastructure developed 10-15 years ago, I can see them looking for new architectures and technologies that with no question can scale to cover a diverse set of customers – small and large.

3. Business dynamics

Business environment is changing. Businesses are more dynamic. New requirements are coming often and the demand to deliver a new solution or changes went down from years to months. In such environment, I can hardly imagine monolithic PLM solution deployment that can sustain for a decade as it was before. I would expect PLM vendors to think about new type of platforms and set of agile applications serving variety of business needs.

What is my conclusion? Business, technological and organization changes will affect future landscape of PLM platforms and applications. Small is new big. New technological platforms will be able to scale to support a diverse set of customers. Vendors will be moving from shipping CDs to provide services out of public and private clouds. As a result of that, the difference between PLM for SME and Enterprise PLM will disappear. Future PLM solutions will come as platforms with diverse set of agile applications. Just my thoughts…

Best, Oleg


Importance of data curation for PLM implementations

August 4, 2014

curate-data-mess

The speed of data creation is amazing these days. According to the last IBM research, 90% of the data in the world today has been created in the last two years alone. I’m not sure if IBM counting all enterprise data, but it doesn’t change much- we have lots of data. In manufacturing company data is created inside of the company as well as outside. Design information, catalogs, manufacturing data, business process data, information from supply chain – this is only beginning. Nowadays we speak about information made by customers as well as machined (so called Internet of Things).

One of the critical problems for product lifecycle management was always how to feed PLM system with the right data. To have right data is important – this is a fundamental thing when you implement any enterprise system. In the past I’ve been posted about PLM legacy data and importance of data cleanup.

I’ve been reading The PLM State: Getting PLM Fit article over the weekend. The following passage caught my special attention since it speaks exactly about the problem of getting right data in PLM system.

[…] if your data is bad there is not much you can do to fix your software. The author suggested focusing on fixing the data first and then worrying about the configurations of the PLM. […] today’s world viewing the PLM as a substitute for a filing cabinet is a path to lost productivity. Linear process is no longer a competitive way to do business and in order to concurrently develop products, all information needs to be digital and it needs to be managed in PLM. […] Companies are no longer just collecting data and vaulting it. They are designing systems to get the right data. What this means on a practical level is that they are designing their PLM systems to enforce standards for data collection that ensure the right meta data is attached and that meaningful reports can be generated from this information.

PLM implementations are facing two critical problems: 1/ how to process large amount of structured and unstructured information prior to PLM implementation; 2/ how constantly curate data in PLM system to bring right data to people at the right time. So, it made me think about importance of data curation. Initially, data curation term was used mostly by librarian and researchers in the context of classification and organization of scientific data for future reuse. The growing amount and complexity of data in the enterprise, can raise the value of digital data curation for implementation and maintenance of enterprise information systems. PLM is a very good example here. Data must be curated before get into PLM system. In addition to that, data produced by PLM system must be curated for future re-use and decision making.

What is my conclusion? The complexity of PLM solutions is growing. Existing data is messy and requires special curation and aggregation in order to be used for decision and process management. The potential problem of PLM solution is to be focused on a very narrow scope of new information in design an engineering. Lots of historical record as well as additional information are either lost or disconnected from PLM solutions. In my view, solving these problems can change the quality of PLM implementations and bring additional value to customers. Just my thoughts…

Best, Oleg


Who will make PLM sexier?

July 24, 2014

sexier-plm

Cool factor is trending in software these days. The time when software was ugly is probably in the past. Everyone wants to have a "cool app" – on the picture above you can clearly see the trend. Does it apply to enterprise software and PLM? It is a good question. Back in 2012, I asked it in my post – PLM: Ugly vs. Cool. While nobody specifically focused on how to develop cool PLM software, I can see an increased interest for improved user experience from PLM vendors.

cool-sexy-app-trend

UX magazine article Is there Room for Sexy in Enterprise Design? caught my attention few days ago. I found the discussion about emotional factor interesting and important. I especially liked the following passage:

The question enterprise technology companies need to ask themselves is “what does sexy mean to your enterprise customer?” Put another way, how do your customers want to feel when using your products?Every product, whether we realize it or not, produces an emotional reaction. As Donald Norman articulated in his seminal book Emotional Design, customers find aesthetically pleasing products more effective. Customers even “love” these products. Norman identified the commercial value in evoking some passion towards products, such as Gucci bags and Rolex watches. MailChimp’s Director of User Experince, Aarron Walter, took this one step further with his book, Designing for Emotion. He posits that the goal of emotional design is to connect with users and evoke positive emotions, which will make your users want to continue interacting with your product.

Article speaks about EchoUser research of emotions with enterprise customers. The following emotions are make sense to enterprise crowd – powerful, trust, flexible, calm, pride, accomplished. Cool and sexy are not in the list. So, is there a place for "cool and sexy" in PLM? For long time PLM was associated with "complex" and "expensive". At the same time, most of PLM commercial videos are cool and sexy. Sport cars, luxury airplanes, fashion shows, mobile devices. You rarely can see PLM video without such type of product examples.

I think, many PLM professionals these days are still trying to keep the association of PLM with complexity. My hunch, they are trying to justify expenses. Customers might think complex solution requires more budget, longer consultancy and service project. However, the other side of complexity is to feel absence of reliability and trust. This is not a simple decision for PLM consultants and software vendors.

What is my conclusion? People don’t like cumbersome software these days. There is no place for complex user experience even in enterprise software. What emotions should drive CAD and PLM software? How engineers should feel about software? I’d like to connect the results of engineering and manufacturing process with PLM tools. You cannot make good products with wrong tools. So, something should happen with PLM software. Complex PLM software is a wrong tool to build future cool products. Just my thoughts…

Best, Oleg

photo credit MidoriShoes


Will IBM and Apple open doors for mobile PLM future?

July 17, 2014

ibm-plm-apple-mobile

Enterprise software and Apple wasn’t much a success story until now. Don’t take me wrong – you can enterprise execs and even IT folks are using iPhones and other Apple devices. In my view, they do it mostly for mobile email and other cools apps. However, until now, the traction of iOS in enterprise was limited. I’ve been speculating about future of iPad for enterprise PLM in my previous writing PLM Downstream – Sent from my iPad?; iPad and Enterprise PLM; 3D/PLM and iPad: Future or Baloney? At the same time, I haven’t see many Apple devices in manufacturing companies and especially shop floor, maintenance and service departments. In many situations, IT remained a strong gatekeeper.

Some good news for iOS mobile PLM developers just came yesterday. Apple and IBM announced global partnership to transform enterprise mobility. Navigate here to read IBM press news . The amount of articles and reviews is skyrocketing. I picked few of them. PC World article – Why the Apple-IBM deal matters. My favorite passage speaks about "uniqu cloud services" for iOS.

Apple and IBM announced an “exclusive” deal on Tuesday in which IBM will build a new line of enterprise-specific apps from the ground up for Apple’s iOS, aimed at companies in retail, health care, transportation and other industries. IBM will create “unique cloud services” for iOS, including tools for security, analytics and device management. It will also resell iPhones and iPads to its corporate customers, and Apple will roll out new support services for businesses. In other words, Apple and IBM are putting a full-court press on the mobile business market. And they’re doing so in a tightly wedded fashion: The companies used the word “exclusive” four times in a statement announcing the deal.

Another article from Forbes Apple – IBM Partnership: Enough To Solve Enterprise iOS Fears? caught my attention speaking about Apple relying on enterprise partners to do heavy lifting needed to sell mobile solution to enterprise.

As enterprises increasingly look to make more use of business applications on mobile devices – for a competitive advantage in flexibility and productivity – manufacturers such as Apple will rely on enterprise partners, he notes, “to do the heavy lifting that will increasingly be required in areas such as mobile application development, lifecycle management and systems integration”. Apple is likely to seek other partners, similar to IBM, that can also provide enterprise capabilities and support.

Let’s go back to PLM vendors and mobile development. Until now, I had a mixed feeling about PLM mobile story. All PLM vendors did something for mobile and iOS. But, in my view, it was some sort of checkmark – "yes we have it". In my view, one of the mission points was absence of specific apps to solve productivity problems. Most of mobile PLM apps did the same job as non-mobile software did, but on iPad. In addition to that, 3D viewer app was very popular. Most of these application came as an overlap to existing software. At the same time, key advantage of mobile app is to provide productivity apps for situation when users are off desks on the road, workshops, manufacturing and service facilities. Some of my thoughts about that are here – Mobile PLM gold rush: did vendors miss the point?

What is my conclusion? Apple and IBM agreement could be a big deal. IBM have a very good past record in enterprise PLM deployments. Even manufacturing industry was not specifically mentioned in the press release, I’m sure it will influence decisions of many IT managers. So, sounds like an opportunity. iOS developers can start looking for jobs in PLM companies. It is also a good opportunity for startups. Just my thoughts…

Best, Oleg


Security and permissions are showstoppers to adopt search

June 25, 2014

search-top-secret

Search and information discovery is a big deal these days. Inspired by Google and other web search giants, we want information at our fingertips at the right time. I’ve been following topic of search long time. You can jump on few of my previous articles about search – Oslo & Grap – new trajectories in discovery and search; Why engineers need exploratory search? and Pintrest will teach CAD companies to search.

You may think cost and complexity are top problems of search technologies. Crunching lots of data and connecting relevant information requires application of right resources and skills. You will be surprised, but there is one more element that drives low adoption of search in manufacturing companies – security.

Information age articles Enterprise search adoption remains low – survey speaks about survey done among 300 Enterprise IT professionals conducted by Varonis Systems. According to this survey – enterprises are afraid good search solution will allow to people o find information with no permission. Here is the passage which explains that:

The respondents were surveyed at two major security-themed industry events, the RSA Conference in February and Infosecurity Europe in April. When asked to choose the biggest obstacle to enterprise search adoption, 68% cited the risk of employees locating and accessing files they should not have permission to view. Further, even if an enterprise search solution perfectly filters out results based on established permissions, the majority of respondents indicated they are not confident that their organisation’s existing permissions are accurate. Additional obstacles to enterprise search adoption most commonly cited were accuracy of the results (36%), end user adoption (29%) and the ability of solutions to scale enough to index all the data (24%).

It made me think about complexity of manufacturing companies and enterprise organization in general. Established permissions are part of the story. The search results permissions are as good as data that enterprise systems are supplying to search software. GIGO (Grabage in, Garbage out). For many IT organization, management of security and permissions is a big deal. Think about typical manufacturing company. Tomorrow, search system can find all CAD files that were occasionally copy/pasted in different locations and shared between organizations outside of existing PDM/PLM tools. What else, multiple "publishing solutions" created variety of published copies in different formats. Add SharePoint and similar technologies sometimes adopted by divisions against approvals of central IT. Good search solution can be a litmus test to many IT organizations.

What is my conclusion? Manufacturing enterprises are complex. As I described, it driven by strategic, political and cultural lines. Search is disruptive technology that has a possibility to cross these lines and expose many elements of corporate IT problems. So, once more, we learn that only mix of technological and people skills can solve the problem. Strategists and technologist of search vendors should take a note. Just my thoughts…

Best, Oleg

[categories Daily PLM Think Tank]


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