The Role of PLM in Hollow Corporations

February 5, 2014

plm-global-business-trend

Do you know what means "hollow corporation"? My readers from UK and Europe should be familiar with the term. This is a model for a company that outsource majority of their production activity. A compatible U.S. buzzword is "virtual business". There are few references defining what is "hollow corporation". Business glossary here defines it as a business in which "important elements are outsourced to subcontractors". Ten years old article brings the main two drivers behind the Hollow Corporations trend – globalization and technology. Here is the passage I liked:

Component tasks can be performed anywhere in the world. People in diverse parts of the globe working on common technology platforms provided by Microsoft and Google can now share work product seamlessly. They can communicate easily and cheaply across long distances due to undersea fiber optic cables. Through technology, distance between workers is no longer the limitation it was once.

However, I can see virtual corporation trend goes much beyond tech companies such as Google and Microsoft. Wikipedia link to "virtual business" brings another set of definitions I found useful. Among few of them "virtual enterprise" is the most interesting:

A virtual enterprise is a network of independent companies—suppliers, customers, competitors, linked by information technology to share skills, costs, and access to one another’s markets. Such organizations are usually formed on the basis of a cooperative agreement with little or no hierarchy or vertical integration. This flexible structure minimizes the impact of the agreement on the participants’ individual organizations and facilitates adding new participants with new skills and resources. Such arrangements are usually temporary and dissolve once a common goal is achieved. A virtual enterprise is rarely associated with an independent legal corporation or brick and mortar identity of its own.

The pioneers of virtual business came from internet space. You may think about Amazon and other virtual booksellers as an example of very successful virtual businesses connecting buyers and sellers only by using technologies and internet. However, I can see manufacturing companies are actively embracing virtual corporation space too. In my view, expression "hollow corporation" is getting new meaning these days in manufacturing world. Company like Nike took a new type of relationships with suppliers and created a new type of business. Many other manufacturers across the globe took the concept of delivering new innovative products combined with high efficiency of supply chain networks.

The last fact made me think about future role of PLM in such type of corporations. Typical vertically integrated manufacturing company is centralized around manufacturing planning control (MPC) system. This is a central place and main system in manufacturing universe. These days MPC functions are typically implemented as part of commercial ERP systems. The main purpose of vertical integration is to put manufactured products out of production lines. With new concept of virtual corporations, the manufacturing center of gravity is moving towards suppliers and outsource manufacturers. It puts product development in focus and makes a lot of sense to bring PLM system to manage design, product portfolios, configurations and coordinate it with customer demand and customer focus.

What is my conclusion? Industry landscape is changing these days and it brings new requirements for computer systems in engineering and manufacturing. Vertically integrated manufacturing model is changing towards more flexible networks that can react fast on customer demands. I can see a clear trend towards optimizing supply chain networks and outsource manufacturing facilities. Customers want more specialized products, lower cost and fast delivery. It brings new challenges for manufacturing and opportunities for PLM systems to establish new type of product development. Just my thoughts…

Best, Oleg


PLM and development of industrial internet

January 10, 2014

industrial-internet-plm

Management of product data was always a first and most important imperative for PLM solutions. Depends on vendor strategy and various historical reasons, vendors are focusing on different dimensions of data – CAD design, bill of materials, manufacturing data, supply chain, etc. Regardless on the priority and marketing differentiation, any PLM solution today is trying to cover all data dimensions I mentioned above.

The ease and flexibility of data management is what makes some PLM solutions shine better than others. At the end of the day, customers are expecting PLM solution to provide out-of-the-box yet flexible data model to support CAD, Bill of Material, Part, ECO, Simulation and sometimes other data as well. The last one (Simulation) was actually very challenging piece for PLM vendors. To manage significant amount of simulation data together with CAD and BOM data is not a simple tasks. Some vendors built simulation process management solutions for that purpose.

However, PLM vendors might be caught by something unknown and unexpected. New tsunami of data is expected in manufacturing world. Yesterday, I was talking about IoT trend here. Earlier this morning I was drinking my coffee and skimming Manufacturing Trends to Watch in 2014 article. One of them, caught my attention – The ‘Industrial Internet’ Will Flourish. Here is the passage I specially liked:

If you think the data generated by today’s back office, MES, control, supply chain, and warehouse management systems is overwhelming, just wait. Increasingly, manufactured products from cars to airplane engines to medical devices are being outfitted with sensors and Internet connectivity that allow them to broadcast back to manufacturers information on things like how they’re being used and why they broke, and when they need to be serviced. In fact, it’s estimated that, by 2020, 40% of all data generated will come from such sensors. GE calls this trend the Industrial Internet and estimates that it will add between $10 trillion and $15 trillion to global GDP in coming years.

It made me think, PLM data architecture can be challenged by the wave of data that can be compared to Google and Facebook scale. To process, store, access and analyze this data will take time and resources. Traditional SQL databases will be probably not an ideal solution, which brings me back to my writeup about PLM and Data Management in 21st century.

What is my conclusion? The amount of data is growing exponentially. Soon we will be coming to Yottabytes of data. Industrial internet alert should be a wake-up call for many PLM vendors to think about future data architectures. Just my thoughts…

Best, Oleg

* image credit to trainordaviesdesign.com


PLM and Unknown Unknowns Use Cases

April 30, 2013

Recent tragic event in Boston, raised again the question about critical role of real time information integration. You may think, it is not something that related to engineering and manufacturing software. Until recent time, I’ve seen it exactly in the same way. However, with the latest trends in the developing of data and information systems, I can see how big data, data analytic and analyzes can be used by business enterprise software too. Getting back to events of 9/11, Donald Rumsfeld, US Secretary of State for Defence, stated at a briefing: ‘There are known knowns. There are things we know that we know. There are known unknowns. That is to say, there are things that we now know we don’t know. But there are also unknown unknowns. There are things we do not know we don’t know.’ Originally “unknown unknowns” statement was considered as a nonsense. However, if we think twice, the concept of unknown unknowns might be relevant to many companies in manufacturing.

One of the key roles of PLM these days is to help companies to innovate. There are some many definitions of “innovation”. You can think about innovating organization, innovative processes. Here is the thing. Most of companies these days are afraid about how not to get “surprised” by innovation coming from unknown innovators, competitors and other factors – new economic condition, financial impacts, new product segments, cross domain innovation, etc.

In my view, the key element of preventing “unknown unknowns” impact is to get better analyzes of the data in your company and outside. Companies owns a lot of data business data, stored in databases and mainframes behind the firewall. This is “known knowns” because in this area business decisions are generally made based on historical data. This is where PLM/PDM operates today. There are lots of data that mostly unstructured and resides in emails, blogs, internet, websites, etc. This is a place of “known unknowns”. Companies dealing with big data and some others are trying to solve today. The biggest danger is coming from unknown unknowns. We need a solution to fix it.

What is my conclusion? There are many things that can influence manufacturing organizations. We live in a very dynamic world. Market conditions are changing, new competitors are entering market in a very disruptive way, financial market influence, employees turnover. These are “unknown unknowns” of PLM and future innovative solutions software vendors can come with to market. Just my thoughts…

Best, Oleg


PLM priorities and Gartner IT’s Top 10 Tech Trends for 2013

November 2, 2012

As we move towards the end of the year, we will see more posts with trends’ reviews for 2013. While it is really hard to predict “next big things”, these posts usually provide a good perspective on what is going on. Earlier this week, my attention caught by Gartner’s Top 10 strategic tech for 2013 publication. Navigate to the following link in PC Magazine Forward Thinking publication to review details. You can see the picture with top 10 techs below.

It made me think about some interesting intersections of these trends with the priorities of engineering applications and specifically PLM technologies and systems.

Mobile Technologies and HTML5

The question about what will become a preferable technology for mobile and web browsers will continue to be dominant in PLM development eco-system. The complexity of the systems is high. Therefore, vendors will be slow to adopt every change. I believe vendors will try first to concentrate on the supported versions of browsers. Old browsers are easier to reject. Native mobile apps is something more complicated. Most of consumers prefer native mobile apps and not browsers. Therefore, the improvement of HTML5 technologies can be an advantage for PLM vendors considering mobile options.

Enterprise App Stores

Introducing of cloud and mobile apps is raising a question about the future of application distribution. IT will need a tool(s) to distribute new type of application in organizations. App store is a fascinating idea and the majority of people these days actually “got this”. In my view, the challenge will be to balance between chaotic nature of consumer app stores (Apple, Google) and more structured way enterprise IT wants to distribute application to customers. PLM vendors traditionally survive from a problem how to expand usage of PLM tools in organizations. So, App store can be a good idea to fix it.

Internet of Things

This is very fascinating topic. You might be interested to read one of my earlier blog posts. We have more products (things) that connected to the network and starting to communicate online. How it can be connected to PLM? In my opinion, the connection is in a ‘lifecycle’. Today PLM is heavily involved into design and engineering. Less in manufacturing. However, what about the lifecycle of the products after they’re built in a factory and sold, delivered to actual customers. This is a space we are going to discover in a near future. iPhone controlled bulbs is just a beginning.

Hybrid IT and Cloud computing

Traditionally, companies are working with IT departments to get things done. PLM is not different in that sense. Servers need to be configured, routers connected, software installed and updated. This is how a traditional eco-system looks like. At the same time, cloud is coming, which means no servers, no software, no updates. Even if cloud software will become widely adopted, companies will be running a lot of applications and software on premise for a very long period of time. So, how IT will be re-organized around this environment? How we will consume our “granular PLM apps”?

Strategic Big Data

There are lot of confusion around Big Data topic. Here is the big data definition from Gartner’s report – Cearley continued to define big data as dealing not just with volume, but also with variety, velocity, and the complexity of data an organization is dealing with. He talked about managing both internal and external data, and talked about how technologies such as Hadoop may be a big part, but only a part, of it. Big Data certainly open horizons to get more information about product and improve quality of the products from the standpoint that cannot be achieved now.

What is my conclusion? In my view, enterprise software technologies are going through a significant change now. Many software systems in engineering and manufacturing sector are approaching end of their lifecycle. It is a time for vendors to provide new cost-effective solutions targeting new user experience and different IT eco-system. Cost and user experience is one segment where lots of improvements can be made. Another one is data – customers will be actively looking for additional information about products and customers. Just my thoughts…

Best, Oleg


PLM, Cupcakes and Blind Spotting

June 19, 2012

Let me ask you this… Is there a connection between PLM and Cupcakes? I hope I’ve got your attention for a minute :). One of the questions PLM industry is struggling for a long period of time is awareness. PLM long time industry opponents ERPs are well positioned to get attention of CIOs and other executives in the companies. At the same time, speak to any PLM-related person about PLM awareness, and you will be immediately attacked by a long list of facts that supposed to convince you PLM is the first thing you need to implement in order to improve your business. Getting back to the original question about PLM and Cupcakes, one of my best blogging and twitting buddies, Jim McKenney posted in his PLM on my brainfew months ago an interesting blog post called – Who needs Product Lifecycle Management? The following passage is my favorite:

People seemingly cannot agree on who really needs Product Lifecycle Management, or PLM.  What is my response? EVERY business needs PLM! Why, you ask, well, let me tell you. Every business has a large pile of information that supports their products. It may be in the form of paper, but thankfully today, most businesses have a large amount of digital information that supports their business. Managing that virtual information is what allows the company to continue delivering products and support to their customers. PLM is all about managing virtual information to support physical products.

Later in his post, Jim is coming to the “cupcakes story” explaining why every company needs PLM. You can replace “cupcakes” with anything else – cars, airplanes, computers, food, etc. and it won’t change a story. The fact how people convinced themselves about the need of PLM is interesting to observe. As a result of this, PLM solutions’ appetites are growing, and many additional solutions become part of PLM portfolios.

Another thing that very often came in conversations about PLM is “change”. The company must change their processes, behaviors, organization, systems, etc. to successfully implement PLM systems. Another PLM blogger I admire – Jos Voskuil often writes about people’s aspect of PLM. In one of the last posts in his virtualdutchman blog – The State of PLM after 4 years blogging Jos is saying: I believe PLM requires a change in an organization not only from the IT perspective but more important from the way people will work in an organization and the new processes they require.

The aspect of change and the question about PLM awareness made me think about “blind spotting”. Everybody knows what is blind spot when you drive your car. However, this is not exactly what I want to talk about. I’ve got my exposure to the topic of blind spotting two years ago during COFES 2010 when I attended a lecture of Peter Marks about the same topic. I put a video record of this session. It is longer than a usual video I put in my posts. Keep it for coming 4th of July week and watch it. I’m sure you will learn a lot as I did.

Peter Marks lecture about Blind Spotting at COFES 2010

Just to capture an idea of what Peter Marks is talking about I want to refer you to the article where Peter is answering 3 questions about blind spotting. Navigate here and have a read. Here is the question that caught my special attention. Peter is talking about what blind spot will make a biggest difference to us:

It’s probably the extension of our innate territoriality to territories of belief. This often leads to irrational escalation of conflict. As with many other animals, we’re wired to defend our territories.  Home territories are where we find sustenance and protect our kin.   Over the millennia, we’ve evolved many biases to give us a “home field advantage.” Today, the notion of defending a physical territory has extended to “territories” of belief and culture.  The functional silos in most medium size and larger organizations are a mild form of this territoriality.

I found it resonating to the topic of PLM territory :). I hope you’ve got my point. It is about how to organize the territory of automotive manufacturing company, high-tech company and… finally, cupcake company with the way PLM is pretending to make their business. This is where a second blind spot mentioned by Peter caught my special attention -

Q: What is the biggest blind spot you overcome yourself? One thing I’ve become more aware of is how the “confirmation bias”  affects me.  Most of us, myself included, are confident in our own beliefs.   When challenged, we start looking (only) for evidence that supports our opinion.  Early in school and in my career, my knee-jerk reaction was to bury contrary opinions in an avalanche of facts.

What is my conclusion? I found “blind spotting” as an interesting association to look on what is happening around PLM these days. We’ve been very long-time believers of “know how” to make companies to use PLM software. I have to say, we’ve got certain achievements in how we did it. However, PLM software didn’t make it to the mainstream adoption similar to accounting, CRM and some of ERP functions. The market situation these days is very disruptive- cloud, social, different so-called “2.0 trends”. It is important to overcome traditional PLM blind spot in order to see what the shift PLM industry needs to take to go beyond its current potential. Just my thoughts…

Best, Oleg


PLM and the death of complexity

April 24, 2012

The complexity of engineering and manufacturing software is a well-known fact. The topic isn’t really new. For the last couple of years the complexity topic came to me in different context and various forms. Two weeks ago, I was writing about that in my blog – PLM: Data, Search and Future User Experience. If you haven’t had a chance to read it, please take a look.

One of my working hypotheses these days is that consumer market and consumer software provides a significant injection of ideas for user experience. In parallel consumer behaviors of web and other software are changing state of mind of many end users. I was reading an article outline from Gartner about consumer trends that impact technology. I found this write up quite interesting. Navigate your browser to the following link to read it – Gartner Outlines 10 Consumer Macro Trends to Impact Technology, Media and Service Providers for Next 10 Years and have a read. This passage is my favorite one.

Market Trend No. 9 — The Death of Complexity

The consumer market is becoming progressively less tolerant of complexity. Although consumers tend to buy products with ever-richer features, they often prefer those that are simple and intuitive. The ability to provide appealing and intuitive user interfaces has become a critical point of differentiation among competing technology providers. As technology becomes more complex, vendors need to invest more in keeping the user interface simple and intuitive. T&SPs therefore need to focus on simplifying technology, pricing, brand messaging, and feedback and interaction, and consider offering chargeable help services for consumers challenged by installing and configuring new equipment and services in their homes.

It made me think that fighting complexity will be one of the most critical elements of the future CAD/PLM vendor strategies. I was looking on what CAD/PLM companies are doing these days. I can summarize it in the following 3 directions:

1- Leverage OS user experience.

This direction was very popular in the past. In the world of Microsoft Windows dominance, to adopt OS user experience and make your application transparent is an interesting decision. It started from leveraging File Explorer UI and continue towards deeper integration with Microsoft Office, SharePoint and other systems. The examples are SolidWorks EPDM, PTC Windchill and few others.

2- Mimic successful web application in consumer market

Web is the source of inspiration for many startup companies and well established brands in CAD / PLM. The most popular elements of use experience that companies have tried to use were – Google search and Social Networking. The experiments presented by Siemens PLM as Active Workspace is one of the examples. Dassault came with Exalead search SBA, but I have never seen something that was delivered in this space by Exalead after DS acquisition.

3- 3D and Gaming

Because design content in CAD is visual and in many cases is 3D, companies have tried to use gaming analogies to develop the next successful user experience in this space. 3DLive from Dassault was clearly pioneering in this space by delivering their 3DLive. These days, I want to mention Siemens PLM Active Workspace. It is another interesting experience of mixing of 3D and search experience.

What is my conclusion? The death of the complexity is here. PLM and other software vendors in the manufacturing and engineering space need to take a note. The user experience will not be set by enterprise monsters. New generation of people will not tolerate the complex PLM software. This is a time to rest the expectations. Just my thoughts…

Best, Oleg


Product Lifecycle Management and Obsessive Taxonomies

March 26, 2012

I’ve been reading tweeter stream during my short weekend at home. One of the tweets from Randal Newton caught my special attention. This is the message:

This message made me think about PLM systems, taxonomies and folksonomies. If you’re new to this term, a short intro.Taxonomies is what you most probably know as data classification. From Wikipedia article:

Taxonomy (from Greek: τάξις taxis “arrangement” and Greek: νομία nomia “method”[1]) is the science of identifying and naming species, and arranging them into aclassification.[2][3] The field of taxonomy, sometimes referred to as “biological taxonomy”, revolves around the description and use of taxonomic units, known as taxa (singulartaxon). A resulting taxonomy is a particular classification (“the taxonomy of …”), arranged in a hierarchical structure or classification scheme.

Taxonomies are created by a single individual or a team, and it is clearly represented as hierarchical structure. Opposite to taxonomies, folksonomy presents a different way of data organization.

A folksonomy is a system of classification derived from the practice and method of collaboratively creating and managing tags to annotate and categorize content;[1][2] this practice is also known as collaborative tagging,[3] social classification, social indexing, and social tagging. Folksonomy, a term coined by Thomas Vander Wal, is aportmanteau of folk and taxonomy. Folksonomies became popular on the Web around 2004[4] as part of social software applications such as social bookmarking and photograph annotation. Tagging, which is one of the defining characteristics of Web 2.0 services, allows users to collectively classify and find information. Some websites include tag clouds as a way to visualize tags in a folksonomy.[5] A good example of a social website that utilizes folksonomy is 43 Things.

Take a look on an interesting picture presenting opposite worlds of taxonomies and folksonomies. It is about top-down and bottom-up:

I’ve been thinking about taxonomies and folksonomies in a sense of system rigidity. Most of PLM systems built with a predefined set of rules and models. It creates a certain level of resistance when it comes to the usage of the systems. Customization of systems is complicated, sometimes is cumbersome. Opposite to that, folksonomies is a model that can be “collaboratively created“. This element of collaborative creation is something that can be very much appealing to most of the engineering that like to think more flexible.

Social is another aspect. Social is trending and some companies are trying to bring it as a differentiation in PLM game these days. It would be interesting to see if social PLM and other systems pretending to be “social” are using folksonomical approach to help people to organize data within lifecycle.

What is my conclusion? PLM needs to learn new words and methods of work that prove themselves in the last 10 years of Web. Folksonomies is one of them. The rigidity of existing systems (obsessive taxonomies) need to be transformed into a more flexible and granular approach. Just my thoughts…

Best, Oleg


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