© Tech-Clarity, Inc. 2015
Product Lifecycle
Management
Beyond Managing CAD
The Business Value of
Enterprise PLM
2 © Tech-Clarity, Inc. 2015
Table of Contents
Executive Overview ....................................................................... 3
Benefits of Product Lifecycle Management .................................... *
Putting PLM in the Business Perspective ....................................... *
Battling Complexity ......................................................................... *
Combatting the Business Impacts of Complexity ........................... *
Identifying the Top Performers ....................................................... *
Adopting a Process-Centric PLM Approach ................................... *
Expanding PLM Across the Enterprise ........................................... *
Expanding PLM Across the Supply Chain ...................................... *
Explore the Relationship Between PLM and PDM ......................... *
Integrating PLM with Other Systems .............................................. *
Taking a Process versus Data-Centric View .................................. *
What about the Cloud? ................................................................... *
Conclusion ..................................................................................... 4
Recommendations ........................................................................ 4
About the Author ........................................................................... 4
About the Research ....................................................................... 5
*This summary is an abbreviated version of the report and does not contain the full
content. A link to download the full report is available on the Tech-Clarity website,
www.tech-clarity.com.
If you have difficulty obtaining a copy of the report, please contact the author at
jim.brown@tech-clarity.com.
3 © Tech-Clarity, Inc. 2015
Executive Overview
The concept of Product Lifecycle Management (PLM) software and the reality do not
always match. PLM software started as a way to expand the value of Product Data
Management (PDM) by adding additional information such as release status, BOMs, and
ECOs. But the real promise of PLM – supporting enterprise-level processes for product
innovation, product development, and engineering – offers much higher, strategic value.
So why haven’t more companies taken advantage of the benefits of process-centric PLM?
Some of the reason is historical, because most early PLM systems were really CAD data
management with some added features. But another part is simply how important good
data management is. As Tech-Clarity’s recent The Facts about Managing Product Data
shows, “PDM’s ability to help companies control, access, and share product data is a
powerful tool that helps companies improve top- and bottom-line performance.”
We surveyed over 200 companies to understand if they take
a data management or process-centric view of PLM.
PDM adds value on it’s own and is a logical starting point. But many implementations
stop there, while others continue on to support more processes. Alternatively, today’s
modern, enterprise-focused PLM systems offer the opportunity to start with processes in
the first place. So which drives higher value, a data-centric or process-centric approach?
We surveyed over 200 companies to understand if they take a data management or
process-centric view of PLM to find out. We identified the “Top Performers,” those that
excel beyond their peers in revenue growth, margin expansion, innovation, and cost
reduction, and analyzed their PLM approach to see what leads to better performance.
Process-centric, Enterprise PLM drives better business performance,
but PDM capabilities are an important value driver.
The survey results lead us to believe that process-centric, Enterprise PLM drives better
business performance, but also finds that core PDM capabilities are an important value
driver. Specifically, the survey finds that Top Performers are more likely to:
• Execute processes that go beyond the technical definition of the product to the
commercial aspects of the offering
• Leverage more advanced PLM processes including cost and quality management
• Have more departments and third parties using PLM
• Use core PDM capabilities more than “Others”
• Tightly integrate PDM and PLM
• Integrate PLM with other enterprise information systems and engineering tools
4 © Tech-Clarity, Inc. 2015
Conclusion
The data overall supports that Top Performers’ PLM implementations have some
significant differences than those of the lesser-performing Others. Specifically, they
implement more advanced processes, involve more departments outside of Engineering,
share PLM with more third parties, and integrate PLM with a host of other solutions.
The survey leads us to the conclusion that process-centric PLM drives better business
performance. But the data also clearly shows that core PDM capabilities are an important
value driver and that Top Performers are more likely to manage CAD and tightly
integrate PDM with PLM, even if it’s not a single, unified solution. The final word, then,
is that process-centric PLM can provide significant value beyond managing CAD and
product data, but that those basic capabilities should not be overlooked either.
Recommendations
Based on industry experience and research for this report, Tech-Clarity offers the
following recommendations:
• Take PLM beyond core PDM and CAD data management capabilities
• Expand PLM to more people, including management, others outside of
Engineering, and the supply chain
• Leverage PLM to support more advanced processes
• Integrate data management tightly with PLM, even if it’s not a single solution
• Integrate with enterprise solutions
• Integrate with engineering tools
• Consider cloud PLM as an option to support process-centric PLM
About the Author
Jim Brown is the President of Tech-Clarity, an independent research and consulting firm
that specializes in analyzing the business value of software technology and services. Jim
has over 20 years of experience in software for the manufacturing industries. He has a
broad background including roles in industry, management consulting, the software
industry, and research. His experience spans enterprise applications including PLM, ERP,
quality management, service lifecycle management, manufacturing, supply chain
management, and more. Jim is passionate about improving product innovation, product
development, and engineering performance through the use of software technology.
Jim is an experienced researcher, author, and public speaker and enjoys the opportunity
to speak at conferences or anywhere he can engage with people with a passion to improve
business performance through software technology.
5 © Tech-Clarity, Inc. 2015
Jim can be reached at jim.brown@tech-clarity.com. You can read additional research,
watch Tech-Clarity TV, or join the Clarity on PLM blog at www.tech-clarity.com. You
can also follow Jim on Twitter at @jim_techclarity, or find Tech-Clarity on Facebook as
TechClarity.inc.
About the Research
Tech-Clarity gathered and analyzed over 200 responses to a web-based survey on the use
of PLM systems. Survey responses were gathered by direct e-mail, social media, and
online postings by Tech-Clarity and Autodesk.
The respondents were comprised of about one-half (48%) who were manager or director
level, almost one-third individual contributors (31%), and the remainder included VP or
executive levels. The majority of the participants (69%) were from engineering
disciplines including product design / engineering, industrial / manufacturing
engineering, and plant / facilities engineering. Another 14% represent manufacturing.
The respondents represented a mix of company sizes, including 28% from smaller
companies (less than $100 million), 34% between $100 million and $1 billion, 23%
between $1 billion and $5 billion, and 15% greater than $5billion. Company sizes were
reported in US dollar equivalent.
The responding companies were a good representation of the manufacturing industries,
serving Industrial Equipment / Machinery (22%), Building Products and Fabrication
(21%), Consumer Packaged Goods (21%), Automotive (17%), High-tech and Electronics
(15%), Aerospace and Defense (14%), Consumer Products (11%), Life Sciences /
Medical Devices (10%), and others. Note that these percentages add up to greater than
100% because some companies indicated that they serve more than one industry. Just
over one-half (54%) are OEMs with the majority of the rest from the manufacturing
supply chain.
The respondents reported doing business globally, with the vast majority doing business
in North America (84%), over one-third doing business in Western Europe (35%), and
about one-third doing business in the Asia-Pacific regions (31%), Eastern Europe (15%),
and Latin America (11%). Note that these percentages add up to greater than 100%
because some companies indicated that they are active in more than one geography.
Respondents included manufacturers as well as service providers and software
companies, but responses from those determined not to be directly involved in designing
and/or manufacturing products (including software vendors and consultants) were not
included in the analysis.
