PLM helps manufacturers

Zatni Arbi, Columnist, Jakarta, zatni@cbn.net.id

Remember the 1950s and 1960s when major car manufacturers like Chevrolet, Ford, Dodge, Buick, Cadillac and others introduced new models such as the Bel Airs, the Impalas, the Falcons, the Galaxies, the Fairlanes every year without fail?

In the 1970s, things started to change.

We began to see the same model offered for several years in a row before a significantly newer model appeared. Changes from one model to another within a typical series became less prominent. In fact, today we tend to see car manufacturers introducing completely new designs only every three to four years.

With cars becoming a mass product, we understand that it is no longer plausible for car manufacturers to change the design of the body annually like they did in the 1950s and 1960s. It would make the price of the cars too expensive. Besides, it would deter new car buyers, as they would only have a short one-year window of opportunity to brag about the brand new car that they had picked up from the dealer. The question for car companies now is, when is it the right time to launch a completely new model?

Today, many considerations need to be taken into account. The popularity of the current model is one of them (car manufacturers can continue to produce the same model as long as buyers still elbow each other to get hold of one). The set of advanced features of an emerging competitor is another.

Brand loyalty may not be as important as before, as today's better-informed customers know that cars now are built better and have a more-or-less similar level of trouble-freeness. How long a manufacturer and its dealers will support a certain model is now more important to car buyers.

In the past, product lifecycle seemed to have been managed more by intuition. When a certain model began to lose its market share, it would mean the time had come to go back to the drawing board.

Today, however, computers are helping to manage the product lifecycle more accurately using statistical data from a variety of different sources. A new breed of enterprise application, which connects the people who design, supply the components, build, market, provide after-sales support and services, as well as the people who buy and use a product, has now been created.

It is called Product Lifecycle Management, or PLM.

Given today's extremely fast pace and cutthroat competitive environment, product development needs to take into account a lot of information. Developers, who may come from engineering, marketing and other divisions within the same company, need to be able to retrieve relevant information quickly and efficiently.

They should now be able to use and reuse all available corporate knowledge. What are the latest technological inventions from research labs across the world that can be incorporated in their new product? What do customers actually want, or require? What were their responses, critiques and wish lists when they bought the previous product? What are the current laws and regulations concerning the company's product?

All of these need to be taken into consideration during today's product development.

Companies also need to collaborate with external suppliers and development partners, including researchers in universities around the world. Suppliers need to be asked to participate, so that the development team will have an idea what they can deliver and how much time they need before they can deliver it.

"That is why a PLM system should run on top of an Enterprise Resource Planning system," said Krishnendu Datta, SAP's Country Manager for Indonesia, "It should be able to draw data from customer relationships, from the supply chain as well as from various other sources".

SAP's PLM solution has been in use in different manufacturing environments, from DaimlerChrysler, Volvo Aero Corp., Airbus, Lockheed Martin to German-based lamp maker Osram GmbH. PLM is certainly not limited solely for use in the automotive industry.

In fact, there seem to be two slightly different types of PLM approaches that are currently in use. One such is SAP's MySAP PLM, which is being offered by the king of enterprise applications, emphasizes a seamless integration of engineering, design and manufacturing processes all the way to marketing, sales and support services.

The other type seems to focus more on computer-aided design, engineering and manufacturing (CAD/CAE/CAM). One good example is CATIA and ENOVIA solutions, which are offered jointly by IBM, Dassault Systemes S.A. and the latter's wholly-owned ENOVIA Corporation.

CATIA, as we know, is an engineering solution widely used in product design, analysis and optimization. ENOVIA provides the communication solutions that distribute the model of the digital product throughout the enterprise.

Another term that has also been increasingly used is Product Lifecycle Automation, or PLA. One company behind this name is MS2 (www.ms2.com). This company's solution, called MS2 Accelerate, concentrates on helping companies define, develop and market new products and services quickly.

Certainly, regardless of their individual strengths, one of the key features in a PLM system is collaboration, which enables developers from various parts of the world to work together on developing a new product. Other key features include, of course, workflow and data management.

What can companies achieve with the help of a PLM system?

Clearly, they can shorten time-to-market, reduce development costs, offer products at more competitive prices and give us products that we really like. Unfortunately, though, the PLM system is still in its early days, so it is still unlikely that we will be seeing Honda launch a markedly different Accord at every annual car show.