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Product lifecycle management market evolves toward collaboration, cloud computing and CPDM

The product lifecycle management (PLM) software market is undergoing significant changes, including the addition of collaboration tools, cloud deployments and even a new name.

Manufacturing IT professionals need not worry if they feel they aren't "there" yet with product lifecycle management...

(PLM). Experts say the current PLM market is not so much an end state as a process of evolution.

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The discipline itself is evolving -- and today, many companies continue to refine what PLM software means in practice, explained Ken Amann, director of research at CIMdata, an Ann Arbor, Mich.-based consultancy. There is a wide range of PLM maturity, he said. The aerospace and auto segments are far ahead in their PLM sophistication, while other sectors are just starting to gain traction.

"PLM techniques are now expanding more into consumer packaged goods and even into non-manufacturing areas such as financial services and health insurance," Amann said. "In every instance, companies simply want a better way to manage information, and they are seeing PLM technologies as a means for doing that."

PLM has changed in the last 20 years, Amann explained. It grew out of the early investments in CAD, when many product data management (PDM) practices were first developed and early integration work began with enterprise resource planning (ERP) systems.

"When all of this started in the 1980s, the focus was mostly on file management," he said. "But, as we have learned, it is also critically important to manage the processes."

Thus, the PLM market today is focused on how to create common repositories and share information in a controlled way, Amann explained. Collaboration is crucial and it needs to "span everything," he said. It is about how to get people to talk and share automatically as part of an ongoing process. It is about ensuring that designers and manufacturing people can communicate successfully. It is about finding ways to more easily conduct actions such as a design review session involving multiple stakeholders. That's why some vendors are moving toward new functional and interface capabilities, leveraging Web 2.0 capabilities.

"We expect to see the development of more PLM capabilities that mirror the interaction paradigms of consumer phenomena such as Twitter and Facebook," Amann said.

SaaS, cloud-based delivery compelling for PLM market

Another key trend to watch is the emergence of software as a service (SaaS) or "cloud" computing paradigms, which may make PLM software easier and more affordable for some organizations, according to Joe Barkai, practice director with Framingham, Mass.-based Manufacturing Insights. These delivery models are a compelling PLM option when design and manufacturing happen in separate locations, and perhaps in separate companies and countries, because they simplify access and sharing.

"[SaaS] is moving fairly rapidly from bleeding edge to mainstream," Barkai said.

In fact, there are mature SaaS offerings from PLM vendors, but he said adoption is slow and inconsistent in part because of "exaggerated concerns about security" and level of service. Vendors themselves aren't always doing a good job of selling these options, he said.

"Vendors have matured the software but not their pricing models and sales approach, and are therefore not effective in positioning the value," Barkai explained.

The trend toward SaaS may have a hidden benefit, however, even for companies not interested in the model, according to Amann. Some on-premise PLM software vendors are choosing to shift away from a pure license model, in which maintenance is treated as a separate expense, toward a bundled model or "recurring license" that includes maintenance. These new licensing options can offer a better value to some companies, he said.

Barkai noted that the drive toward PLM systems adoption is reaching down to smaller companies both because the entry cost for acquiring PLM is coming down and because the value of product information is growing. In addition, he said, larger firms will begin to demand PLM adoption by their suppliers, further driving adoption.

PLM terminology maturing, too

As the PLM discipline has matured, so has the terminology. Some, including CIMdata, now use the term collaborative product definition management (CPDM). CPDM includes traditional product data management (PDM), along with collaboration, visualization, collaborative product development, enterprise application integration, and supplier management, Amann said.

To evolve or implement PLM capabilities, Amann recommended that organizations first look at what they already have in place and determine what the next steps should be to share information and work together more effectively and then determine what additional tools are needed. Each company is different, he said, and there are always new areas that can be brought within the PLM envelope.

"Companies need to figure out how best to broaden their use of information and stretch it across the different areas of the business," Amann said. "Architecturally, they need to look at how these [different tools] are built, how they fit with other elements, and whether they are compatible. In other words, this should all work to manage complexity and make things work better."

About the author: Alan Earls had his first exposure to computer programming on one of Digital Equipment Corp.'s PDP-8 minicomputers. He went on to serve as editor of the newspaper Mass High Tech and is the author of the book Route 128 and the Birth of the Age of High Tech, a photographic essay on a key part of Massachusetts economic history. He currently is a freelance writer, covering many aspects of IT technology and writing regularly for SearchManufacturingERP.com.

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