What Does Plm Stand for in Business

PLM refers to the management of data and processes used in the design, engineering, manufacturing, sales, and service of a product across the entire lifecycle.

Product lifecycle management (PLM) refers to the management of data and processes used in the design, engineering, manufacturing, sales, and service of a product across its entire lifecycle and across the supply chain. Product lifecycle management has a long history in the manufacturing space, but as it stands today, the term generally refers to a software solution and a broader use case beyond just the manufacturing process.

Why Do Companies Need PLM?

Companies that manufacture goods experience a range of issues outside of the scope of design and manufacturing. Product lifecycle management (PLM) mitigates those issues and helps align and integrate key resources, quickly making product information accessible to teams across the organization.

PLM was originally designed to help engineers collaborate on the latest product designs and control information across the lifecycle of a product. But because their technology stack was on-premise, PLM solutions focused only on internal employees. Today, product lifecycle management as a methodology has evolved to include a larger portion of the organization, including customer service, marketing, sales, suppliers and partner channels.

Because of the strong focus on engineering, original PLM solutions were built with the engineer in mind. Legacy PLM was created to help engineers increase productivity, accelerate time to market, and lower product costs. Today's next-gen PLM software includes new benefits of product lifecycle management across the entire organization and allows for faster customer responsiveness and greater customer transparency, greater product quality even for complex products, helping boost revenue and get products to market faster.

What is cloud-based PLM?

Cloud-based product lifecycle management software varies from its on-premise predecessor in that it creates a single source of truth to expedite and improve product development, and track data and processes – all from the cloud. Today's cloud PLM software updates product changes, advancements, and industry compliance as they happen in real-time, allowing for timely collaboration between all departments in the product development process regardless of location.

The evolving workforce and increase in remote employees require more robust and collaborative software systems with a better user experience to operate in today's business landscape. Most new PLM solutions have adjusted to this need and offer multi-layered communication and process management, allowing different sites, employees, and partners to collaborate seamlessly no matter where they are in the world.

Keep reading: Three Ways to Drive Organizational Intelligence with Cloud PLM

Do I need PLM?

PLM isn't just a buzzword. It simplifies, organizes, and integrates data, allowing an in-depth view of each manufactured product and how it will be received in the market, maximizing efficiency and profitability in the following areas:

Design and manufacturing integration: A company's production process may use a range of software applications for design and manufacturing. PLM can optimize the entire production process in real-time. Without PLM, valuable data may not be communicated across all these systems and people.
Product commercialization: PLM assures products are ready for global rollout, with effective, reliable data, document management and process governance. Unified data and collaborative workflows across the organization keep things running smoothly and allow teams to respond quickly when challenges arise.
Virtual environments that support global operations: PLM provides a central product data management (PDM) repository that integrates the entire global process from concept to customer.
Accessible data: PLM makes all product information available to each department, improving production efficiency and allowing for a closed-loop for all teams involved.

The Product Lifecycle and the PLM Process

A product's lifecycle typically begins with an idea. Maybe it happens in an office, maybe on your drive home or famously it happens in a garage in Silicon Valley.

When we think of products we assume that once that idea gets legs, it crystallizes into a design it is later manufactured for the world to see. But we can't forget the steps in between: purchase, service, and repair, and ultimately – disposal or retirement.

In high-level terms there are four stages to a product lifecycle:

Introduction: Costly and risky, new products that are introduced to the market can mean low sales, as well as costs from research and development, consumer reaction, and marketing.
Growth: The product gains popularity and sales and profits grow. Marketing increases to maximize benefit.
Maturity: Product popularity dictates more focused marketing as well as future predictions for product improvements or changes to the production process.
Decline: An inevitable end, decline in product popularity happens with increased competition, or lack of customer return. Companies focus on reducing production costs and introduction to less popular markets.

Product lifecycle is the progression of a product through these four stages and all of the finer grained processes, including inception, engineering, design, manufacturing, sales and marketing, distribution, service, and disposal. PLM is the management of that lifecycle, aligning the people, data, processes, and business systems that make their entire product portfolio a success. The PLM process includes the following key elements.

The Lifecycle Stages

Design

PLM brings concurrent capabilities to the table, allowing design, engineering, simulation, marketing, engineering, manufacturing, and tweaks to the entire process to run at the same time. When a product is in the design and engineering phase, PLM allows changes to happen as the design is being tested. The ability to design in real-time expedites completion of a final product, which in turn quickens time-to-market and eventual profit.

Companies often spend up to 25 percent of their revenue on new product development. Even a one percent decrease in lost time or increase in margin delivered by PLM software can significantly impact a company's profits. Companies operating in a high-tech PLM environment can easily deliver innovation, while simultaneously tracking and responding to customer feedback in real-time.

BOM Management

Bill of materials (BOM) management is at the heart of PLM. PLM connects BOMs with accurate product definitions, source information, manufacturing data, documentation, and pricing.

It's what makes up the product that a company delivers to its customers, and it can include hardware, software, manufacturing data, documentation, pricing, and more. BOM management involves engineering design, design collaboration, sourcing and procurement, and go-to-market strategy. For products to succeed in the market, companies need to make sure that BOM management also incorporates external collaboration with partners, suppliers and sales channels. BOM management is closely associated with change management since updates can happen between engineering, manufacturing and marketing as a product gets ready for sale.

The PLM integration of computer aided design (aka CAD systems) with BOMs improves processes by synchronizing engineering and non-engineers throughout the design of the product. When a CAD system exchanges information with a BOM through a PLM system, the result is better collaboration, accuracy, and in the end the one thing we really want, faster time-to-market.

Engineer-to-Order

Engineer to Order (ETO) is a specific use case of design in PLM. In this case, customers are highly involved in the design and requirements for a product. PLM for ETO provides a single, secure, easy-access solution for providing information to sales, engineering, and operations for product review, design, and delivery. In addition, it includes information that can be shared not just with engineers, but also with partners, suppliers, and customers.

Competition in the marketplace, changing customer needs, and customer satisfaction, are vital to the success of a product launch. Modern PLM software uses cloud technology to manage engineers, purchasing tools, and requests related to the ETO process. Information from partners, suppliers, and customers is then used to provide a working overview of the process to provide improved response time to customers, more accurate quotes, increased employee productivity, better product development and delivery, and customer loyalty.

Production

Lowering development and production costs, and improving time-to-market are two of the most important end results of PLM. Change management, cost management, and supplier qualification play key roles in these outcomes.

Change management is how a company deals with changes that occur during inception, design, manufacturing, and use of a product. An effective change management process organizes revisions and cancellations, keeps track of different versions of documents, and follows the workflow process. Information generated by changes along the process are crucial for communication between departments and outside partners.

Cost management is similar to change management, tracking costs involved with tools and components from the earliest stages of the product development. Cost transparency is crucial for profitability and modern PLM software can provide accuracy and cost savings that might otherwise be missed. It goes without saying that better communication and review of sourcing options are best done in the planning stages. Cost management inside of PLM gives way to this early information and allows manufacturers to evaluate and avoid possible delivery or cost issues and prevent product launch hiccups.

Distribution and Service

PLM provides tools and information about distribution and service of products. Product information management (PIM) is the phase after the product is manufactured. In order to market and sell their latest and greatest product, companies need an effective way to make sure all their sales channels are receiving and displaying the correct product information.

PIM provides companies with timely product data for sales channels, including direct sales, distributors and e-Commerce. Ideally, PIM solutions should be closely tied to PLM—or better yet, one in the same—so there can be a single repository for product data that can be used by sales and marketing as well as engineering and manufacturing.

PIM provides all the tools necessary to take product information from engineering into a saleable entity that sales teams can use to sell the product, including accurate product attributes, SKUs, and pricing.

To the same effect that marketing teams can benefit from the accurate product information provided throughout the product lifecycle. Marketing needs the most up-to-date information when generating product manuals, imagery and any other content needed for distributor portals or eCommerce platforms.

Once the product is on the market, customer satisfaction is key to survival and any other future versions of the physical good. While quality management (QMS) permeates every business process, staying on top of quality issues in the field is key for sustaining product success. Tying customer issues, quality processes, and engineering updates into a closed-loop process helps ensure that products receive positive customer adoption and repeatable steps for future product iterations.

PLM Software Must-Haves

Product lifecycle management software combines all organization and readiness tools mentioned above into one platform to manage and connect data, processes, and business systems with the people who use them. When used correctly, PLM software can increase innovation, improve productivity, get products to market faster, and reduce unnecessary expenditures on resources and time.

Data Sharing

PLM provides open information sharing between employees, partners, and customers, which works to:
Speed up planning and development in the design phase
Address complex issues in real time
Manage engineering challenges
Create a customer and product connection
Update pricing, product attributes, and sales information during product launch
Improve product viability with information garnered by sales and marketing
Enhance products with sales and service input

A PLM platform that meets data sharing needs will enhance the decision making processes for project and design review, change requests, maintenance, and support. Data sharing also streamlines processes with efficiency and better communication. Global companies need to share data around the world, and real-time access is imperative—not only with employees, but with partners and customers.

Change Management

PLM software offers important capabilities for change management, the ability for a company to manage changes and challenges that arise during the entire product lifecycle. PLM software allows companies to track product revisions, change document versions, and allows users to follow change orders from engineering, marketing, or operations. It can also provide an impact analysis with data such as inventory, market timing, and production changes, as well as keep track of workflow and approvals.

Project Management

Project management can cover the entire product lifecycle from concept to customer but is typically used for the process of developing, producing, introducing, and delivering products in a timely fashion. It assures that timelines are met, resources are available when needed, and products are delivered.

PLM software enhances project management by creating a collaborative environment from concept to the moment it is in the customer's hands. It tracks the process and progress of the product through time, assures the schedule is met, and makes sure that all the parties involved have the information they need to successfully complete their given tasks as they relate to the product.

PLM Integrations

PLM software is only as good as its ability to integrate a company's processes and technologies. PLM should incorporate a CAD design system with enterprise resource planning (ERP) and they should communicate with each other flawlessly. Customer relationship management (CRM), managing all relationships with customers, and PIM, providing the latest product information, must also work together for best results.

Data integration from the Internet of Things (IoT) gives engineers direct access to real product performance information, allowing companies to respond with unprecedented speed and accuracy.

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What Does Plm Stand for in Business

Source: https://www.propelplm.com/articles/what-is-product-lifecycle-management