State of the PLM Industry - MetaLinc · 2007-05-27 · Management ERP PLM Product/Plant Process Definition People, Finances, & ... untapped opportunity within discrete industries

Copyright © 2003 by CIMdata, Inc.

®

State of the PLM IndustryEd Miller, President

PLMconference2003Dearborn, MI, USA

June 23, 2003

Copyright © 2003 by CIMdata, Inc. - 2

Agenda

Business challenges drive PLM investments PLM provides a broad business approachTrends reflect industry evolution & maturingSuppliers respond to industry demands


Current Business ClimateWorldwide economy continues to challenge companies

Global economy causes conditions to quickly ripple through market & companiesBoth internal and external factors drive decisions and actionsIncreased pressure/motivation to improve business success, or loseLowered tolerance for ineffective programs


Investment Decisions Evolve Major investments are “enterprise” driven, and decided by executives

Companies are seeking bottom-line improvementsEconomic conditions push investment decisions higher in organizations (e.g., CxO)Product-focused investments gain visibility & momentumPLM is a broad-focused approach to drive product & process innovation and improvement


Goal of Product-Focused InvestmentsProduct and process innovation improves business performance

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$¥€

¥ €Profits

Loss Time

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Faster Time to

Production

Faster Time to

Production

Introduction

Cost Reduction

Cost Reduction

Larger Market Share

Larger Market Share

Increased ProfitabilityIncreased

Profitability

--

Managing the complete product Managing the complete product or plant lifecycle is critical!or plant lifecycle is critical!

The Product/Plant Lifecycle

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More efficient in service operation

More efficient in service operation

Premium Pricing

Premium Pricing


Success Requires A Holistic SolutionAll aspects of a the lifecycle must be considered and integrated

Products, facilities, servicesHow they are produced, operated and maintained

• Physical assets and processes

What information and resources are required• Intellectual assets

CustomersWhat they want, need, and their business issues

Partners and suppliersWhat they contributeHow you work together


PLM Focuses on Product DefinitionThree processes comprise the overall product lifecycle

Product Definition creates intellectual assets

ConceptConcept End of LifeEnd of Life

ProductDefinition

ProductProduction

OperationalSupport

Product Production creates deliverable assetsOperational Support people, finances, & facilities

Collaborative interaction among the lifecycles enables business and product innovation


Value of Intellectual AssetsClarifying the value of PLM is critical, and is still a major issue

Cost reduction is still the primary justification for most investmentsPLM impacts major financial measurements

Income statement – increases sales & profitabilityBalance sheet – outsource non-core competencies and reduce fixed assetsMarket Valuation – innovative & high-quality products increase brand value

Clarifying value is a critical component of all PLM programs

PLM solution suppliers focus on identifying valueCIMdata’s (and others’) methodology quantify value


Investment ImbalancePLM has not received appropriate level of investment

Investments have concentrated on product production & operation support

ERP, SCM, CRM, HR, Finance, …Easiest to understand – physical & delivered assetsEarliest addressed by IT/process support

Greatest opportunity for major gain is through product definition improvement

PLM – cPDm, authoring, collaboration, …Focused on intellectual asset managementDefining and improving processes


Agenda

Business challenges drive PLM investmentsPLM provides a broad business approachTrends reflect industry evolution & maturingSuppliers respond to industry demands


PLM – The DefinitionWhat is Product Lifecycle Management

A strategic business approach that applies a consistent set of business

solutions in support of the collaborative creation, management, dissemination,

and use of product definition information across the extended

enterprise from concept to end of life –integrating people, processes, business

systems, and information.

A strategic business approach that A strategic business approach that applies a consistent set of business applies a consistent set of business

solutions in support of the collaborative solutions in support of the collaborative creation, management, dissemination, creation, management, dissemination,

and use of product definition and use of product definition information across the extended information across the extended

enterprise from concept to end of life enterprise from concept to end of life ––integrating people, processes, business integrating people, processes, business

systems, and information.systems, and information.


PLM – The DefinitionPLM – integrating people, processes, business systems, and information

Strategic business approachNOT just technologiesApplies a consistent set of business solutions

Collaborative creation, management, dissemination, and use

All product/plant definition information • MDA, AEC, EDA, CASE, analysis, documentation,….• Management and manufacturing processes• Operations and service/maintenance

Supports the extended enterpriseSpans from product/plant concept to end of life


Evolution of Lifecycle View Enterprise perspective expands the industry’s view of the lifecycle

DefinePlan ServiceProduce

Enterprise PDM

Portfolio/RequirementsManagement MPM – Digital Mfg.

Early PDM

Strategy

Sourcing Operations andField Service


Role of PLM in the Product LifecyclePLM focuses on management of the product/plant definition

Use/Support/Maintain

CAD Design/Engineering

Production

Project Management

Manufacturing

Develop Product

ProduceProduct

Market/ Sell

Customer Service

Mfg. Engineering

Portfolio Management

ResearchRequirements Management

ERPERP

PLMPLM

Product/PlantProduct/PlantProcessProcess

DefinitionDefinition

People,People,Finances, &Finances, &

FacilitiesFacilities

PartnersPartners

SuppliersSuppliers

SCMSCMCustomersCustomers

CRMCRM


Major IT Domains EvolveIntellectual vs. deliverable asset management – Today

Intellectual Assets

Design ChainCollaboration

Portfolio/Rqmts.Management

Supply ChainLogistics

Orders/ServiceForecasting

Custom

ers

Partn

ers

CRMCRM PLMPLM

SCMSCMERPERP

Deliverable Assets






Two Major IT Domains EmergeIntellectual vs. deliverable asset management – The Future

Intellectual Assets

Deliverable Assets

Custom

ers

Partn

ers

ERMERM

PLMPLM

Context-oriented

Transaction-oriented






Other Initiatives Align Intellectual vs. deliverable asset management – The Future

Logistics &Maintenance

Service/Maint.Content

SupplierRelationship

SourcingLogistics

Intellectual Assets

Deliverable Assets

Custom

ers

Partn

ers

ERMERM

PLMPLM

Context-oriented


Service

Service

Sourci

ng

Sourci

ng


Logistics &Maintenance

Service/Maint.Content

SupplierRelationship

SourcingLogistics





Other Initiatives Align Intellectual vs. deliverable asset management – The Future

Intellectual Assets

Deliverable Assets

Custom

ers

Partn

ers

ERMERM

PLMPLM

Context-oriented


Definition Lifecycle

Production Lifecycle


Agenda



Industry Evolution – PLM CredibilityRecognition of PLM’s value is increasing significantly

Major software suppliers have created a major focus on PLM – gaining executive attention

EDS, IBM, SAP, …

Major systems integrators & consulting firms have created WW PLM practices – gets attention

Accenture, EDS, IBM, T-Systems, Deloitte, CAP, …

General market community drives additional attention and focus on PLM as critical


PLM Investment Forecast 2003-2007Investments in cPDm will outpace investments in tools

$0

$5,000

$10,000

$15,000

$20,000

$25,000

2000 2001 2002 2003 Est 2004 Est 2005 Est 2006 Est 2007 Est

US

$ M

illio

ns

Authoring & Analysis Tools, e.g., MCAD, CASE

cPDm, e.g., PDM, collaboration/visualization

Revenues presented are CIMdata estimates


cPDm Investment Forecast 2003-2007Total investment = software + maintenance + services

$0

$1,000

$2,000

$3,000

$4,000

$5,000

$6,000

$7,000

$8,000

$9,000

$10,000

1998 1999 2000 2001 2002 2003Est

2004Est

2005Est

2006Est

2007Est

US

$ M

illio

ns

ServicesSoftware MaintenanceSoftware

Note: Software Maintenance was not measured prior to 2001 and was embedded in either software or services



PLM Expansion – Mid-MarketMid-sized companies become active PLM investors

Technologies capable of supporting mid-sized companies now exist

Cost-effective & deployable technologies

Industry is now experienced enough to provide “best practice” guidance

Pressures to use “outside” resources, instead of hires Fixed-price support opens opportunitiesPackaged solutions are critical

Mid-market companies demand faster results… and are often capable of achieving them

(more nimble, and more focused)


PLM Implementations – Today Current PLM implementations address core issues

Basic PDM is still the primary starting pointPDM is the “heart” of PLM implementations

Collaboration across the (extended) enterprise to harmonize processes is high priorityCAx & EDA & CASE integration into the overall PLM solution is critical – the “complete” productProgram Management support within PLM is dramatically improved


PLM Implementations – EvolutionPLM implementations touch more of the enterprise

Digital manufacturing, MPM, is a growing and critical issueService/maintenance is a growing priority in some industriesCustomer intimacy should be leveraged to drive product directions (“extended” CRM)Asset management as a part of PLM is an untapped opportunity within discrete industriesRecipe management in process industries is receiving increased attention


Agenda



Evolution of PLM – Supplier ImpactThe collaborative backbone for business innovation and performance

Incr

easi

ng V

alue

Time1985 1990 1995 2002+

CostCustom ImplementationsFocus - Data and Technology

QualityToolkits and Generic ApplicationsFocus - Functions

Time-to-Market Business ApplicationsFocus - Processes

Innovation Business SolutionsFocus - The Bottom Line

CAD Data Management

Product/Plant Data Management

Product/Plant Lifecycle Management


Current Economy – Supplier Impact Worldwide economic conditions stress suppliers

Revenues have been negatively impactedFlat/low(er) growth in many casesSignificant portion of growth is in services (reflects client commitment – good news!)Depressed stock prices

Increased focus on clear justification (ROI)Formal programs from all major suppliers(e.g., PTC’s Roadmap)

Pressure to “share risk” with customersStressed organizationsConsolidation


PLM Market Evolution – ConsolidationIndustry consolidation drives changing relationships

Industry “mindshare” dominated by fewerLifecycle-focused PLM suppliers

• EDS, IBM/Dassault, PTC, SAP, MatrixOne

Partnerships/alliances expandAlignment of focused suppliers & “broad” programsSystems integrators and consulting firms align more formally with technology suppliersInteroperability between programs is more critical


PLM Market – Supplier Positioning Significant differences evolve among suppliers

Major philosophy differences among suppliersDesign-based vs. production-based approachLifecycle-based vs. model-based approach

A few key battlegrounds emerge – expansionDigital manufacturing, or MPM, is already criticalService/maintenance is gaining exposurePortfolio/requirements mgt. is key

Industry-focused solutions drive and differentiate suppliers

Automotive, electronics, CPG, process, …


2002 Mindshare Leaders Revenue SplitsUnderstanding the leaders is complex

$0

$200

$400

$600

$800

$1,000

$1,200

$1,400

$1,600

IBM + DS EDS Corp PTC SAP MatrixOne

US

$ M

illio

ns

cPDm RevenuesTools Revenues

Note: MatrixOne and SAP do not develop PLM authoring and analysis tools



SummaryWhat does this all mean to you …

Current economy is stressing all companiesIndustry pressures force investments in new approaches to address product & business innovationPLM is a strategic business approach… essential for innovation

PLM offers an excellent opportunity for business improvementPLM investments continue to gain momentum & visibility


CIMdataStrategic consulting for competitive advantage in global markets

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Documents

State of the PLM Industry - MetaLinc · 2007-05-27 · Management ERP PLM Product/Plant Process Definition People, Finances, & ... untapped opportunity within discrete industries