Wednesday, December 16, 2009

ZSL in Press: Taking a Holistic Approach - Excerpts from Machinist Magazin

India, December 05, 2009 – In today’s manufacturing scenario, PLM has become a prerequisite for success. Saikat Nandi discusses the adoption of this solution.

Product lifecycle management (PLM) is a recent concept that has taken the manufacturing world by storm. PLM represents all the activities that are required to manage the design, production, support and the ultimate dispersal of manufactured goods.

PLM helps organisations integrate the product information obtained from the design and engineering functions with allied activities such as sourcing,compliance, suppliers, sales, marketing, customers, supply chains and reverse logistics. In order to hasten product development and time to market, ensure quality, reduce recalls, ensure eco-friendliness, and mitigate regulatory risks more effectively. PLM gives manufacturers the tools and processes to enable collaborative engineering, customised product development and project management among multiple business partners.

The functions and features of PLM applications have gradually expanded beyond the traditional areas of CAD, CAM and CAE to cover other aspects of the product lifecycle—content management, after-sales services, marketing, etc. The PLM application is built on an integrated set of solutions, work processes, projects and data that provides one source of truth to help manufacturers make informed decisions in real time.

Increased internal and external collaboration is a great indicator to measure the success of PLM. The seamless integration of customers, suppliers, and partners shortens the time to market, reduces costs, improves product quality, ensures regulatory compliance and increases innovation.

The objective of PLM is to create a one-stop-shop for all product related information, right from idea generation to disposal. As the speed of changes taking place in the market, technology and internal environment is constantly increasing, enterprises need to make smarter decisions to maximise their returns on investments and align their best resources and opportunities to deliver high quality products cost-effectively. PLM helps an enterprise maximise profit by optimising every stage of the product’s lifecycle—from bids or project requests to portfolio management and product development. PLM covers the market reaction for prototypes, alignment with the trends, ongoing maintenance and retirement. As PLM coordinates product information from engineering and design with sourcing, compliance, suppliers, sales, supply chains, customers and marketing. It speeds product development, ensures quality and mitigates regulatory risks.

PLM helps enterprises attain complete visibility of how and where materials and products are sourced, and effectively tracks and manages their adherence to all of the key regulatory compliance and sustainability mandates. An example of this is Henkel Laundry & Home Care. Dr Lars Zuechner, Head of Innovation Management/Global R&D Management, Henkel Laundry & Home Care, says, “Integrating corporate social responsibility into product lifecycle management, as Henkel has done, is important and key for enabling and ensuring sustainable innovation without harming the environment.”

PLM in today’s digital enterprise

Dynamic trends, short lifecycles and economic pressures require that companies pay close attention to their business processes and their technology infrastructure. Responding to trends through complex global supply chains requires that today’s leaders possess software that enables secure, real-time collaboration founded upon a single product data management infrastructure.

Shiv Kumar, Executive Vice President, Business Development, Zylog Systems Limited, says, “Considering today’s marketplace, driven by Enterprise 2.0 and social media technologies, innovative, successful new products and continual product improvements are the lifeblood of business growth and profitability. With 80 per cent of costs, 90 per cent of regulatory risks and 60 per cent of market acceptance being fixed in the development phase, new product success rates are largely determined in the product development phase.” PLM is thus a vital component in today’s digitally driven manufacturing world.

Today’s most frequent product development problems include:

Design cost
Collaborative outsourcing
Growing company portfolios
Misalignment of expectations
Communication silos
Insufficient resources
Poor supply chain coordination

Many companies face these issues as they come to terms with the changes in the manufacturing process. PLM provides an effective solution to these issues as it integrates all aspects of the manufacturing process to increase efficiency and effectiveness across the product lifecycles.

India is ready for PLM
India is ready to initiate PLM processes on a large scale. India’s economy grew 6.1 per cent in the last quarter, igniting hopes that the economy is emerging from the global financial crisis. The Indian manufacturing sector, which has around 80 per cent weightage in the Index of Industrial Production, has shown phenomenal growth as compared to the manufacturing sectors of other developing and developed countries.

This is clear indication of the fact that India is ready to move on to the next level of technology. As India becomes highly visible as a global manufacturing hub, PLM can be a game changer for the country’s manufacturing sector.

Generating business value

‘When the going gets tough, the tough get going’. In challenging times like these, what distinguishes great companies is their continued belief in their ability to stay ahead of the pack. PLM provides the most complete solution to manage the end-to-end cycle, reducing integration costs while maintaining fast deployment at the customer location.

In terms of business value, here are some of the straight benefits companies can enjoy:

Reduced costs: A PLM solution allows manufacturers to outsource tasks and focus on the company’s core competencies while controlling the costs of relationship management.

Better business results: With PLM, manufacturers can develop innovative products, explore new market opportunities, gain a greater market share and increase customer satisfaction.

Higher product quality: PLM helps manufacturers manage product quality and reduce waste at every phase of the product lifecycle.

Faster development: The solution reduces time-to-market and time-to-volume by closely integrating supply chain management and procurement.

Better business decisions: PLM supports decision-making at all levels with powerful analytics covering areas such as portfolio management, occupational health, product safety, product quality and maintenance management.

Lower cost of ownership: PLM can be integrated with operational systems such as CAD, ERP, CRM, SRM and SCM systems.

In an increasingly competitive environment, the organisation can integrate PLM and sourcing processes to deliver more compelling products, reduce the cost of goods sold (COGS) and improve performance. All the benefits offered by PLM will enable the company to strive for growth.

Integration between PLM and ERP
PLM has evolved into an enterprise system which manages the entire product lifecycle. The interface with the organisation’s ERP, supply chain and extended enterprise is essential as businesses try to shorten the time-to-market, produce more with less and work with partners across the globe. Valmeeka Nathan, Vice President and Head of Product Lifecycle and Engineering Solutions, Infosys Technologies, says, “PLM provides a single source of truth for product information, which drives the downstream processes. The integration of PLM with ERP is crucial in planning for vendors, manufacturability, and throughput.” Sharing of this information is not dynamic in view of the evolution of product and engineering changes. At the same time, regulatory needs, compliance and quality checks are instituted during the design phase and are used during the production or service phase of product use.

While the paradigm for ERP is more transaction-based, that of PLM is iterative. With product lifecycles getting shorter, it is imperative to keep the focus on innovation and operational efficiency. From a technology perspective, the integration is moving away from a point-to-point to a more service-driven, serviceoriented architecture.

Rajeev Dev, Associate Director, SAP Practice, Fujitsu Consulting India Pvt Ltd, says, “An integrated product development and sourcing strategy can significantly improve a company’s performance standard. Specifically, companies can expect direct benefits in terms of speed and cost; they can also realise indirect benefits in terms of product quality and innovation.” PLM offers integration between the engineering department, business software such as CAD, vendor collaboration, etc.

Manufacturers’ business needs have changed significantly over the past several years, as the role that technology plays within the manufacturing process has evolved. Two key technologies, ERP and PLM, have developed into critical success factors for manufacturers. Each technology brings unique value to the enterprise, and, when combined, ERP and PLM provide a wholly collaborative environment that has a major impact on successful product development and the manufacturer’s ability to maintain a competitive advantage.

ERP and PLM address different business needs for manufacturers. There is some confusion in the industry as to what role each system plays in a company’s business process. It is important for manufacturers to understand why each is so critical to their success. Clarifying the key features of ERP and PLM—where each fits into the product development and manufacturing process, and how integrating these environments can deliver positive results will help manufacturers gain a clearer perspective on these processes. This clarification will help manufacturers /organisations to maximise the functionality of each system and gain the most from their investment.

When integrated with PLM, ERP reduces data duplication, speeds product development cycles and improves new product turnaround time. This enhances the overall process of getting products to market, and ultimately sustains a company’s competitive position.

Global economic drivers

There are multiple factors driving the growth of PLM today.The world is going through a major recession cycle; only in the last quarter has the market showed some signs of recovery.

For the majority of companies, PLM is a strategic move to weather the current economic storm and be in the best competitive position when the global markets rebound.

For others, the move to PLM is being driven by the growing demands from customers who want more for less.

Finally, most organisations today have clearly understood the benefits of outsourcing and PLM and consider it an essential aspect of their strategies.

Organisations with long-term vision are the ones which will actually invest in these areas to be prepared for future growth.

Benefits of PLM

It is widely recognised that PLM bring benefits in four main areas:

Financial performance: PLM leads to increased revenue from existing products and reduces product development costs

Time reduction: PLM reduces project overrun time and engineering change time

Quality improvement: PLM helps reduce manufacturing process defects, the number of returns and recalls, and customer complaints

Business improvement: PLM can lead to an increase in the innovation rate, the part reuse factor, product traceability, and also ensures 100 per cent configuration conformity

In a changing world

Change is, as they say, the only constant. In business, it is through the zeal of smart individuals who continuously innovate and bring new ideas into practice that we experience this change. Today, seamless integration is the new mantra: it aims to connect all systems of an organisation to create a smarter organisation. Tomorrow, this will probably be taken for granted and we will be heading for another revolution.

At present, most large enterprises have some sort of PLM system in place and we are witnessing many consolidations in the PLM vendors’ marketplace working towards offering a complete solution. However, small to mid-sized enterprises are not well equipped with industrystandard PLM solutions, as most of them run in-house or silo apps to handle very specific automation or workflow processes. The PLM adoption cycle varies from business to business, based on the maturity of the business processes and the IT infrastructure. Small and mid-sized enterprises would typically avoid adopting PLM in a ‘big bang’ approach while they undertake any new initiative. Here, choosing the easy-to-deploy vertically aligned modules or solutions will help them to get their ROI faster.

Industry interest in aligning PLM with lean initiatives and quality processes is growing continuously. Even companies that have already equipped the workstations of their designers, production and quality engineers with automated systems are showing interest in industrystandard integrated solutions in order to produce defect-free products faster and cheaper.

Despite the differences in quantitative indicators from different market researchers and forecasters, all researchers unanimously agree that the PLM market is growing and will continue to grow as businesses embrace legacy modernisation; business process re-engineering and socialmedia-led collaborative innovation. PLM as an integrated concept will be further optimised to allow a close tie-up of all the processes and functions involved. This is the key for successful, efficient and sustainable innovations.

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