PLM in Action
"Our PLM stuff is our No. 1 system -- way more important than ERP because we're still a fairly young company. We're doing a lot of R&D, and we're still developing products," says Brian Sossaman, IT director at ReliOn Inc., a fuel cell manufacturer in Spokane, Wash. The company provides major telco providers, government sites and utilities with fuel cells for emergency and backup power.
Like most of the midmarket companies interviewed for this story, ReliOn turned to its key engineers to vet a short list of potential vendors before it selected Omnify Software of Andover, Mass. "We're in IT, not in the mechanical or electrical engineering groups," Sossaman points out. "They know what they're after."
With no small measure of relief, several IT executives interviewed for this story note how smoothly their PLM implementations have gone, especially when compared with past ERP projects. "The difference between PLM and ERP is really your target audience," Sossaman says. "You've got engineers on PLM and operations folks and accountants on ERP; those users are just not as technically savvy."
A PLM system is composed of several elements, including foundational technologies like extensible markup language (XML) or enterprise application integration; core functions such as data vaults, document and content management, workflow and program management; and information authoring tools and functional applications. PLM's set of highly configurable software modules run on various database platforms (Oracle, SQL Server and others) and are integrated with underlying engineering, design and product data management systems. The factor that distinguishes PLM from ERP is a tight focus on products rather than transactional business operations. PLM software is designed to handle the swiftly changing, unstructured data associated with product design, while ERP manages financial or inventory data.
At its best, a PLM system delivers both technical and strategic benefits to the business of making or moving products around the country and across the globe. At its worst, a PLM system can echo all the misery of a failed ERP project, such as integration problems; the complexities of network security, IT architectural design and data access; and the hurdles of defending the software's ROI to the business.
Indeed, many CIOs and vendors agree that showing an ROI for PLM can be tricky: It's more likely that with PLM in place a company will avoid incurring costs rather than actually achieve cost savings. "It's tough to quantify ROI, because it's tough to quantify people's time, and that's ultimately what PLM systems do; they save time," says CTO Chuck Cimalore of Omnify Software. It's also hard to argue that PLM is a mission-critical application since so many companies have gotten by with a mishmash of point products and Excel spreadsheets. "It's when they reach that critical point of too many product lines and too many issues that they need to automate," Cimalore adds. "We have to help them prove out this technology."
Another concern about PLM is that many of the applications are Web based, which users say can open the door to security breaches if these applications haven't been written with vulnerabilities like cross-site scripting, SQL injection or cookie tampering in mind.
Still, trying to master a mountain of product information without PLM is "very painful," laments one IT director from a midsized manufacturer of telecom equipment. "What you end up with is a lot of parts to manage in your ERP and engineering systems with no real lifecycle tracking for those products," says this IT director, who spoke on condition of anonymity. "I can see PLM being hugely beneficial for us, but I've learned the hard way that I have to get the line-of-business people to say they really need it first."
And then, of course, get them to pay for it.
This was first published in May 2007