In his first guest blog for WhichPLM, Robert Kaufman, CEO of the Parker Avery Group, discusses OOTB PLM implementations; he begins with a definition of the term, explores Configured, Preconfigured, & Customized software, before arriving at his formula for success.
Justifying the PLM solution investment
Over the past 10 years, PLM (Product Lifecycle Management) software solutions for the retail industry have matured significantly and have been proven to drive substantial benefits. However, the financial investment required for successful implementations has made it difficult to get a PLM initiative to the top of the priority list for many companies – despite the ROI these projects can expect to generate.
To combat the inertia of companies unwilling or unable to mobilize new PLM initiatives, software providers have sought to find ways to reduce the time and cost associated with PLM projects and speed up the realization of value. The result has been a focus on “Out-of-the-box” (OOTB) or “Preconfigured” PLM models. Preconfigured solutions can indeed shorten implementation timelines, but if the solution provides only basic capabilities, this approach may not be enough to move the needle for some companies. Most companies expect more advanced solutions that not only support the functionality offered by their current PDM, spreadsheet and off-line database solutions, but also include desired enhanced capabilities. The chasm between the wants of a yearning business community and the capabilities in many OOTB PLM solutions can be wide.
In this article, Parker Avery sheds light on two key elements of the PLM journey:
- How to address the gap between business wants and the capabilities in most commercially available OOTB PLM solutions
- How to ensure the resultant solution does not require an endless set of enhancements adding to the time, cost and maintenance of the solution
Some assembly required
OOTB PLM solutions are being hyped as the new cure for the nagging ailment of long and expensive implementations. Not surprisingly, there are different interpretations in the industry of what OOTB truly means. A stringent definition of OOTB PLM (and the one we will use here) means that the software is ready to be used by a company upon purchase. This is not to suggest that most companies can use the OOTB solution without any additional work – despite claims to the contrary by some leading software providers. Other than smaller, less complex organizations, many companies will find the preconfigured solution to be a 60-70% fit with their requirements. However, if the alignment between a company’s needs and the OOTB solution is less than 60-70%, the selected software may not be best suited for the company.
Another factor to consider is that not all PLM solution vendors have experience in all types of retail business models. For example, a preconfigured solution that supports soft goods apparel requirements is very different than a solution needed by hard goods or even footwear companies. These models typically include industry-specific product attributes, different complexity in terms of bills of material and varied expectations of the level and type of collaboration with trading partners. In other words, not all preconfigured solutions are created equal, and it is important for companies to evaluate which OOTB model is most aligned with their business requirements.
Leading the change
With the appropriate starting point identified, following a preconfigured model and quickly realizing value is possible, but it requires an understanding of the guard rails and potential compromises that inherently come with this approach. Adopting the OOTB software “as-is” means that a company must change its business processes, tools and templates (e.g., cost sheets, tech packs or line review materials) to adhere to how the software has been designed and configured. Any desired changes to make the software fit more closely to a company’s existing processes require further configuration and / or customization, the latter of which contradicts the purpose of pursuing an OOTB approach in the first place and adds time and cost to the project.
While the leading practices embodied in a preconfigured PLM solution would likely warrant process changes that would be highly beneficial to any organization, few companies are truly prepared for the level of change required to follow an OOTB approach. This is often due to a lack of process harmonization within a company, especially across brands or lines of business within a brand. It is often quite difficult to get internal groups to “do the right thing” for the collective good of the company when they are looking out for their own best interests.
To most effectively combat this challenge, it is critical that the solution implementation include solid change management expertise – typically led by an external consulting organization who partners with internal senior business champions. Aligning on a holistic solution and not sub-optimizing for each group’s needs is often counter to the entrepreneurial spirit that built many companies, so this is not usually an easy journey. But in the long run, the time and effort spent harmonizing processes and aligning on how to do things consistently – except where uniqueness is truly warranted – will pay off in a less costly and time-consuming implementation.
Striking the right balance of customization
With a 60-70% fit to many company’s requirements, the preconfigured model is an appropriate starting point from which all solution design decisions should be made. To ensure a consistent decision framework and reduce the chances of user wants and desires creating a highly customized solution, guiding principles must be established upfront to determine the appropriate capabilities that will be enhanced in the solution.
Based on Parker Avery’s experience with numerous PLM implementations, the most appropriate types of solution enhancements include the following:
- Capabilities that support a company’s key differentiators
- Functionality that brings the product design team into the solution without requiring redundant entry (e.g., enhanced Adobe Illustrator plug-in functionality)
- Support for printing key visual assortment output (e.g., line sheets)
- Enhancements that improve usability (e.g., mass entry)
- Support for what-if analytical capabilities (e.g., what-if costing)
As noted earlier, there are some aspects of every company’s processes or business model that are highly unique and are the primary drivers of their competitive advantage. In fact, some of the more creative outputs from a PLM solution, such as line sheets, are often customized to meet the needs of the design and merchandising teams. This “need” for customization is not surprising – especially for companies who are used to developing line sheets or line boards in a design tool that provides unconstrained abilities to tailor the look and feel of the product line. This approach is not much different than providing unique reports to the user base (a very common outcome after analyzing OOTB reports for applicability). The good news from an OOTB perspective is that customizations for line sheets and reports most likely will not alter the core framework or code of the software solution; thus the ability to upgrade should not be compromised.
A more controversial change to the software is the introduction of configurations or customizations to increase usability. The user community will reject even the most functionally rich solution if it is cumbersome and difficult to use for repetitive tasks. Thus many companies end up enhancing their PLM solutions or building front-end “bolt-ons” to ease data entry and improve usability.
As with any solution implementation, too much customization can lead to a lengthier and more costly project, inhibit future upgrades and result in increased support requirements and costs. Therefore, every PLM implementation should incorporate a strict scope governance model to evaluate the projected benefit of each customization being considered. A delicate balance must be achieved: on one hand, companies cannot compromise their “secret sauce” for the sake of a cheaper and faster software implementation, but on the other hand, too much customization increases the project cost and maintenance burden and may limit the ability to benefit from future software enhancements. And in all instances, if the solution is burdensome to use, business users will “opt-out” and revert to their former way of doing things.
OOTB + Change Management + Governance = Success
Organizations looking to invest in a new PLM solution can take advantage of the many lessons learned by their predecessors. A fully OOTB approach is not realistic for most companies; in fact following this approach could be counter-productive. Companies should select software with a preconfigured solution aligned with their business segment (e.g., apparel). This approach will serve as a solution accelerator which, when coupled with strong program scope governance and an effective change management program, will produce a solution that more quickly delivers meaningful benefits and results in greater user adoption.