Mr. Rajnish Kumar, Global Practice Head of Retail Consulting at ITC Infotech, writes his second blog for WhichPLM here, detailing the benefits of PLM and the diagnostics process encompassing both pre and post implementation stages.
As is the case with any other technology, product lifecycle management also has various factors to be considered before implementation. The underlying risks and cost implications warrant a thorough analysis during both the pre and post implementation phases. Although the success of any PLM implementation depends upon the realization of the business case established before undertaking the project, defining the same is not always simple. Businesses need to have the right metrics in place to establish a realistic business case, along with right Return on Investment (ROI) parameters.
PLM connects disparate activities in the product development process by linking teams across geographies and providing standardized updates, increasing process efficiency with its single version of truth.
With changing customer demands and disruptions in the supply chain, businesses need to focus on shortening product development timelines, lessening sample iterations and ensuring efficient monitoring of the development phase. This can be done by conducting a diagnostic assessment that would run a comprehensive health and feasibility check, highlight key gaps in the people, process and technology, and create a prioritized roadmap for future improvement opportunities, enabling organizations to accept PLM as the chosen system of use.
The diagnostics process encompasses both pre and post implementation stages. Organisations need to select their partners carefully and define their objectives clearly, lest the early phases of execution are fraught with adoption issues and marred by poor ROI.
Macro Analysis: It involves active engagement with the management team to understand the nature of existing issues. This helps in defining major KPIs (Key performance Indicators) that are affected by PLM implementation.
Business Process Analysis: It involving mapping both as-in and to-be sourcing business processes in detail. The process diagrams help in visualizing the process flow, which in helps in identifying the uniqueness, strengths and weaknesses of the existing system.
Requirements Analysis: This needs to be clear and unambiguous, with the requirements solicited from the clients across departments. Also, it must be prioritized and in accordance with industry best practices.
Business Case: This, being a critical consideration for decision-making, should take into account both cost savings by eliminating problems in product development and sourcing and revenue gains accruing from improved product development process. Year-on-year cash flow should be highlighted with ROI analysis to help define quantitative gains that would accrue over several years post going live.
Package and Vendor Selection: Finding the right PLM package is crucial. Businesses must look for one that has the required functionalities and needs minimal customization. It is equally important to find the right implementation partner with a proven track record and domain competency.
Training & Adoption: Poor end-user training decreases user satisfaction and credibility of the system as a whole. Thus, it is important for organisations to create a complete picture of who does what. This plays a crucial role in aligning end-user responsibilities with system functionalities. The training program should also highlight organization-wide benefits of maintaining usable and non-duplicated data in the PLM library.
Business Audit: The business case audit should not only focus on realized business benefits, but also on other metrics and processes. This highlights the lag effect of the indicators and the scope of process improvements in organization-wide scorecard.
Maturity Framework: The maturity framework should outline the strengths of the existing people, process and technology capabilities in realizing PLM benefits. While people gaps might include lack of resources available for leveraging specific PLM functionalities, process gaps could highlight the lack of adherence to defined to-be processes. Technology gaps could highlight the difference between the requirements defined earlier and the ones that surfaced later. All gaps identified need to be evaluated in terms of the direct impact they have on time, cost and efficiency gains. Maturity gaps can be highlighted based on roles and resources.
Roadmap: PLM is an evolving technology and any possible enhancement needs that surface can be taken care of in the implementation roadmap. The roadmap can cover added functionalities such as vendor compliance, mobility, production order tracking or internal technology interventions such as integration with the ERP system.
The diagnostics framework has tools to help conduct a current-state assessment, analyze gaps and recommend an improvement roadmap for course correction. Based on the product development landscape unique to the organization, it maps the deviation from Global Best Practices. The approach determines the organisation’s current level of maturity and evaluates its performance based on time, efficiency and cost parameters. The study helps extract value from current business processes and allows progress to the next level through optimal PLM usage.
PLM diagnostics is an ongoing process that starts from pre-implementation and continues even after going live. Business managers can use it periodically to find out what is working well and what could be done differently while evaluating the various process domains impacted by the PLM system.