Product lifecycle management overview

Product lifecycle management (PLM) connects every stage of a product’s lifecycle. From initial design, to valuable IoT data, to customer feedback—every piece of information across the product lifecycle is connected to a bigger story.

And with today’s circular economies and more transparent supply chains, the product lifecycle story can extend back to the raw materials used in production, and forward to end-of-life stages such as recycling and repurposing.

The key to a good PLM strategy is to listen to all those stories — and be able to act upon them. This means integrating and analysing data from every stage so that you can make meaningful improvements and innovations, quickly.

What is PLM software?

As a technology, PLM software helps organisations to develop new products and bring them to market in far more efficient, collaborative, and sustainable ways. It integrates processes for each stage of a product's lifecycle across globalised supply chains, making it easier to track and share data along the product value chain—from initial design and engineering through manufacturing, and supply chain management. PLM solutions can help teams collaborate and work together, no matter where they are, using a common record of enterprise product data, such as parts and material requirements, engineering changes, workflows, and regulations. And when smart technologies such as AI and the IoT are introduced, modern PLM solutions can provide real-time insights into product performance, customer feedback, and market trends.

PLM meaning in business

In an age where innovation is key to business survival and success, PLM plays a critical role in helping manufacturers develop the next generation of products, at a lower cost, and with a faster time to market. While PLM can also be interpreted as a business strategy, three fundamentals impact the way teams work and the ability for organisations to grow and thrive:

• Universal, secure, managed access to and use of product definition information
• Maintenance of the integrity of that product definition and related information throughout the product's lifecycle
• Management and maintenance of the business processes used to create, manage, disseminate, share, and use the information

The five phases of product development

There are many different ways to describe the phases of product development and no single industry standard. However, the phases below represent a typical development cycle.

1. Concept and design: The ideation phase, where a product’s requirements are defined based on factors including competitor analysis, gaps in the market, or customer needs.
2. Develop: The detailed design of the product will be produced, along with any necessary tool designs. This phase includes validation and analysis of the planned product, as well as prototype development and piloting in the field. This generates vital feedback on how the product is used and what further refinements are needed.
3. Production and launch: Feedback from the pilot is used to adjust the design and other components to produce a market-ready version. The production of the new product is scaled up—followed by launch and distribution to the market.
4. Service and support: Following the launch of the new product, the period of time when service and support is offered.
5. Retirement: At the end of the product’s lifecycle, its withdrawal from the market must be managed—along with any retrials or absorption into new concept ideas.

How does a PLM system work?

A PLM system provides designers and engineers with access to the vital data they require in real time. The system streamlines project management by linking CAD (computer-aided design) data with a bill of materials and other enterprise data sources, such as integration with an ERP system, and manages this product data through all stages of the product development lifecycle.

PLM also prevents designers and engineers from operating in a disconnected vacuum, giving them insight into external sources of information such as customer and analyst feedback on current products, performance data on products in the field, and visibility into the limitations of downstream processes such as manufacturing.

A PLM system also benefits teams beyond design and engineering. It can provide ‘single source of truth’ visibility to business stakeholders and/or suppliers for easy delivery of feedback early in the product development process.

Evolution of product lifecycle management

In the 1980s, American Motors Corporation (AMC) was a small player in the automotive industry. The company lacked the large budgets of bigger players in the market, which hampered its ability to compete effectively. AMC leadership had the idea of tracking products from inception to end-of-life in order to improve processes and compete more efficiently—the first iteration of product lifecycle management.

The data gathered was used to inform better decisions from ideation through to procurement and the production process. AMC increased its market share and the company was later purchased by Chrysler and became the motor industry’s lowest-cost producer by the mid-1990s.

Today, PLM has been adopted across manufacturing to foster collaboration, boost innovation, and efficiently support growth through designing to customer demand and product individualisation.

In a time of digital transformation, rapidly accelerating AI adoption in manufacturing, and changing world economies—PLM plays a critical role in helping companies get products to market more quickly and maintain a competitive edge.

Five benefits of PLM

The following are five key reasons why companies choose to invest in PLM solutions.

1. Improvements to development, efficiency, and innovation: Silos can be the greatest challenge to engineering team performance. PLM enables the bidirectional flow of real-time data to support better knowledge sharing and collaboration. End-to-end PLM solutions allow for AI-enabled automation and insights.
2. Elimination of errors during the engineering release process: It is far simpler—and cheaper—to rectify product issues that are identified earlier on. PLM helps to reduce cost and offers the additional environmental benefit of reducing manufacturing waste.
3. Reduced time to market: Providing a single source of truth with up-to-date information at every stage of the product lifecycle, PLM enables project managers to manage overlapping timelines and bring products to market more quickly.
4. Improved project delivery: A cross-enterprise, digital PLM solution supports advanced workflow management. In this use case, PLM enables a team to calculate product costs precisely and manage the handover to manufacturing new designs more effectively.
5. Higher quality designs: PLM offers designers and engineers a deeper level of insight into product requirements. Ingesting data from many different internal and external sources, a PLM system with integrated machine learning can turn performance data and customer feedback into new feature suggestions.

Overcoming PLM challenges

Currently, fewer than half of R&D executives say they have visibility into the end-to-end, design-to-delivery process. This highlights that, for many organisations, PLM has not yet reached its potential as a single source of product truth.

In addition, the growing adoption of Industry 4.0 practices within manufacturing has led to an exponential increase in the amount of product and customer data available, providing greater visibility across product lifecycles. Data sharing among PLM entities could streamline product lifecycle management, but only if the data is correctly captured, analysed, and disseminated safely—bringing into focus the need for integrated AI, machine learning, and data encryption.

Finally, many PLM advocates struggle to communicate the relevance of the software beyond engineering. In all of the above cases, investing in a solution that integrates with existing enterprise systems—and offers built-in artificial intelligence—will increase the use and value that the wider organisation can gain.

Future of PLM technology

The demands of beating competitors to market, attracting top talent, and producing the highest quality product possible using sustainable practices will only continue to increase over time. PLM can help to meet these demands with shorter, more conscientious design and product engineering cycles, but only if organisations invest in the technology required to get there.

• Internet of Things (IoT) enables designers and engineers to gain greater visibility into products in the field, as well as the ability to update products that are already in the hands of consumers. McKinsey research indicates IoT could enable $5.5 trillion to $12.6 trillion in value globally by 2030.
• As sustainability continues to emerge as a topic of importance, businesses will look to modernise their product development processes through green product design, manufacturing, and logistics with the goal of achieving full supply chain sustainability.
• As with other types of enterprise software, PLM systems are increasingly being offered in the cloud as software as a service (SaaS). This will make PLM more accessible to smaller companies and will continue to drive the collaboration that effective product development teams need whilst workforces become more distributed.
• Digital twins are virtual models of a product that are connected to their physical ‘twin’ via IoT and are managed within PLM systems. Adoption of digital twins is growing from nearly USD $13 billion in 2023 to USD $259 billion by 2032. Companies utilising digital twin strategies realise average emission reductions of 15% and cost savings of 19%.

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