Industry Solutions and PLM Strategic Cross-Road

The question of industry specific solutions in PLM was always interesting for me. Time ago, I asked in one of my posts about what will be the future of PLM vendors – to become industry specialists or to provide technological platforms for product development? So, I decided to put some of my thoughts about that with hope to clarify the current state and the future of Industry PLM.

In the early days, PDM/PLM started as a solution for very large manufacturing firms (i.e. Boeing, Airbus, Honda, GM…) that allowed to manage very complex product development. It was heavily customized and built to the specific organization. At the same time, EDM (Engineering Data Management) and Product Data Management (PDM) transformed into more reliable solution that can be beneficial to the smaller companies (Suppliers and smaller OEMs).

PLM – top down vs. bottom up move.
I can identify two parallel trends in PLM development. One was clearly top down one. The bigger companies, typically OEM in aero-space and automotive domains proliferate in their PLM strategies, mostly to Tier0 and Tier1 partners. Their primary interest to complement their product development processes and make their own life easier. In parallel, the idea of PLM got some traction in the eyes of smaller manufacturers. Most of them started to seek for a solution to manage product development. They are not necessarily called it PLM, but their primary interest was to find an easier way to manage product development without spending outstanding amount of moneys on PLM. The need for affordable PLM was clearly identified by PLM vendors and race to provide solutions to target larger industry audience with PLM began.

Segmentation vs. Fragmentation
What strategy will allow to make a PLM delivery to the broader manufacturer’s audience? In my view, this is an ultimate question all PLM providers were asking themselves for the last 5 years. For the companies working mostly with the “big outfits”, the obvious way to segment them into specific niches, classify and provide a diverse solution. This is the moment when some PLM industry wizards came with the idea of industry segmentation. The fundamental assumption was that “industry niches” have different product development practices and require a different solution. I have to say, that such segmentation allows them to develop a significant industry traction. However, my take on this is that in the real life segmentation is not as clear as marketing wizards wanted to see it.  When it is almost clear on OEM level, on the supplier level, industrial complexity is much higher. It made me think, “fragmentation” will be more appropriated definition. There are different groups of customers. Industry belonging exists. However, this is not always a primary or unique identification of customer needs. Additional context, such as, size, regulation, company location (inshore, offshore), type of design and manufacturing practices can be used to identify them in addition to the industry belonging.

Industry vs. Product Development Languages?
I think, industry language is very important. However, this is not the only way to differentiate PLM solutions. Manufacturing companies are struggling with multiple challenges and needs. Some of them, such as, control of product cost, global deployment, cross-company business processes are not unique among the specific industry. On the other side, I do see some very interesting examples of PLM solutions created for the specific industry.

PLM In The Cross-Road
I think PLM industry is in the cross-road and will need to take some important strategic and technological decisions soon. On the one side, there are specific industry needs and opportunities. The best way to solve it is to develop dedicated industry solutions. On the other side, PLM realizes that general collaborative and data management solutions may have cross industry approach. Even more, there is a growing competitive pressure from non-PLM vendors to provide a solution, especially in collaboration space.

What is my conclusion? PLM vendors will need to identify what are the core values for the PLM industry in the 2010s. There are technology, infrastructure, horizontal solutions and industry verticals. These are elements of PLM puzzle that need to be presented as a future PLM strategy.

Just my thought…
Best, Oleg



Share This Post

  • Oleg,

    Very good article about your thoughts on the current state of PLM. I suppose the niches, verticals, domains, whatever marketing calls them are a function of our society always wanting to put things in a box – to define things in a way. Once something is defined you can slap a feature list to it and a price tag on it and sell it.

    But I also think people are becoming more technically savvy and are starting to think bigger or more abstract which would enable your other thought that business process really aren’t that different across industries.

    Thanks for sharing,


  • Thanks for your thoughts.Agreed that Industry specific PLM solutions are required in future. I think way would be future PLM solutions will have some basic framework which comprises of basic PLM functionality/actions which will acts as basis for further on-top-solutions. I think here we can manage the Industry specific solutions.
    One catch point, I think is that these solutions needs to be quickly customizable/configurable/implementable,only then PLM solutions will be more flexible in nature to address the changes/etc…. I think so…
    Just my thoughts ….!

  • Mike, Thanks for your comment! I agree, lots of “features” are not really that different between industry. In most of the cases, you can find differences in names and not in actual performance. This is also the core reason why I dislike “slap a feature list” in PLM. I see PLM focus need to be in the ability to switch from “tell me” mode to “show me” mode. I’m going to blog about that later this week. Best, Oleg

  • Chandrajit, Thanks for sharing your insight! The typical enterprise software recipe today is Basic Features+Industry+Configuration+Customization. And I see it as a most often used practice for PLM vendors. Do you think this is a way to go in the future? My take on this is that it makes systems very expensive. You first look on what is available, compare it with you need in your organization, apply some industry specific pieces and then start to customize. You end up with something that far from your original basic features set, and you spent lots of organizational $$$. What is your opinion on that? Best, Oleg

  • Thanks for comments. I think in future, PLM vendors will provide basic framework & then customer will customize it accordingly rather than using vendor specific industry solutions which are more costly.
    Presently while selecting a PLM solution, customer has to do lots of comparison/PLM Tool evaluation between various PLM solutions available & at times it end up in compromise mode where customer will opt for the functionality/solution where available functionality are not fully required.
    I think, future PLM solutions will give customers complete flexibility to develop their own solution based on the selected PLM framework. I think so…
    Just my thoughts ….!

  • Chandrajit, Thanks! I agree. I think, flexibility (even if it sounds crazy for some of PLM folks today) is a key of the future PLM products. Best, Oleg

  • Oleg, thanks – I would like to add two additional thoughts:

    1. Components
    If you break down PLM functionality enough, you might end up with reusable components – even reusable across industries. Such a component-oriented approach should allow a vendor to branch from the core product into industry-specific variants later -> SOA / PDIF

    2. Professional services solutions
    Most of the industry solutions that I know were created by generalizing and packaging solutions that were built by professional services people in customer projects. They typically don’t have the same level of design, quality management, support etc. as the core PLM platform has.
    Best regards, Jens

  • Jens, I agree with you. A lot of PLM-related activities are not industry-related. Standard set of cross-industry components are a very good example of such a thing. The same is true about how “industry templates”. Most of them built on top of customer-projects. So, my conclusion – industry in PLM is mostly about marketing. I’d give an exception for industry regulation. That story might be different… Thanks for your comments! Best, Oleg