Vertical PLM Medley

Vertical PLM Medley

I read an article “PLM’s Vertical Challenge” in High Tech Views. The High Tech article is presenting advantages of industry-oriented PLM implementations. Read it and make your impression. I specially liked the following part:

“We needed something that had an apparel maker’s focus in mind. Otherwise we’d be spending too much time trying to tailor something else,” says Rich Zielinski, Under Armour’s vice president of technical services. “The more tailoring you do, the more a system doesn’t work.”  Companies in many industries are learning that lesson. Having lived through lengthy, expensive, and often fruitless enterprise software rollouts, especially in the areas of ERP and CRM, manufacturers are now reluctant to bankroll the deployment of generic PLM systems in need of major modifications for handling industry-specific requirements and company-specific business processes. They understand that, as the PLM market matures, much of the heavy lifting associated with mapping out critical business processes and industry requirements — for example, in the areas of regulatory compliance or quality management — has already been done by the vendors and early adopters in sectors such as automotive and aerospace and defense.

The problem is very interesting, in my view. Companies are suffering from long time implementation cycles. The alternatives need to found. In the early beginning of PLM-era, CAD/PLM companies were selling toolboxes with a significant portion of services and implementation consultancy. However, 1-2 years implementation cycles, significant budgets and unsatisfied customers made vendors to think about possible alternatives.

PLM Industry Solutions
The idea of industry solutions (or how companies are calling it – industry verticals) isn’t new. If you will take a look on the PLM portfolios all major PLM (and not only) vendors, you can see a standard portion of industry doggy food. The industry solutions reminded me storytelling. In the beginning, industry sales or industry professionals are proving that they can speak to a customer in the “industry language”. Then it turns to the software? The very typical option is to have a pre-configured software package including full pack of documents and presentation explaining how to use it inside of the company. You can see below a top-view on such industry-oriented packages.

Vertical Solution Problems

What is the biggest advantage of Industry Solutions? In my view, pre-packaged functionality. What is the biggest disadvantage? In my view, the same. Engineers have a tendency to work slightly different. Organizations may have their own way to run a development that doesn’t fit 100% to pre-packaged functionality provided by vendors. So, the biggest danger is that customer will need to customize the industry solution to fit organizational needs.

Granularity and Risk Management

How to manage risks in implementing vertical PLM solutions? One of the possible ways is to increase the granularity of the solution you are going to buy and implement. To have small pieces that can stitch together can prevent you from grandiose plans to implement all in a single shot.

What is my conclusion? The best association that comes to my mind when I think about vertical PLM solutions is CD-medley. Do you remember that? You can buy Bach-medley, Mozart-medley, Rock-n-Roll-medley… You can buy a double-CD-medley for a bargain price. It was 15-20 years ago… What can be better? Now we know – iTunes. More granular approach can win over the time. Just my thoughts…

Best, Oleg


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  • Rcgranros

    Since the mid 90’s, I have been developing and delivering process industry specific PLM solutions. For companies looking to be more competitive and continually evolve, vertical specific PLM should reduce your initial implementation and lifetime costs and provide a competitive advantage. While some of larger companies will say that they have achieved competitive advantage with a horizontal PLM, they were required to invest in significant levels of customization and suffered from extended time to market. The ugly truth is most of these “unique” customizations are available from the vertical PLM providers and may organizations are just protecting their existing staffing. By continuing to rely on customization, the implementation stretched out and their ability to react to market needs was reduced. While this may work for the Fortune 500 type companies, few SMB companies could afford the required implementation and ongoing support costs. The other trap is best practice configurations that are really best for the PLM vendor and not really industry best practices. If the vendor has a handful of customers, how can they claim to have “industry best practices”. Unfortunately, too many companies believe these “sweet nothings” and find that they are at a dead end. Vertical PLM solutions that can evolve with you will reduce your costs and continue to provide competitive advantage. Beware of vendors claiming that they have industry best practices that are really the best way to get their software live.

  • beyondplm

    Rory, Thanks for your comments! If solutions are available from vertical PLM providers (btw – who are those providers?) what do see as the main reason that prevents companies from implementing them? Best, Oleg

  • Rcgranros

    Like ERP, many companies think bigger is a better and bigger company have greater marketing reach. While the supplier may seem to less risky than a small company, good software products rarely die. In the chase for significant growth or the next fad, big IT supplier core product start to stagnate and most investment are in addon technology or bolt on products. Since smaller companies have fewer products, they continue to invest in their products. In chase for the next fad, big IT supplier has two big advantages. With their larger staffs or ability to acquire new technologies, end user companies start to think that all new stuff is value added and a must buy. When competing for new business, we often were blanketed with huge RFPs. When you started to peel away the onion’s fluff, 80% or more of the RFP was a multitude of ways to support customization. If we blindly answered the RFP, the ranking of responses would have placed us very low and we would not make the cut. When we were able to focus on the business issues, the horizontal PLM provides were easily dismissed. Our biggest challenge was coverage of big PLM sales and marketing. As a small company, we often were not included in deals or we were started in the hole. If companies really want to improve their business with a more cost effective solution, vertical PLM solutions that are not “packaged to get their solution live vs. being configurable industry best practices”, vertical PLM should be a better solution.


  • beyondplm

    Does it mean that small vertical PLM solution providers are losing to giant PLMs because they are just not included into RFP? It reminds me an old joke that “there is no IT manager, which was fired because of signing a contract with IBM”. Best, Oleg

  • Christine

    Working with an ambitious startup vehicle company, we have big plans for enterprise software integration. PLM, MRP, and CRM are all in our near future, but realistically we are so busy trying to build processes and products that the focus hasn’t been on the implementation of the systems that we obviously need desperately. Vendors have circled and been happy to tell us what we need, and despite the affirmative head nods, we still have yet to do a kick off.

    In the mean time, we develop work-arounds that are beginning to remind me of that famous scene from movie “The Jerk” where Steve Martin’s character walks out saying he doesn’t need anything. If you haven’t seen the movie, it turns out he needed an ashtray, a paddle game, a remote control, and a lamp, but that was all. Oh, and a chair, some matches, and … well the dog, but that was all, but he didn’t need anything. Classic scene that runs through my mind every time I pack for a business trip…

    I agree 100% that granularity is the solution to the growth and implementation problem. It would be great if a PLM vendor could be flexible and nimble enough to simply solve a company’s burning problems as they pop up within the scope of a unified platform. Solve today’s problems today, and tomorrows problems as they emerge. I’m not saying that we can’t learn from industry parallels, but growing companies have enough problems to worry about without adopting the problems of their predecessors.

  • Rcgranros

    It is similar to the old “IBM” scenario. Smaller PLM providers play best in their home territory and have small sales teams. If you are located in east, you often have limited or no coverage in CA or the west coast. Without it, you miss many RFPs. Even if you get the RFP, most just reply to the RFP and play right int the hands of big PLM providers. Since they flood the RFP with every possible piece of :”bling”, they get eliminated. Unforunately, these huge RFPs have features that will rarely or never get used. When discussing this with an IT person, it reminds me of the Monty Python shit called “Confuse the Cat”. Every time you start discussing their real business issues, you get distracted by the all the different and often incompatible methods of customization. If you are a .NET shop, why to the other 5 coding structures matter?

    At the end of day, the real reason IBM was attractive was resume enhancement. If you bought IBM or or now SAP/big IT application provider, you will have increase your resume While it is positioned as a corporate risk issue, it is more often a personal resume enhancement opportunity.


  • beyondplm

    Christine, Thank you for comments! Excellent example, indeed… The biggest problem of complicated industry solution, as I see, is a re-work. Lots of stuff is going to be re-worked at every implementation. As a result, we have an industry with ~50% of implementation service revenues that paid to re-work things already billed by a vendor. This thing needs to be fixed in my view. Best, Oleg

  • beyondplm

    Rory, I agree with you – big vendors have bigger exposure. I think, the situation is changed a bit now. However, this is off topic from Vertical PLM Solutions… I think, big vendors are using vertical /industry solutions first as a marketing tool. This is a strategy that works in sync with their implementation services. Best, Oleg

  • Barath_s

    Vertical Solutions help acceptance especially in more OOTB scenarios.
    Long upgrade/migrate cycles and rapid product obsolesence have pushed customers towars more configuration, less customization. Granularity helps ensure that best practices and benchmarks from outside the vertical can be easily pulled in at lower cost. That’s not near the end of it, though; making sure it’s put together right is more than just mix and match., it’s vision, execution and right tactics

  • beyondplm

    Barath_s, thanks for sharing your insight! I agree it is all about mix of products and implementation strategies and tactics.
    If a vendor can provide pre-configured solutions, it can save time and improve the situation with upgrades and migrations. However, don’t you think this is just a marketing dream? And the reality is that after all vertical-industry-solutions sold to customer, lots of additional implementation need to be done by a customer or service providers? When it comes to implementations, it becomes the part of what you identified as mix/match of vision, strategies and tactics.
    Granularity is, indeed, key in my view. When you have small pieces of solutions that can stitch together, than risk and cost of changes and additional modification is much lower. Also, small products/apps have lower price and can be easy sold to customers.
    Just my thoughts… Oleg