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It is hard to overestimate the value of bill of materials (BOM) in product design, engineering and manufacturing. It is everywhere – product design and configuration, engineering, manufacturing, operation, etc. BOM is equally important and complex. In my earlier articles, I touched multiple dimensions of BOM complexity - disciplines, product lifecycle, changes. PLM vendors are focusing on high level of integration of product information into development process. Few months ago in my article When BOM is not BOM, I touched some of aspects of BOM complexity and how it related to BOM ownership, BOM errors and future battle for MBOM ownership between PLM and ERP.

Actually, the battle between PLM vendors for superior BOM solution can be even more interesting. Engineering.com article – Volkswagen’s Epic Challenge to synchronize PLM for its Truck Brands brings a very interesting story about German automotive giant trying to unify PLM solution across its commercial vehicle brands. Take some of your lunch or evening time and read the article.

The example of Scania brings up the value of well integrated PLM solution to support vehicle configuration and manufacturing.

The secret to Scania’s success is a sales model where product development and modular manufacturing processes are interwoven with sales into a holistic system. The company is known for its tailor-made vehicles. Scania’s PLM plays a big role in its business model. Scania uses Dassault’s (DS) CATIA V5 while ENOVIA V5 serves as the CAD vault. PDM functionality is handled via Scania’s proprietary OAS platform which defines the rules for how the components can be assembled. The OAS works as a product database, configuration and structural control solution. CAD geometries are downloaded from the ENOVIA CAD vault in accordance with the configurations delivered by OAS. In terms of the eBOM and the mBOM, it’s once again about OAS and its couplings to ENOVIA. The company’s manufacturing solutions can’t handle many variations; you have to prepare one at a time and make them individually for each truck.

For some your it might be a big surprise, but according to the article, Excel is a key element of PLM solution used by another vehicle manufacturer. MAN is using Excel based technology to work with EBOM and MBOM.

MAN uses both Dassault’s CATIA V5 and PTC’s ProEngineer/CREO. After a succesful pilot last year that considered product development (ie, not production), the company chose PTC’s PDMLink (part of Windchill) for their CAD vault and PDM system. Configuration and structural control is principally handled via an Excel Integration with PDM Link. The eBOM (engineering BOM) and the mBOM (manufacturing BOM) are produced by PDM Link via the Excel integration, picking up the parts from the CAD vault. The implementation of PDM Link is under way but at a low speed in anticipation of a final PLM decision.

The story of MAN and Scania made me think about importance of BOM management in complex product configurations and vertical integration with manufacturing. Build to order or engineering to order environments are extremely complex and require fine tuned integration between engineering bills, configuration parameters (features) and ability to translate it into manufacturing and as-built environment.

Here is my favorite passage from engineering.com article which put nail in the head of BOM importance.

BOM management issues will be the most crucial and will determine the direction the company takes. Regardless of what VAG decides to do, the gains that can be made through sharp, highly automated BOM creation and MDM (Master Data Management) solutions is significant. The advanatge of an MDM solution is that it connects the PLM, MES and ERP systems into seamlessly functioning IT units for the shop floor and manufacturing.

What is my conclusion? Platformization is one of the trends in modern PLM according to CIMdata. The example of VW shows an importance of BOM management in order to provide robust and scalable PLM solution for complex automotive manufacturing. My hunch BOM will become one of the most important weapons PLM vendors will be using to differentiate future PLM platforms. Just my thoughts…

Best, Oleg

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How to sell PLM to big companies

by Oleg on April 14, 2015 · 2 comments

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PLM sales is not an easy job. PLM is usually “sold” to companies… or actually sold to people running product development and manufacturing in these companies. I shared some of my thoughts about PLM sales in my previous posts – PLM Sales Cheat Sheet and Why hard to sell PLM ROI?

However, I want specially reference the following article – How to sell PLM to enterprise IT, which is setting a stage for my thoughts today – how software vendor is selling PLM to big companies. In my view, this is probably encounter for 99% of PLM business as of today. In most of situations, PLM software vendor, business unit or organization is selling to much larger businesses – manufacturing OEMs and suppliers.

The following article by Mark Andreesen gave me a big chunk of inspiration – The Mobi Dick theory of big companies. The article is worth reading. It helped me to identify and articulate 5 guidance principles of how to sell PLM to big companies. These are absolutely necessarily to keep in your mind if sell PLM to large OEM and just big manufacturing companies.

1. Set yourself for a very long sales cycle (months or even years).

Be extremely patient. Big companies play “hurry up and wait” all the time. It is probably going to take a lot longer to put together than you think.

2. Hire real sales people.

If doing deals with big companies is going to be a key part of your PLM business, be sure to hire a real sales pro who has done it before.

3. It is not done unless company is using PLM in production.

Never assume that a deal with a big company is closed until the ink hits the paper and/or the cash hits the company bank account.

4. Try to avoid bad deals

Selling to large companies can often require development of additional features and long pilot projects that will involve best product and technical sales people. It will suck the energy of your organization.

5. References from another big company.

Don’t sell to large OEM by referencing small tier-n supplier. It won’t work. Be aware that big companies care a lot more about what other big companies are doing than what any small company or startup are doing.

However, my absolutely favorite passage from Marc Andreesen’s post is the following one. It gives you a good picture of what will influence PLM sales decision process :

The consensus building process, trade-offs, quids pro quo, politics, rivalries, arguments, mentorships, revenge for past wrongs, turf-building, engineering groups, product managers, product marketers, sales, corporate marketing, finance, HR, legal, channels, business development, the strategy team, the international divisions, investors, Wall Street analysts, industry analysts, good press, bad press, press articles being written that you don’t know about, customers, prospects, lost sales, prospects on the fence, partners, this quarter’s sales numbers, this quarter’s margins, the bond rating, the planning meeting that happened last week, the planning meeting that got cancelled this week, bonus programs, people joining the company, people leaving the company, people getting fired by the company, people getting promoted, people getting sidelined, people getting demoted, who’s sleeping with whom, which dinner party the CEO went to last night, the guy who prepares the Powerpoint presentation for the staff meeting accidentally putting your (company) name in too small a font to be read from the back of the conference room…

What is my conclusion? Selling PLM to big company is more science than a procedure. The way current PLM paradigms and technologies are set, company is buying PLM and defining the way to manage product development processes using PLM technologies. It is painful, because this process is supposed to change the way people do business. However, in a big company you are dealing also with extreme level of organization complexity. We cannot change big companies, but we can change PLM paradigms to convert PLM sales into repeatable process. Just my thoughts…

Best, Oleg

Image courtesy of stockimages at FreeDigitalPhotos.net

 

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The thing you can often hear about PLM implementations – it is about change. PLM will change the way you do business and manage product development processes. This topic is widely discussed by PLM industry insiders, advisers and customers. Jos Voskuil (virtualdutchman.com) put a nice article about complexity of PLM and change management – PLM and blockers, which took me into John Dyer’s article – What Motivates Blockers to Resist Change? Here is my favorite passage about the change and PLM:

The combination of business change and the existence of blockers are one of the biggest risks for companies to go through a business transformation. By the way, this is not only related to PLM, it is related to any required change in business.

According to another article written by Jos, the core of the problem is even bigger. It is actually our brain. Read the following article - Our brain blocks PLM acceptance. Jos brings an example of Nokia and their failure to manage the change:

Nokia was famous for they ways they were able to transform their business in the past. How come they did not see the smartphone and touch screens upcoming ? Apparently based on several articles presented recently, it was Nokia´s internal culture and superior feeling that they were dominating the market, that made it impossible to switch. The technology was known, the concepts were there, however the (middle) management was full of blockers.

In such case you can think about “culture of blockers” in a company. The situation is actually much worst that you can think. Few days ago, my attention was caught by GrabCAD article written by Joe Barkai – Culture eats strategy AND technology for breakfast. Joe paraphrases famous quote – “Culture eats strategy for breakfast”. The origin of the quote actually appears to be Ford Motor Company’s CEO Mark Fields who mistakenly attributed it to Peter Drucker. I like the following passage speaking about acceptance of collaboration tools by engineers:

Obviously, engineers need to see the value in collaboration. They need to agree that spending extra time creating and sharing information, and then applying it downstream, for example, in manufacturing and service operation, is worthwhile. They also need to see value in reusing known concepts, existing designs and available inventory parts. Sadly, many such collaboration and reuse opportunities go fallow. We see design teams ignoring manufacturability constraints and serviceability considerations. We see engineers designing new parts rather than using an existing design, or, better yet, modify a design to allow the use of a part already in inventory or available from an approved supplier.

So, change is really hard for engineers and companies. In my yesterday blog about how to rethink PLM, I put a suggestion to take PLM sales and implementations away from corporate process alignment. There are no perfect companies (although some of my friends from manufacturing companies may disagree). Every company is messy in their own way. We should disconnect PLM implementations from solving corporate politics and internal conflicts. Easy to say, but hard to implement. In my view, focus on providing useful tools that company can leverage fast can be helpful. It can change the way people are implementing PLM.

PLM today is strongly associated with change. The value proposition of PLM was built on company transformation and improvement. What if we can twist it and separate PLM tools and change processes. By doing that, PLM software vendors will supply platforms and tools that can be used by companies. These tools will be smart enough to provide an agile product development environment that can be used by companies. Companies (actually people in companies) will have to work on how to manage changes by themselves and improve product development processes. It is non-stop work. Companies need to perform it in order to improve their processes. Like agile development process. It never stops. You just go between sprints. The positive outcome is to improve the adoption of PLM tools. The negative scenario – it will take PLM tools back into the era of expensive data management toolkits. To prevent that, PLM software vendors will have to innovate by making their products more flexible, smarter and adaptable to data and processes. This is an opportunity for technological competition. Which PLM tool company will like more to manage their agile PLM process development?

What is my conclusion? Change is hard. We should re-think the way we implement PLM and exclude process alignment from PLM implementation. Stop changing people and stop forcing people to take complicated decisions during PLM sales process. Future PLM products will become a foundation for agile change management that will be done by companies. Engineering IT departments will have to change their focus and bring people that can manage change. Just my thoughts…

Best, Oleg

Image courtesy of chanpipat at FreeDigitalPhotos.net

 

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Cloud is not the way to rethink PLM. Then what?

April 1, 2015

CIMdata PLM forum yesterday was a good place to discuss ideas that from a first look can sound a bit crazy. One of them – how to rethink PLM. Wait… you can say. We just came to some sort of understanding about what is PLM and how to sell PLM values to management. There are […]

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5 Attitudes that can kill PLM projects

March 16, 2015

In my experience, I can separate all manufacturing into two large categories with regards to what they want to do with PLM: those who don’t want to do anything with PLM and those who desperately want to implement that, but don’t know where to start. The border between them is blurred. Sometimes you can see […]

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5 signs you need to replace PLM software

January 2, 2015

Happy New Year! This is my first post in 2015. Internet is overloaded with new things, trends and New Year resolutions. It made me think about new PLM. Should you plan a new PLM in a New Year? I think, this is a good theme for a New Year post. To implement PLM is not […]

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What is PLM software replacement cycle?

December 12, 2014

PLM selection is complex process. It takes time to make a decision, evaluate, build a pilot and implement PLM system. I’ve been thinking about how this process can change in the future. Navigate to my Future PLM selection post to catch up. One of my discoveries was the following data point about age of ERP system. […]

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Why all PLM software will be SaaS soon?

November 26, 2014

I’ve be sharing many of my thoughts about how different cloud technologies can be used to implement PLM. Nevertheless, once in a while, I’m also getting comments and questions about acceptance of cloud PLM for large companies. Usually, it comes in the intersection of security and readiness of large manufacturing companies for cloud (SaaS) software. TechMVP […]

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PLM vendors, large manufacturers and public cloud

October 14, 2014

Companies are moving to cloud these days. The question vendors and customers are asking today is how do we move to the cloud. I’ve been asking this question in my post few month ago – PLM / PDM: Why the cloud? Wrong question… I discovered multiple options for customers to start their move to the cloud […]

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PLM implementations: nuts and bolts of data silos

July 22, 2014

Data is an essential part of every PLM implementation. It all starts from data – design, engineering, manufacturing, supply chain, support, etc. Enterprise systems are fragmented and representing individual silos of enterprise organization. To manage product data located in multiple enterprise data silos is a challenge for every PLM implementation. To “demolish enterprise data silos” […]

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