PLM in economic downturn – Is there a place for second-mover innovation?

How PLM can continue growth in today’s downturn economy? I think, this is time to get back and talk about PLM user adoption. I’d like to raise this question in a very specific way – is there an opportunity for second-mover innovation in PLM today? In today’s market situation, second-mover innovation can open back-core PLM areas and allow the delivery of PLM systems (or components), leveraging all research done previously by the first movers of PLM innovation, who are the majority of PLM vendors.

 Second-mover advantage occurs when a firm who follows the lead of the first-mover is actually able to capture greater market share, despite having entered late. First-mover firms often face high research and development costs and the marketing costs necessary to educate the public about a new type of product. A second-mover firm can learn from the experiences of the first mover firm and may not face such high research and development costs if they are able create their own similar product using existing technology. A second-mover firm also does not face the marketing task of having to educate the public about the new project because the first mover has already done so. As a result, the second-mover can use its resources to focus on making a superior product or out-marketing the first mover…the notion that winners are always the first to enter the market is a misconception. (Wikipedia entry)

Examples include Obama (vs. Hillary), Nintendo (vs. Atari), Oprah (vs. Donahue), and AMD (vs. Intel). Second-movers are able to capitalize on the work done by others and create innovative products at a lower cost. The “early bird may catch the worm” but later birds can dominate marketing and distribution.

Assuming that we are ready to research existing PLM spaces for second mover innovation, what should we focus on as the ultimate functions/components of a PLM system? Presently, I see, Bill Of Material Management as the top candidate for second movers. Most of PLM starts and ends with the management of Bill of Materials. The ability to manage multiple Bill of Materials is a requirement of all customers interesting in PLM-like deployment. 

If the idea is to re-invent the Bill Of Material portion of PLM, what should be improved, in my opinion?:

 Bill Of Material definition: The ability to craft any Bill of Material without a preliminary definition. The Data Model for BOM needs to be open. 

User experience: Flexible rule based user interface, similar to Excel, plus the ability for customization

Multiple Bill of Material synchronization and rules: The ability to manage and synchronize more than one BOM.

Data acquisition: Multiple ways to acquire BOM data – from CAD systems, from other PDM/PLM tools, ERP etc. Practically, BOM can be created from any place.

Bill of Material module encapsulation: To invest into SOA and interoperability of BOM implementation with the rest of the systems in PDM/PLM, and the extended domain, ability to use BOM module with various collaboration systems such as SharePoint, Lotus family etc. 

By doing that, BOM will be converted from existing rigid definition and implementation to modern tools, capable of handling Bill of Materials in various scenarios and user cases. 

I believe implementing such a “back to roots” strategy will allow the creation of significant market advantages for increased user adoption of PLM. Second-mover innovation is relatively cheap and can leverage all market investment done by PLM companies to date. 

Who will do it? This is an open call… 


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