Have you heard about “makers”? If you are in manufacturing business, you probably should pay attention to that. You may hear about “makers movement” these days as a new industrial revolution changing the way people are making stuff. I can recommend you Chris Anderson’s book to read more about that.
New digital technologies are going to change the way we design and manufacturing products. It appears today largely as a new group of manufacturing entrepreneurs, startup companies and small manufacturing firms. PLM vendors are not very successful in providing solutions for SME companies. Historically it was a tough call for PLM vendors. It was too competitive and confusing with major PLM business – large OEMs and suppliers. With new manufacturing eco-system, the situation is getting very interesting. One of the objectives of PLM is to help company to innovate and delivery new products fast. It sounds like a very compelling reason for new manufacturing startups. Read my earlier blog – Why Kickstarter projects need PLM? This is an opportunity for new PLM solutions. However, it looks like something that PLM vendors are missing for the moment – PLM and Manufacturing Startups: Potential Mismatch? We have a complexity of new manufacturing products, multiplied by a complexity of new type of manufacturing processes. It looks like an existing enterprise software doesn’t fit very well a new and growing eco-system of manufacturing companies.
Let me take an example of PLM and ERP system breakdown. The traditional split between PLM and ERP is usually presented as “innovation vs. transactions”. PLM system is responsible for engineering part of the business and takes hands off from ordering by moving business process to ERP. This is works well for traditional manufacturing companies. However, PLM v ERP interplay is a very challenging and complicated process in every company. Would it be the same for new type of manufacturing entrepreneurs? This is a good question to ask… I’m pretty sure that new manufacturing companies can question a need to have multiple systems- they will be looking for some sort of intelligent online solutions that can easy interplay together and cover both engineering and manufacturing piece.
My attention was caught by Fortune article – In B2B e-commerce, Alibaba has solved the one problem Amazon can’t. Read the article. I found it very interesting. It is not about PLM. However, I captured a passage that speaks about B2B and supply chain communication.
But there is one true giant in the category: Alibaba, the Chinese retail darling that last week revealed plans for a $21.12 billion initial public offering, which has dominated in B2B e-commerce. I was reminded of this over the weekend while listening to Planet Money’s entertaining explainer of the Alibaba wholesale market. Through Alibaba.com and 1688.com, the company provides to people everywhere access to the Chinese supply chain. This means tinkerers, builders, entrepreneurs, and small businesses can order custom motors and parts from Chinese factories without having to travel there, find a scout, and forge a relationship with a manufacturer before doing business. It opens up the world of international suppliers to people who wouldn’t normally have access to it. They can buy in bulk through Alibaba, which acts as a trusted third party, vouching for the transaction.
It made me think about a potential of PLM software to get connected to online e-commerce systems to process orders and even more- optimizing product design and engineering solution based on that. It probably sounds crazy. However, who knows… Many things that we knew as a separate parts in the past, now unified as a single products. Think about iPhone, which replaced many existing devices. Today’s Apple Watch and Apple Pay announcements are hinting about future transformation of well-known habits. There are some other examples as well.
What is my conclusion? I like to quote Mark Andreessen for the conclusion – “Software is eating the world”. There are lot of traditional system breakdown that are going to be transformed and disappear in the future. What looks like a right split between product innovation (PLM) and order-transaction (ERP) today, can be challenged in the future. So, who knows? Maybe tomorrow PLM systems will order parts from Amazon B2B e-commerce web services? Just my thoughts…
Best, Oleg
