Product lifecycle, e-commerce & distributed ledger

Product lifecycle, e-commerce & distributed ledger


Once upon a time, product lifecycle was mostly focusing on design and engineering problems. This is not true anymore. These days, product lifecycle management solutions are expanding to marketing, sales, service, maintenance and more. As a result of the expansion, manufacturing companies are looking how to leverage internet, online distribution and e-commerce. The last one is a transformative trend.

6 Manufacturing Trends to Watch Out for in 2016 article defines E-Commerce for Manufacturing as one of the trends to watch in 2016. I found the following passage interesting:

Over the past decade, the application of e-commerce in manufacturing and industrial distribution, has evolved from basic communication and transaction channel between buyer and seller, to an end-to-end collaboration medium between all stakeholders. This collaboration is driven by companies looking to increase sales by offering online product recommendations and promotions, as well as end-customers seeking the rich and personalized online experience that many retail websites offer.

A recent report by Frost & Sullivan, “The Future of Parts and Service Retailing in the Automotive Aftermarket” , predicts that by 2025, 10 to 15 percent of all global parts sales will be made online. This trend will be seen in the Equipment Manufacturing sector as well, especially in international markets.

It made me think about future expansion of One Click Manufacturing methods and the need to improve the way product lifecycle management technologies will be able to handle product related transactions and operations.

You could imagine a typical old fashion environment where PLM system is integrated with ERP to provide an information for procurement and part orders. Online and e-commerce systems can change the way production planning and supply chain operations will happen in the future. Engineering and Manufacturing Bills of Materials will become integrated and will support mechanisms for online demand and supply operations. By doing it, engineering and manufacturing planning will use e-commerce processes. Think about Amazon for Business to imagine what can happen.

One of the technologies that potentially can support an expansion of manufacturing operations online is distributed ledger. Also known as block-chaining technology, it allows to maintain a distributed transaction records.

A block chain, or blockchain,[1] is a distributed database that maintains a continuously-growing list of data records hardened against tampering and revision. It consists of data structure blocks—which hold exclusively data in initial blockchain implementations,[2] and both data and programs in some (for example, Ethereum[1]) of the more recent implementations—with each block holding batches of individual transactions and the results of any blockchain executables.[3] Each block contains a timestamp and information linking it to a previous block.[4]

Everything related to ERP and PLM/ERP integration is in the stone age. It has clunky interfaces and outdated reporting capabilities. It is hard to use and extremely hard to integrate. Interoperability between PLM and ERP is very complex, therefore industry is spending so much effort on integrations. E-commerce for manufacturing initiatives will raise a question how PLM and ERP technologies will support engineering and manufacturing transactions in contract manufacturing and supply chain.

What is my conclusion? In the next few years, manufacturing will be actively exploring what Internet and e-commerce can bring to supply chain and B2B operations. It will demand re-thinking of how product information is managed across a product lifecycle from initial product configuration, production planning, procurement and supply chain. New technologies to manage product data, transactions and integration will be needed to support it. Just my thoughts…

Best, Oleg

Want to learn more about PLM? Check out my new PLM Book website.

Disclaimer: I’m co-founder and CEO of openBoM developing cloud based bill of materials and inventory management tool for manufacturing companies, hardware startups and supply chain.


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