How to disrupt PLM consulting and services

Industry is transforming these days. As part of business transformation, engineering and manufacturing software vendors are changing the way software is developed, delivered and used by customers. Massive transition into services and subscriptions, combined with cloud software delivery create many new opportunities to change the way consulting, service and training is delivered.

PLM consulting and advisory is heavily focusing on organizational business transformation. These projects are typically involving understanding of manufacturing company business model and product development process and combining it with the knowledge of PLM tools. However, the last one is usually not in the focus of PLM consulting. At least not as it is advertised. PLM consulting is usually advertised as vendor neutral. And it should be that way.

Things are usually getting very vendor and PLM software dependent when it comes to implementation consulting and services. PLM projects are considered very labor and service intensive. Every PLM product is advertised to be insanely flexible and configurable. However, when it comes to implementations, customers are demanding high level of software vendor or consulting partner involvement.

So, industry is moving towards new tools and business models. At the same  time, many aspect of PLM consulting and business services are remaining the same.

Inc. article The Business Consulting Industry Is Booming, and It’s About to Be Disrupted () speaks about many aspects of consulting activities and potentials to change driven by modern industry and technological changes – billable time, high margin and time-bound value are conflicting with knowledge commoditization and wide availability of the information on the internet. Read the article. Here is my favorite passage:

The first to feel the detrimental effects of disruption will likely be the large research and advisory firms such as Gartner, Forrester, and IDC. With models that rely on armies of analysts, PDF reports that become outdated the moment they’re published, and significant annual subscription fees, these firms embody the most significant vulnerabilities of the larger consulting industry. And this is just the tip of the iceberg. Just about any consultant or firm that conducts primary or secondary research will see the value of these offerings — and clients’ willingness to pay for them — diminish significantly.

While many consultants and consulting firms have established practices advising clients on strategies to leverage disruptive trends and technologies, few apply this to themselves. Investing in the technological innovations and next generation business models is a fundamentally paradoxical concept in an industry driven by billable hours, billable days, and closely held best practices in the form of “knowledge capital.”

Repeatable processes, models and tools are indeed important for efficiency, scalability, and profitability. Yet the physical delivery of these staples of the trade remain chained to an entrenched business model. A new approach is needed if the management consulting industry — let alone individual firms and consultants — will have the chance to unlock the next phase of its evolution and value, before some dramatic external threat forces the issue.

It made me think about transformation of PLM implementation services and consulting. These services are repeatable and can be reapplied to every company. Of course, every company is different in some kind. But the difference often comes in a way or established processes. The biggest complexity is people-bound processes that very hard to change. On the side of business and product development, there is high level of re-usability in implementation practices. Configuration management, change processes and design to manufacturing practices can be common and shared for specific industries. How to apply these knowledge to a specific company in a best form is still a science of PLM consulting.

How to make these PLM consulting  measurable and easy to replicate? This is a question that can drive a change in PLM consulting and service industry. Re-usable templates and implementation practices combined with new technologies and tools can drive differentiation in PLM implementations and also drive fast ROI and lower TCO of PLM systems.

What is my conclusion? PLM consulting and service is very labor intense, dependent on unique knowledge and availability of knowledgable people. In my view, it is the biggest factor preventing PLM vendors from scaling their business. I’m not talking about top OEM implementations. These companies are paying lot of money to PLM vendor and will continue do it in foreseeable future. However, for many middle size and smaller manufacturing business, PLM practices are our of reach and dependent on  PLM consulting and service offering that cannot scale much in its current business status quo. 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. My opinion can be unintentionally biased.