PLM outside view and digital transformation – a new name for extended enterprise?

Long time ago, PLM companies brought the idea and vision for extended enterprise. The idea is very simple. PLM tools deployed for an OEM company will extend beyond engineering function to other department and connected companies.

Recently, a new concept of product innovation platform (PIP) was introduced by CIMdata. Although, I think, the concept is very good, the main danger of PIP is to created an isolated spaces – walled garden of PLM providers and can be a mousetrap for manufacturing companies. Check my thoughts about it here.

The following passage from CIMdata commentary speaks how PIP can support extended enterprise.

While the initial implementation of traditional PLM-enabling systems, such as PDM, remains very important, it can be rapidly overshadowed by the cost and disruption from continuing upgrades and deployment to new areas, projects, and programs, as well as by partnerships and acquisitions that bring new, unanticipated mixes of tools and processes to bear. Under these circumstances monolithic enterprise IT applications (e.g., many legacy PDM solutions) are no longer sustainable and robust enough to provide a viable solution. They are difficult to maintain, particularly when an enterprise wants to tightly integrate its product data with its product lifecycle processes and tools. A product innovation platform approach can help mitigate these problems.

Product innovation platforms support extended enterprise data and process integration and enablement—well beyond departmental, typically monolithic implementations. This vastly increases the value of processes, and the information they operate on, to the business.

Earlier this week, I attended webinar organized by CIMdata – Digitalization and PLM – The Next Big Thing or All Hype?

Here are few screenshots I captured and wanted to share with you.

Digitalization is an interesting trend and I was blogging about it before. Check my article and presentation here – Digital Transformation and PLM paradigm shift.

What I found interesting in CIMdata presentation is the idea about PLM vs Digitalization point of view. So, PLM inside and outside view. What it could be and how it can be organized? The former idea of extended enterprise was simple. Just use “single database” paradigm and get everybody to connect. However, as far as outside view can be concerned, to connect everyone to the same database can be a tricky part. Also to consolidate all data in a single database is next to impossible. And finally, what about multiple relationships between participants of digitally transformed companies.

What is my conclusion? Digital transformation is powerful because it is coming to PLM from outside. Processes are going digitized and transformed from traditional email / paper view to new connected digital tools and methods. The key element of transformation in my view is related to end-to-end connectivity, which can bring the next level of efficiency. The danger is to force old “extended enterprise” central database methods into heterogeneous network of companies. The challenge of integration is big and old methods is an easy path to rename extended enterprise slide deck into a new flavored “digital transformation” names. Will it happen? I don’t know. These are just my thoughts…

Best, Oleg

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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.