PLM Strategies-The Elephant Takes its First Step31 Jul, 2005 By: Kenneth Wong
Some keys to successful PLM implementation.
"WHEN YOU ARE DESIGNING A PRODUCT, you should already have its disposal in mind or how you plan to recycle it," says Daratech's CEO Charles Foundyller (PLM Strategies, "Pinning Down PLM," January 2005). There's irrefutable wisdom in his remark. So in theory, the PLM infrastructure should already be in place when a company receives its first order. In practice, however, that's hardly the case. As promising as it is, PLM is still in its early stages. Even Daratech, a staunch believer in PLM, has to acknowledge that it doesn't know of a single, finished implementation in place today (CAD Central, "PLM is Here to Stay, So Get Ready," March 2005). Almost all PLM implementations you see today are reactive, not proactive, undertakings. Hence they all involve legacy data and legacy systems.
Implementation has to start somewhere. And if you're in manufacturing, that somewhere is probably PDM (product data management) or CPD (collaborative product development), because these components have been shown to deliver significant and immediate reduction in costs and manpower. This month, we'll look at some of the hurdles to PLM implementation. Much of the insight is derived from Hitachi Global Storage Technologies and Agile, who were generous enough to share their firsthand experiences.
Figure 1. Products of most PLM vendors, including Agile's (shown here), are already configured to be compatible with widely adopted CAD systems and data-management applications. For this reason, when selecting a suitable PLM system, you should pay more attention to how well it supports your own internal management parameters, QA operations, anticipated growth, and others business practices that are unique to your enterprise.
A Flexible System for the Long Haul
Hitachi GST is the outcome of a strategic merger between IBM's and Hitachi's storage solutions divisions. It's responsible for the hard disks embedded in many popular devices, such as palmOne, iRiver and the Dell Digital Jukebox. Blending two different corporate cultures—IBM's U.S. roots and Hitachi's Japanese heritage—was a task fraught with pitfalls of its own. But the newly formed company was also left the task of assimilating five years' worth of data—more than 150,000 historical CAD designs captured in multiple CAD systems. It needed a system that could consolidate its resources, keep them synchronized, and manage them on an ongoing basis. In other words, it was time for PLM.
Ray Hein, Agile's vice-president of product strategy, always makes sure his clients understand that PLM is an ambitious pursuit. The implementation process has to be treated with "clear objectives, measurable in milestones during different phases," he says. He recommends that if you are a buyer, you verify a number of things first. "Do due diligence, check references, find out from current users what their experiences were, find out the kind of customizations the vendor offers," he says. "People tend to get caught up in features, but [PLM] should be judged based on what your expectations are and how well it meets them."
During its search, Hitachi GST considered a number of products: SAP, MatrixOne, UGS's Teamcenter, IBM/ Dassault's SMARTEAM, ENOVIA, and Agile. It evaluated PLM solutions based on their ability to support its own internal management parameters—for instance, its security procedures, access controls, quality assurance operations, and global infrastructure. Once a potential vendor had been selected, Hitachi GST conducted rounds of tests, prototyping its typical data transactions during multiple test cycles to identify potential bottlenecks and hiccups.
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Hitachi GST had been using a number of CAD systems: CATIA V4, CATIA V5, Cadence Allegra and its proprietary HiCAD. Agile's PLM solutions, like products from most PLM vendors, are already configured to be compatible with widely adopted CAD and data management programs. But Hitachi GST wanted to let its engineers view and modify the different 3D CAD formats in use within a single interface, which Agile accommodated by customizing its solutions. Eventually, Hitachi GST selected Agile Product Collaboration and Agile Engineering Collaboration modules, components of the Agile PLM Suite.
Find a Champion
Heather Hangas, Hitachi GST's director of integrated supply-chain solutions, has 20 years' tenure in IT and programming with a focus on manufacturing planning and execution. After discovering she disliked being stuck behind a desk programming all day long, she began pursuing managerial and analytical roles. "One of the most critical factors in the implementation process is strong management support," she says. It goes beyond simply convincing department heads and executives that the enterprise is ripe for PLM and securing their blessing. During the merger, Hitachi GST operations revolved around four different business units, each headed by a different engineering leader, and each entrenched in its own processes. Under these circumstances, finding a single leader who could oversee the entire project was an ongoing challenge.
Top-tier executive officers are ideal champions. Because there are fewer turnovers at that level, the project remains under one consistent vision. Traditionally, the role of the COO (chief operating officer) has been to oversee and refine business processes. Reporting directly to the CEO, the COO has insights into long-term goals and strategies, and therefore is best equipped to determine the order of implementation. By all accounts, the COO appears to be the best choice for PLM champion. But recent research suggests the CIO may be a better candidate.
At this year's National Manufacturing Week conference, Bob Parker, vice-president of research for Manufacturing Insights, made a number of predictions for manufacturing in 2005. According to Parker, the CIO would no longer be limited to the role of IT assets custodian; he or she would, in fact, be the logical choice to implement enterprise-wise process changes.
More recently, Optimize magazine published "Defining The CIO: An Optimize Research Report" (June 2005). The CIOs, CTOs and IT vice-presidents surveyed rate innovation/new development as the second factor used to judge their performance (the first is increased customer satisfaction). They also indicate that, next to revenue growth, streamlining operations and reducing costs are their top priorities for the next six months.
Don't Dump It on IT
Even though the CIO may be well positioned to oversee the implementation process, it's a danger to hand off the entire project to IT, as most companies tend to do with anything and everything related to installation of new technology. At Hitachi GST, Hangas had to work hard to make people realize this was a "tool deployment project and a business project," not an IT project. IT will play a significant role in testing, training and maintenance. But, unlike a typical IT project, PLM requires dedicated participation from end users and their immediate supervisors.
Don't Throw Away Your PowerPoint
The current business climate in manufacturing is such that companies are constantly facing changes brought on by mergers, acquisitions and outsourcing. It's not inconceivable to walk into a Monday morning staff meeting only to be greeted by a brand-new management team. Even if a company has somehow managed to survive intact, the champion who has been overseeing the PLM implementation may decide to quit and pursue other career opportunities. In any case, when a corporate restructuring stops the implementation in its track, you may need to do what Hangas and Hein call "an internal resell"—pitching the merits of PLM to a new executive or a new team of middle managers. So don't throw away those statistics, staff surveys and white papers that helped you make your point once.
Keep the Momentum
Reinforcing the consensus among PLM authorities, Hein recommends that the buyer create "a roadmap that spans multiple phases." That is precisely why, after a particularly difficult phase, the project needs to be pushed forward. Otherwise, Hangas observes, comfortable routines will set in and "you'll lose momentum." PLM demands monumental cultural and ideological adjustments in addition to organizational and managerial shifts within a company.
Change of this magnitude is bound to meet with some resistance. Hangas has experienced it. She recommends "lots of handholding, extensive training, and explaining [to the engineers] how to use the new system similar to how they had been doing things previously." The more users can mirror the old processes in the new system, the less resistant they will be. The ideal approach, Hangas acknowledges, is to reengineer processes as a new PLM system is being implemented, but that's not always possible.
Manage Expectation, Manage Culture Shock
At a certain point during the implementation, the staff will have to bid farewell to the old system they have relied on for so long. This is, perhaps, one of the most delicate phases. It has to be handled with the right balance of tact and resolve. Otherwise, it can backfire and foster resentment. In Hitachi GST's case, it became a necessity once the deadline for shutting down ENOVIA had been set. Hangas points out you can minimize the impact by issuing fair warning: "Make it clear to the engineers the old system will no longer be accessible to them after a certain date."
This is a critical test for the relationship between the PLM buyer and vendor as well, because both have to work together to ensure that they will reach target milestones on time. Hitachi GST and Agile were confident they could have all the required components in place when the old system was turned off. To their credit, they pulled it off.
PLM's integrated data structure offers everyone involved, from engineers to executives, a 360° view of the enterprise. The multi-angle mega-perspective gives participants unprecedented insights into how different branches interoperate. When different divisions of an enterprise grow and advance in a coordinated fashion, an industrial giant can become amazingly light-footed, dramatically cutting down its time-to-market and operating costs.
But a company, no matter its size or focus, can find PLM components it can benefit from. The fact that many PLM vendors now offer modular solutions that can be implemented incrementally is an indication that they too recognize the need for products that are more flexible, adaptable and scalable, especially for small- to midsize enterprises that are beginning to consider PLM as part of their business strategies. Next month, we'll take a look at one such solution: Agile On Demand.
Kenneth Wong is a former editor of Cadence magazine. He explores innovative usage of technology as a freelance writer. E-mail him at email@example.com.