Clarity on PLM

I had the chance to talk with … Razorleaf during a research project earlier this year. Razorleaf helps manufacturers leverage PLM, Design Automation, and other enterprise technologies to improve product development and engineering processes. During the conversation, it was clear that they really understand how enterprise technology can be applied in an engineering environment. They are ready to step in and deliver the enterprise services required to implement PLM. But how much of the “PLM” ecosystem is really ready and capable to implement PLM? In my experience, too few.

What Razorleaf Does

Talking to the people at Razorleaf, I recognized the approach and skillset they use to implement engineering solutions. Yes, they know the products. But they also know how to help companies transform their processes, change their business, align their organization, and all of the other lessons learned from implementing systems like ERP and supply chain management. I recognize these in part from my research, and in part from spending a number of years with Andersen Consulting (now Accenture) implementing enterprise applications. These solutions require more thoughtful implementations than engineering tools, because improving the productivity of an individual is not enough. They have to improve the way the overall business works together. Not an easy task, but that is where the value comes in. This is what Razorleaf does.

How Razorleaf Fits in the PLM Ecosystem

Why did it strike me that they had this knowledge? Because too few resellers in the engineering software market have these skills. What comforted me, though, was that it is exactly those resellers that call on Razorleaf to help their clients. The good news is that the resellers know – or maybe it is their manufacturing customers – that there is more to a PLM implementation. This is likely the reason that other companies such as Kalypso (an innovation consultant with strong enterprise and PLM skills) is on the scene at so many PLM implementations. I find frequently that companies like these are pulled into implementations early on to help augment the skills of the software resellers (and even the vendors themselves).  It also helps explain the importance of a resseler like NovaQuest (a Dassault Systemes reseller with significant PLM experience)

Impliciations for Manufacturers

Why is this important to the manufacturing community?  If you are implementing PLM, make sure that those doing the implementation understand the different between implementing software tools (CAD, CAM, CAE, etc.) and enterprise applications like PLM. It can be the difference between a technically successful implementation that provides little or no business value (what I like to call a failure) and improving your business performance through the use of PLM technology.

So that’s what I hear from Razorleaf (with some additional perspective thrown in, I think it might be as much “What I Learned” as “One-to-One this time). I hope you found it useful. What do you think? What else should I have asked them?

What I learned this week … came from Bill Poston at Kalypso in his reply to a Business Week article titled “Innovation Interrupted – The Failed Promise of Innovation in the U.S.”

BusinessWeek June Cover

Bill’s commentary really got me thinking about a really fundamental question. Do companies have too few product innovation ideas, or are we just not good at turning those ideas into profitable products? It also made me ask a separate question, “is this really a U.S. -centric issue or is this a global issue?”

Overview

The original article, written by economist Michael Mandel, appeared in BusinessWeek in June. In the article, Michael makes some strong assertions that  the U.S. has not been as innovative over the last decade as it has been in the past, and goes further to point to this lack of innovation is a contributor to the current U.S. financial trouble. He points out a number of areas that held promise in the late 1990’s that failed to live up to market expectations, including:

• Biotech
• Alternative energy
• MEMS (microelectromechanical systems)

Michael explains that “the commercial impact of most of those breakthroughs fell far short of expectations,” and points out the information technology (IT) market as the shining star of innovation over the last decade. What Bill picked up on was what I believe is the story within the story. In Bill’s words, “the problem is more often in the basic fundamentals of new product development and commercialization.” Mr. Mandel supports this as well by saying “Many of the technological high hope of 1998, it turns out, were simply delayed” and “if the current rate of commercialization picks up” the U.S. Economy may recover more quickly. Bill comes down clearly on his viewpoint, saying that “We do not believe that we lack the ability to deliver innovation nor that success is necessarily dependent on brilliant insights or strategies” but that companies “need to focus on the fundamentals and make better business decisions.”

My Perspective

Is this an innovation problem, or a product pipeline problem? Or am I just splitting hairs, and the definition of “innovation” should end with “to make a profit?” I think if I looked through my archives I would find that I define profitability as a core part of my definition of innovation. To me, this story (and Bill’s response) is what I hear from manufacturers everywhere I turn:

• We have enough ideas, we just don’t know how to sort through them to find the valuable ones
• We don’t have a process to effectively take innovation and turn it into profitable, commercial products

Digging deeper, we would probably hear:

• We have too much junk in our portfolio / product pipeline
• Our product pipeline is overloaded
• We can’t move new product development projects through the pipeline fast enough
• We don’t kill projects soon enough

What does all of this mean? Like Bill says, most companies are missing the fundamentals. There are very good, proven best practices that a lot of manufacturers have not adopted. Many companies face the same problems. They are solvable. A process for innovation is important, but a process to commercialize that innovation is a fundamental requirement for a commercial business.

Implications for Manufacturers?

The implications? I will keep this brief. Focus on innovation, but don’t just focus on coming up with great ideas. Focus on new product development and (like the tagline of my old company Sequencia) turning product innovation into profits! Sounds simple, but there is a lot of work to do and it is time to get started.

So that is what I learned this week, I hope you found it interesting. Let me know what you think.