Clarity on PLM

A quick peek into some research on … the importance of good supply chain information in A Risk-Based Approach to Component and Supplier Management: Mitigating Risk with Component and Compliance Intelligence. The research discusses how good intelligence on the supply chain can help mitigate risks such as counterfeits and fakes, obsolescence, and regulatory noncompliance. The report provides examples from a number of leading manufacturers including defense contractor BAE Systems, electronics industry service provider Jabil, and high tech company ON Semiconductor.

The Research Findings

There are a number of important observations based on interviews with the the three firms that agree to participate in the interviews. Please read the report for the full details. The main thing that stuck out for me was the need to build a framework that allows companies to leverage component and supply chain data to make good business decisions. This is critical to risk management, and helps companies avoid or reduce the impact of a number of common supply disruptions.  As the report finds, “The key is to arm the decision-maker with the right information in time to act strategically.” Like so many other aspects of product development and product lifecycle management (PLM) I have studied, supply risk is best addressed early, when there are still more options available.

The framework of information is not trivial, and requires an investment by the manufacturer to ensure complete, consistent, and accurate information. The elements of the framework include data from both the manufacturer and the supporting supply chain. For example, a good framework combines information from multiple sources, putting the supply data into the context of the company’s products and offering potential alternatives when issues do arise. This data can include:

• Bills of Material (BOMs)
• Approved Vendor Lists (AVLs)
• Approved Material Lists (AMLs)
• Component Specifications
• Supplier Data
• Obsolescence  Notifications
• Controlled Substance Lists
• Compliance Certifications
• Bills of Substance (material composition for purchased components)
• Notifications of Identified Counterfeits
• And more

Having a clean, trusted source of information helps companies identify risk, analyze the potential impact, and mitigate the risk effectively. I can’t imagine summing up the findings from the research any better than one of the company thought leaders I interviewed for the report who said “Knowledge is power, the more you know the better decisions you can make.” Well said, and quite true.

Implications for Manufacturers

I often write about the importance of good software to help manufacturers maintain product profitability. This research is a good reminder that having the right information is just as important. Sourcing product and supply chain knowledge is a frequently overlooked aspect of a solid PLM strategy, as I mentioned previously in my report on Making Engineering Efficient – with Electronic Reference Information. Having the right information – both internal and external – in a framework where it can be applied to make business decisions like risk management is an important tool in managing risk, but also to bringing profitable products to market in a broader sense.

So that was a quick peek into some recent research on mitigating supply risk with good supply chain intelligence, I hope you found it interesting. Does the research reflect your experiences? Do you see it differently? Let us know what it looks like from your perspective.

Please feel free to review a summary of this and more free research and white papers about PLM and other enterprise software for manufacturers from Tech-Clarity. The full report is also available for free courtesy of IHS.

I had the chance to talk with … a couple of vendors this year about Quality Lifecycle Management, or QLM. I posted earlier about What I Learned: Expanding PLM’s Pervue – Quality and Risk Management and promised to follow up with some more detail on the vendors. Here are my thoughts on my conversations with Dyadem. One early caveat is that Dyadem – while they support the QLM approach to quality – refers to themselves as a “Quality Risk Management” solution provider as opposed to QLM.

What do they Do?

Dyadem has used the terms “Risk Lifecycle Management” in addition to “Quality Risk Management” and QLM to describe what they do. In my conversations with them, I have found they are very thoughtful about what they call their solution. What is common to the descriptions I have heard from them are the terms “risk” and “quality.” Why? Because risk and quality are intrinsically tied together. Poor quality management results in excess costs, a very hard metric to get a handle on. Poor quality also opens companies up to significant risks in the market – from poor customer perception, high repair/warranty/replacement costs, or from potentially catastrophic results of product failure leading to legal action.

So Dyadem helps companies reduce the cost and risk of poor quality. How? For one thing, Dyadem tries to help companies learn from their repeated errors. Many quality issues follow a pattern of:

• Create a condition that leads to an error
• Make an error
• Correct the error
• Repeat

What’s missing? Learning from the error, and changing the underlying condition that led to the problem. I know this doesn’t sound like rocket science, but it is probably the core element of QLM – and one that is dreadfully missing in most manufacturing companies today. Corrective action needs to be applied to the underlying condition as opposed to the error itself. This is what the quality “lifecycle” is all about – feeding the cause of errors back to engineering so they can be designed out of products and/or manufacturing processes.

What do they Offer?

In short, Dyadem offers solutions that help companies identify their errors and put in place quality and risk management processes. Identifying errors comes from analysis of manufacturing and quality data. By crunching the numbers coming from the underlying manufacturing systems (such as ERP) they can help identify recurring problems. In addition, Dyadem offers solutions to put in place quality lifecycle processes including:

• Failure Modes and Effects Analysis (FMEA) – to identify potential and recognized errors and put in place corrective action to prevent them, preferably early in the product design cycle
• Fault Tree Analysis – to identify potential hazards that can lead to an error
• Process Hazard Analysis – to identify risks or hazards based on processes and put in place prevention measures (an example of this technique is HAZOP)

A trained eye will also notice that most of these techniques are adopted to comply with regulatory mandates in certain industries, as clearly Dyadem helps companies comply with quality and risk management regulations in addition to helping them reduce the cost and risk associated with poor quality.

Who do they Work with?

Dyadem works with discrete manufacturers such as automotive, aerospace, and medical device companies as well as process manufacturers like pharmaceutical companies. In fact, Dyadem offers separate versions of their flagship Stature product for process and discrete as well as some industry flavors of their other solutions, such a their FMEA-Med tool which (not surprisingly) helps medical device companies develop failure modes and effects analysis documents, which are important for FDA validation.

So that’s what I hear from Dyadem, I hope you found it useful. What do you think? Is quality a missing link in PLM? What else should I have asked them?

I had a chance to talk with… Hardeep Gulati at Oracle about the recent Agile PLM 9.3 product release. Product analytics has been, and still is for the most part, a gap in the PLM market.  So considering Oracle’s acquisitions of Hyperion and Agile in recent years, it’s not a surprise that the Oracle 9.3 PLM release is focused squarely on this area. The challenge is making this product intelligence consumable to each of the different roles along the value chain – engineering and design, manufacturing and supply chain, marketing and sales. Make the information easy to access and relevant, or you’ll have a nice analytics tool that no one uses. Oracle realizes this and has also focused the release on enhancing an already good (based on conversations over the past year with Agile users) user experience by adding “productivity tools” – for example drag and drop, inline editing, and more personalization. The company will focus their next release on leveraging their portal technology for a common user interface – a critical component of their strategy.

What do they offer?
More specifically, the product lifecycle analytics solution Oracle is offering is focused on risk management - i.e. product quality, obsolete parts, supplier’s financial liability, new sourcing options, design process, demand volatility, and where exposure is in a product portfolio. Future focus will be on deeper customer analytics during the front end of innovation, and manufacturing intelligence.

In addition to analytics, Oracle has focused on integration. We’ve heard about AIA (Application Integration Architecture) as the platform for weaving together the numerous assets Oracle has acquired, including Agile. This “backbone” (or, FUSION middleware) is an open platform that can integrate the heterogeneous environments (other PDMs, best of breeds) that are so prevalent in product development. Oracle even offers a “PIP” (process integration pack) for integrating Agile to SAP. With the 9.3 backbone you can create product development-specific services (e.g. product cost management), and have scripting available to support integration to components and segments of the product lifecycle.

How Does it Fit into the Ecosystem?
With the lack of rich product analytics in the PLM world, this is a welcome announcement. If you are looking for better product performance intelligence at all stages of the product lifecycle, Oracle’s new release warrants a look. This announcement should accelerate competitive efforts in this arena – IBM with Cognos (and it’s recently announced closer partnership with Siemens PLM), Siemens PLM, PTC, and SAP (who is working to integrate the acquired Business Objects capabilities into its product intelligence platform). I expect the next 12 months to bring rapid improvement from these and other PLM vendors, from better product portfolio analysis to product, manufacturing and supply chain analytics.

So that’s what I hear from Oracle. What do you think? What else should I have asked them?