PLM means please learn more

Earlier this summer, when a sudden gas leak threatened to blow up the building where I work, I decided to take an interest in fire safety and security.

The day the gas leak happened, there was little to no organization in our evacuation from the building. There was no alarm. We all smelled the gas. We looked out the window and saw other people fleeing for their lives. We decided to join them, and apparently, only much later did the fire department instruct staff here to broadcast an announcement that we should leave. Fortunately the situation was contained, but it was obvious we needed some ownership and structure in place to deal with potential disasters. That’s why, when our property managers soon asked for volunteer fire wardens, I signed up. That, and because I thought we might get little helmets.

I bring this up because I think corporate enterprises will likely find themselves in a similar scenario if the industry doesn’t figure out who should be in charge of the product lifecycle management (PLM) in their organization. This is the important stuff, the processes and workflows that determine which companies score a time-to-market advantage with new offerings — the companies that want to keep better track of all the good ideas that frequently get lost in the knowledge management shuffle. It means bringing together the engineering department, the R&D people and nearly everyone else.

It’s a big job, an onerous job, and it combines the task of picking the best PLM software and making sure the rollout of the technology helps move the business strategy forward.

In other words, it’s the CIO’s job.

According to AMR Research, however, the answer isn’t quite so obvious. In a recent research note, the firm says that new product development and introduction (NPDI) is rarely managed by a single person, and software vendors who operate in this space are trying desperately to figure out who the actual buyer is.

“Someone needs to take the reins of the business processes involved,” the note says. “There is a real danger of bad technology investments and, ultimately, market failure of products.”

This brings to mind Chrysalis-ITS, which recently laid off more than 100 people after design problems in its Luna chips led to a shut down of its semiconductor division.

There is more than enough activity in this space to suggest that having products to deal with it won’t be a problem. A few months ago EDS spent US$1 billion to acquire a controlling interest in Structural Dynamics Research Corp. (SDRC) specifically to further its PLM strength. It may be too early to predict a market leader, but one of the most serious contenders is SAP, which has delivered a mySAP product that is already taking root with major customers. It will be interesting to see if one of them, Compaq, will extend its use of the product if and when the company merges with Hewlett-Packard Co.

In an ideal world, those who will be most directly affected by process and workflow changes would drive changes themselves. But intellectual fiefdoms like R&D and engineering are really parts of a whole, and it takes someone outside them to really lead the project. This is somewhat different than customer relationship management, where it is becoming clear that strategy has to be developed almost by committee.

At this point, you have either fallen into the camp that says CIOs should stick to technology and leave business leadership to the CEO, or you realize that having more knowledge of the impact of technology on an organization means the CIO is the best person to lead in areas like PLM. Whereas the benefits of CRM can take some time to measure — metrics like market share, repeat sales, etc. — successful PLM generates great products. For CIOs who want to make the leap to strategic decision-maker, PLM may prove the better training ground.

sschick@plesman.com

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