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Product and service quality as perceived by the customer is of supreme importance in today's business climate. This is one of the main reasons why companies continue to develop systems, strategies or programs, which would not only enhance the company's operations but would also let the company adapt with the continuous change in the business field.
The paper will discuss mainly about the Product Lifecycle Management or also known as PLM. The disadvantages were not given but the key advantages were enormously cited. Details about some examples were also enumerated. The history and development of PLM were not discussed, as it does not add any justification to the written information.
Since the change and growth in the business world is unpredictable, a catalyst for change and progress is needed. Product Lifecycle Management or known as PLM is created for an improved management in the production cycle and for an integration of processes, procedures and systems of a company. What is PLM? What benefits can a company gain from it? What are the particulars of the SAP PLM solution? Who are these companies who chose to adapt PLM?
Product Lifecycle Management
PLM is the deliberate business method that uses steady set of business solutions that contributes mainly on the joint establishment, management, distribution, maintenance, and application of product identity information that is used across extended enterprise, which primarily results into the advancement of the people, the operation, and the business systems. The solutions pertained include the dramatic reduction in time and cost of product changes, the significant decline of product production process and lead times, the decreased scrap and repeat during production, and the improved productivity in design engineering. PLM gives way to the distribution of more innovative and dynamic products and services, the reduction of costs, and improvement of the market quality. PLM also helps the company maintain a more comprehensive, and complete relationships with the customers, suppliers and business partners.
PLM (Saaksvuori and Immonen, 2002) is a holistic business concept developed to manage a product and its lifecycle including not only items and documents, but also the results of the analysis, test standards, environmental factor information, quality specifications, engineering criteria, alteration of orders, manufacturing processes, product presentation data, material suppliers, and so forth. PLM makes it possible to command the whole lifespan of a product and the information connected with it.
There are three primary concepts that can be implied when discussing about PLM. First, it is the general, protected, organized access and use of product definition information. It is mainly about managing the digital representation of an information. Second, PLM is about the integrity of the product definition and the maintenance of that related data throughout the cycle of the production. Third, it is about managing and maintaining business processes that is used to create, utilize and share the information.
PLM is simply the system used by a company to effectively manage their products when it is produced. PLM therefore enables the company to completely take control of it products. This gives way to better products that market faster, and better support of the customers to the products. The worth of a product is maximized with the help of PLM. Low-cost ways can be found to extend the products' revenue-generating lifetimes with the use of accurate, consolidated information available. Furthermore, PLM provides transparency on the production lifecycle. It offers the visibility about what the products undergo during its entire lifecycle.
PLM is useful for developing the internal communication of the company and communication between external companies in the same network. The improvement of the communication between the separate departments of the organization and other external interest groups is the most important single benefit from a functional product lifecycle management system.
The system can also be used to improve direct communication, to transfer the files and conversions between different file formats, which are important when different types of software are used for the processing and preservation of the product data.
The product lifecycle management system gathers various kinds of information on the daily operations of a manufacturing company, in example, the documents and components. When PLM has been used, the utilization of information gathered begins by the use of reports based on the information in the database.
Aside from the benefits mentioned above, PLM also provides three major advantages namely: Product definition, production definition and operational support.
Product definition includes the entire set of information that defines how the product is designed, manufactured, operated, or used, serviced and then retired and dismantled when it becomes obsolete. The product definition is updated throughout the entire lifecycle. Product definition is an intellectual asset that must be created, captured, maintained, and leveraged.
Product production refers on the deliverable product-typically a physical asset such as a car, toy, appliance, airplane, or plant. It includes the activities involved in the production and distribution of the product.
Operational support focuses on the management of the enterprise's core resources such as the finances, the manpower and other resources required to handle the enterprise.
However, it must be put into consideration that product lifecycle management system alone will not improve the operational effectiveness of any company. It is only a tool that can be used to remove the physical distances, to surpass the daily work difficulties and to break through separate organizational interfaces. The employees and organizations use it to intensify the work. The use of a PLM system provides opportunities to develop the rationality and cost efficiency of the whole supply network. The immediate economic advantages of a PLM system can be expressed in terms of saved time and increased effectiveness in daily accommodation, which accumulate into cash assets. These cash assets result in declining quality costs and in the reduction of tied-up capital. Moreover, the pecuniary advantages also include a large group of indirect but major benefits such as quicker market time of products and quicker time-to-react to changes in the market and a better margin for sold products. All these advantages obtained from better quality of operations, and from more efficient and quicker operation the product and order delivery processes.
SAP PLM Solution
Creating and delivering innovative and market differentiating products and services can be one of the ways to survive the ever-changing global environment. SAP PLM Solution creates an allied environment to organize, trace, and control all project information and products over the complete life cycle through a highly driven extended supply chain. SAP PLM solution has six fully integrated environments namely:
The program and project management, which involves the business or project planning and the analysis of profitability
The Life cycle data management, which involves the engineering or the product framework management, the change management or the configuration, and the system integration management
The Life cycle collaboration, which includes document sharing of the allied engineering partners in design, management and maintenance of products
The Asset life cycle management, which involves the advancement with plant maintenance, service management, documentation of equipment and work clearance
The SAP Production lifecycle Management application gives a 360-degree-support for all product-related processes-from the first product idea, through manufacturing to a product service. With the SAP PLM solution, the product developing processes and systems can be optimized to hasten the products growth in the market with an ensured compliance to the industry, quality and regulatory standards. SAP PLM gives organizations the unique ability to perform the essential business processes with modular software.
(Aberdeen, 2007) "Best-in-class" companies were recognized as being four times more likely to operate product lifecycle management (PLM) technology to innovate their product development process. The report acknowledged Best-in-class companies as those whose five-product development performance falls into the top 25 percent if compared with their competitors. It was cited in the report that the organization acquired a 19 percent product revenue increase; a 15 percent product cost decrease; and a 16 percent product development cost decreased from enhanced product modernization, product expansion, and engineering.
Another famous company that uses the PLM is the Siemens Technology. The company recently unveiled their latest product named, High Definition PLM (HD-PLM) technology framework, which has the main feature of making informed decisions more efficiently and with a higher level of confidence.
PLM serves is created to be a means of enhancement of processes and organizational relationships that gives way to a totally innovative and measurably improved business.
Today, PLM dominates considerable areas of business development in terms of operations' improvement. It's not just a program and project management processes. It has become a necessity to effectively manufacture the product or plant, and operate in the field. PLM helps identify, perform, assess, and handle key product-related business processes.
The following are considered as advantages of PLM: time saving, improvement in quality, and reduction of tied-up capital. Also, it bring benefits in terms of lower costs, higher plant uptimes, and quicker delivery.
Reports have shown that PLM made a big difference in the operation of the company. Improvements were particularly seen in terms of product development, product cost, and product development cost.