Agile Software and its partners have made it perfectly clear that innovation is the primary theme driving product lifecycle management (PLM). The Agility 2006 Conference audience, drawn from the automotive, electronics and high tech, industrial products, life sciences, and semiconductor industries, got their fill of conceptual and visionary thoughts on innovation, with such keynote speakers as TCG Advisors' Geoffrey Moore, author of Crossing the Chasm; and IDEO's Tom Kelley, author of The Art of Innovation and The Ten Faces of Innovation.
For today's progressive enterprises, who are doing business in a highly competitive environment, innovation is a priority all on its own, and the sheer pace of innovation is as important as the art of innovation. Enterprises need to examine opportunities surrounding product innovation, as well as business process or business model innovation. Agile Software's tag line, "how products happen," is exemplified by the current product development forces of innovation, globalization, and compliance. These forces are coupled with outsourcing and collaboration imperatives that necessitate a high reliance on supply chain flexibility and agility. Enterprise attempts at simultaneous global product launches, aimed at improving time to market, have shown the need for a mastery of the supply chain for successful new product development and introduction (NPDI) execution. How well Agile Software provides tools and processes to meet the challenges of the PLM market and the expanding audience of companies looking for PLM solutions, is largely based on its ability to find synergy between its technology solutions and the market forces.
With Dassault Systmes' announcement of its acquisition of MatrixOne, Agile Software now has the advantage of being able to emphasize its unique position as the sole "pure play" PLM vendor (see Acquisition Changes Product Lifecycle Management). Enterprises are now realizing that the velocity and direction of product innovation require a PLM structure. Agile Software has honed its message to a sole focus on PLM, with a commitment to customer's PLM requirements being the primary motivation behind Agile's own PLM innovation. A recent Gartner survey said that global spending on PLM applications rose 13.8 percent (product data management [PDM] and PLM only) from 2001 to 2005. The maturity of innovation models such as product innovation, process innovation, marketing innovation, and integration innovation, will drive more enterprises towards a structured PLM approach.
A Compelling Set of Client Case Studies
For the Agility 2006 Conference, Agile Software successfully recruited the assistance of its installed base to provide compelling examples of PLM in action. A partial list of the number and quality of user clients willing to speak to the positive impact of Agile PLM is impressive:
- Harris Corporation, a provider of assured communications solutions, spoke of the difficult transition from product development silos to the implementation of PLM as a corporate practice and discipline within its supply chain operations system (SCOS) architecture hub. Agile PLM is one of the solution spokes, along with Ariba (for procurement), Avnet (for distribution), DHL (for transportation), and Plexus (for contract manufacturing).
- From the consumer packaged goods (CPG) sector, Bayer HealthCare and Bell Sports both spoke of the challenges of getting product to market, the need for shorter product lifecycles, and their visions for implementing Agile PLM within their respective organizations.
- From the automotive sector, Intier Automotive Seating spoke of its transformation from a company with several diverse purchasing and engineering systems, to a company with a common integrated PLM solution for unifying functional business areas and global sharing of business information. ThyssenKrupp Presta, a global manufacturer of steering assemblies and assembled camshafts, articulated the improvement to its change management workflow processes under Agile PLM.
- Siemens AG outlined its motivations and approach for defining the PLM architecture of its various global business divisions. The definition of this architecture is based on a common business process framework. Each business unit has its own business drivers, and differs in its PLM architecture requirements. By systematically defining a reference PLM process and the corresponding reference IT architecture, followed by the definition of a general PLM architecture target, Siemens can better harmonize its PLM applications landscape. Seimens' automation division will number nearly 10,000 Agile PLM users in 25 sites by the end of 2007.
- Conexant presented its view of product profitability challenges in the semiconductor industry, as well as its perspective on how PLM business processes provide improved quality, expedite time to market, increase product throughput, and manage collaborative user processes. Conexant is also one of four early adopters of the Agile Scenario Analytics Platform, which has star schema data marts for use in Agile Product Performance Analytics. The intent is to connect PLM strategy to the company's general performance.
The companies mentioned above learned an important lesson: enterprises need to instill a PLM culture in their organizations. Solutions such as Agile PLM provide a structure for enabling the introduction of more products, with a faster pace to market. These companies also delineated the major challenges facing enterprises beginning a PLM initiative:
- Consolidating and rationalizing existing product data
- Moving away from inherent (legacy) product development processes
- Managing security as it relates to global product development and the innovation process
- Executing PLM as a predefined component of the corporate culture
- Deploying cohesive, scalable, and flexible PLM tools and solutions
Last Mile of Profitability
Agile Software's traditional PLM dimensions include customer needs management, engineering collaboration, product collaboration, enterprise product record data management, product quality and cost management, product governance and compliance, activity-based workflow, configuration management, and product portfolio management. The launch of Agile PLM 9.2, the most current release to date, includes new features for compliance, global product collaboration, engineering change management, and country localization. Agile Labs has recognized that current market drivers, which emphasize product velocity and innovation (which in turn require PLM applications and infrastructure), have brought to light the heightened need for product performance analytics. Agile Software is bringing new functionality to the market, including visibility dashboards which highlight what is happening with product introductions; root cause analyses that help explain the reasons why products might under-perform; and trade-off analyses that allow for what-if scenarios. Coupled with PLM data marts, this new functionality is the genesis of the Agile Scenario Analytics Platform, and is the backbone of product performance analytics. Obtaining maximum value from PLM means balancing operational and strategic PLM initiatives, and linking initiatives to shareholder value. Deloitte Consulting, one of Agile's major implementation consulting partners, has assisted Agile in understanding the core concepts of this linkage, through Deloitte's product innovation and lifecycle management (PILM) transformation roadmap. This roadmap addresses challenges in each phase of the innovation lifecycle, from invention to end of product life. Product performance analytics are necessary tools for better understanding a product's ultimate time to market, and time to value.
Global competition is clearly elevating both the nature and the pace of innovation as a corporate priority. Companies need to consider both product and business process innovation, as methods to differentiate themselves and to grow profitably. Dell has led the way with business process innovation, while several companies, such as IBM and Samsung, have been able to establish and maintain a rapid pace for product design innovation. Agile Software recognizes PLM as an emerging business imperative. It has a unique opportunity to leverage its position as the sole remaining PLM vendor of significance to have a pure PLM pedigree. This differentiation can be attractive to prospects looking for a PLM solution set that is not biased by enterprise resource planning (ERP) or computer-aided design (CAD) legacies. While the PLM vendor landscape has several strong and viable vendor alternatives, prospects with diverse vendor software portfolios should view Agile Software with anticipation.