Industry Summary Articles

As crucial components of the enterprise information ecosystem, Product Lifecycle Management (PLM) and Enterprise Resource Planning (ERP) are yin and yang. They are complementary to running a business, and should not be treated as competitive—as they too often are.

In developing competitive new products and getting them to market, both PLM and ERP play a critical role, hence the great value in integrating product development processes and data flows among them. Similarly, there are many hidden problems if one is implemented with little regard to the other.

Every large industrial company manages its products and their development with some form of lifecycle-based strategy, i.e. PLM, whether via a specific set of PLM solutions or through manual processes. Increasingly, PLM automation is found in medium-sized businesses and even small ones. It is also true for commodity-based businesses that compete on price, delivery, and packaging instead of product features. In short, PLM helps companies create innovative products, manage information generated throughout their lifecycles, and provide a platform for reusing intellectual property for business advantage.

ERP helps companies get products to market more cost effectively. ERP was developed to closely monitor inputs and outputs of the production of tangible goods—expenditures as well as the consumption of resources. To complete the picture, ERP is often linked to Manufacturing Execution Systems (MES), which controls production processes.

Each has critical roles, but coordinating their interaction is no easy task. Other than integrating PLM, ERP, and MES, there is no way to deal with the constant change occurring throughout product development and production due to changing requirements, to ever-evolving market demands, and to errors in design or manufacturing.

When these three are integrated (not just manually linked or connected), users of each solution get needed information from the other two on-demand and verified. It’s not just a matter of cost-effectiveness; given the dynamics of today’s rapidly evolving markets and technologies, there is no other way users and decision makers can keep up. The integration challenge is often tangled by the rise of poorly integrated tools to support processes such as product change. Well-managed business operations require that information be shared appropriately across all product development tools in use throughout the extended enterprise.

Product-related data for this most complex of integrations can best be managed with PLM. It is the core of the development and end-to-end lifecycle management of today’s new products. Only PLM provides the flexibility to ensure that every step taken to meet product requirements is visible and that no change or cost driver is hidden from decision makers.

CIMdata has the necessary skills and experience to explain the necessary strategy for bringing PLM, ERP, and MES together to form a complete product realization strategy. This was the subject of my Leadership Webinar “Creating Value When PLM and ERP Work Together,” on which this article is based…

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