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Wednesday, January 23, 2019

Getting to Markets of One

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Blog 1-23-19 Many companies pursuing digitalization or Industry 4.0 strategies share a common goal: being able to profitably serve markets of one by making their products and processes more configurable.

Products have been a part of commerce since almost from the beginning of commerce. Artisans used their knowledge of (mostly) local materials and fabrication methods to deliver products locally. Advances in transportation brought new materials and made offering products in distant locales feasible, while also bringing new knowledge of competing products, materials, and manufacturing methods. Advances in communication technology made collaboration more feasible across great distances. Fast forward to today, where we have moved from vertically integrated firms in the early 20th century, to advanced supply chain management and marketplaces to bring the necessary value chain participants together in a collaborative extended enterprise.

The early 21st century brought a new vision, Industry 4.0, that built upon the three generations of manufacturing that came before. One major goal is profitably serving markets of one. This requires an enhanced dynamism in product design and manufacturing well beyond todays value network. The Industry 4.0 vision contemplates dynamic value chains configured with “App store simplicity.”

The whole product lifecycle, from ideation through life, will be impacted. Products that can be configured, not designed from scratch, will rule the day, designed to allow configuration as late as possible in the product lifecycle. Making such products will require manufacturing processes to be much more dynamic, rapidly creating new configurations to help make a wider range of products. One reason for the hype around additive manufacturing is its ability to support this type of dynamism in design and product delivery.

To compete in this new world companies will have to design their products and production capabilities with configurability in mind. On the product side, many of the leading PLM solution providers are developing advanced variant configuration management functionality to help meet this need. These well-defined product families are an essential input for Configure-Price-Quote (CPQ) solutions that help to more effectively sell tailored products to end customers that are by definition both buildable and profitable.

Of course, this is only the beginning. As new design technologies, fabrication technologies, and materials come on line companies will be able to continue this evolution, making more and more complex products, delivered on time and with sufficient profits for business success, while offering a unique customer value proposition to individuals. In some way, we will have come full circle, delivering a distinctive, almost artisanal result from a highly complex value network.

CIMdata will discuss the importance of advanced variant configuration management capabilities and how PLM market leaders are responding at its upcoming 2019 PLM Market & Industry Forum events, which this year will take place in Ann Arbor MI on April 4; Frankfurt, Germany on April 11; Pune, India on April 15; Beijing, China on April 19, and Tokyo, Japan on April 24.

Key takeaways from the discussion on this topic will include:

  • Products evolved from artisanal to mass produced, producers from vertical integrated to leveraging supply chains and marketplaces.
  • Industry 4.0 vision to configure value networks with “App store simplicity” that can help manufacturers profitably serve markets of one.
  • Products and manufacturing processes must be significantly more configurable to support this dynamism.
  • Advanced variant configuration a crucial enabling capability.
  • Used to power Configure-Price-Quote (CPQ) and configure to order (CTO) / engineer to order (ETO) that help deliver profitable solutions meeting customer requirements.

Let us know your thoughts on this topic by sharing them in the comments section of this blog!


If you are interested in this topic you might be interested in a CIMdata white paper entitled "Industry 4.0-A Regional View," which is available for download here.

Stan Przybylinski

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