The Value of Value

January 23, 2009

Implementing PLM solution components should not only focus on the transition of As-Is processes to To-Bo. Many companies forget that the real improvement drivers should be ‘Business Value’. In converting As-Is processes, Business Value must be the key driver. Too many we times we observe companies that embark on a journey of which there is no end. The project just lacks focus on business value and without this focus you end up with ‘improved’ processes that help you do the same things faster (or faster wrong). It is my experience that an initiative without a value focus will at some point in time become a discussion what this new PLM technology and its implementation effort actually brought.

To overcome this sub-optimal start, companies should really do an assessment to discover drivers and motives to implementing different PLM solution components. I would call this a kind of Solution Value Discovery (SVD). This SVD basically is the discovery of motives and goals for…. for example PLM. Working with companies you discover many areas of improvement potential. A category of areas may not benefit from PLM per se, because it is concerned with doing the right things right. Let me give an example.

A Company we worked with had a series of ‘Stove Pipe’ processes. Its operational goal concerned a better integration of these processes as it would reduce the risk of program slippage. A single source of information for all key disciplines would enable a more lean process and at the same time an increased  ‘group’ effectiveness. Also better management of schedules was identified a key benefit. A single PLM solution component on its own would not solve process silo challenges. Our recommendation was also the installation of a corporate ‘processes owner’ and for this official to define the ideal ‘To-Be’ starting point and from that point onward start to plan for specific PLM solution components to driving the operational goal….. ‘Reduce Program slippage risk’.

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Introduction

January 5, 2009

Hello, my name is Peter Strookman. I am Managing Consultant at InsidePLM. I work in PLM for over 25 years and have recommend many companies how to best automate their (engineering) processes. I have seen PDM and the rich set of applications that comprise PLM today being born.

In this blog we want to share Insider observations and experience about PLM to a larger audience. Many publish just about technology, we’ll be adding business value into the equation.

Product Lifecycle Management (PLM) is the process of managing the entire lifecycle of a product, from its conception, through design and manufacture, to service and disposal. PLM integrates people, data, processes and business systems and provides a product information backbone for companies and their extended enterprise.

Over the years I have supported many implementations and more important I have worked with companies that asked me to help them formulate strategies WHAT to implement from PLM as a concept and also the WHY to implement this WHAT i.e. the business rational. Implied when we talk about the WHAT we also consider the benefit that this will bring. In other words when we identify an improvement opportunity what would be the metric behind this, how would someone benefit from this. Many companies today, yes still, embark on a PLM journey without a good strategy regarding this WHAT and also the HOW, WHO and WHY…. let alone the WHEN…. and even more difficult.. the for ‘HOW MUCH’… i.e. determine the value of an investment.

In a series of articles I’ll be talking about core solution concepts and also the benefit of these.. or better said the value, which is the sum of the benefit – cost.

Articles concerned you can find on the right against the different categories. At you choice you can set feeds should you want to follow updates. Oh yes.. I am also doing some writing on Twitter.com. You can find me searching for InsidePLM.

Please share wit us your observations…..

Good reading and hope to be welcoming you again soon.

Please note that contributed articles, blog entries, and comments posted are the views and opinion of the author and do not necessarily represent the views and opinions of the management and staff of InsidePLM GmbH.