A PROSTEP White Paper – Download here.Contents:
- Vendor-neutral consultants as guides to the PLM market
- Digital transformation creates a need for action
- Management discovers the benefits of PLM
- Permanent change requires a clear strategy
- Systems require the right methodology
- Creating trust based on technical expertise
Many companies are wondering whether they and their PLM system landscape are still in a position to cope with the demands made on them by digitalization. They often assume that everything will automatically work better with a new PLM system. But the key question remains: are they using their PLM applications correctly and how can they best put their PLM applications to use. This is why, prior to making a decision to purchase a new PLM solution, PROSTEP‘s strategy consultants work together with customers and analyze which PLM capabilities they already posses and which capabilities they need for the next step towards a digital future. The experience gained over the course of many projects means they are familiar with the PLM world in manufacturing industry and incorporate this experience into their strategy consulting.
There is a great deal of uncertainty in industry when it comes to the future viability of their PLM infrastructures. Paradoxically, this is due to the fact that many companies now recognize the key role that PLM will play in their digitalization initiatives. “They see that PLM can help them bring innovations and customer-specific developments to market faster, but they don‘t know exactly how,” says Martin Strietzel. Companies that already have an extensive PLM infrastructure in particular are giving thought to the next steps that need to be taken to ensure that their infrastructure will still be viable in five or ten years‘ time.
“They see that PLM can help them bring innovations and customer-specific developments to market faster, but they don‘t know exactly how.”Martin Strietzel, Head of Strategy & Processes, PROSTEP AG
This uncertainty is fueled by a number of different factors. On the one hand, many PLM installations are showing their age without the hoped-for rationalization effects being reflected in the figures. Some companies doubt the long-term suitability of their system because PLM vendors have turned their attention to new topics such as Industrie 4.0 , the Internet of Things (IoT) or systems engineering and would appear to be neglecting traditional PLM-specific tasks. It is unclear whether other vendors have the staying power required to keep pace with the investment offensives of their competitors. “It is difficult for decision-makers in industry to remain immune to this uncertainty and pursue their digitalization strategy confidently and in a professional manner,” says Strietzel. “Either way, you first have to develop, describe and communicate your PLM strategy within your company.” Many strategies often have to be updated simply because digitalizing a company‘s product portfolio gives rise to new requirements and companies want to supplement their smart, connected products with data-driven services. And suddenly you find yourself smack in the middle of topics like the digital twin, end-to-end digitalization and artificial intelligence.
In recent years PROSTEP has provided advice to many companies from a variety of industries in the context of defining their PLM strategy and restructuring their existing PLM landscapes. Although these are primarily larger SMEs from the mechanical engineering, plant engineering and automotive supply industries, manufacturers of automation technology, logistics systems, shipyards and companies from the aviation industry are also making use of the services provided by the PLM consultants. As guides and strategists, they are not only involved in large-scale projects with an investment volume of several million euros but also in much smaller projects at manufacturing companies with just a few hundred employees.
Vendor-neutral consultants as guides to the PLM market
Many consulting projects are triggered when it comes time to replace an existing PLM system that is not being developed further and no longer meets the customer’s requirements, or a system that employees and management are simply no longer happy with. We will come back to the reasons for this later. In their search for a new solution, they come across an offering that is hard to fathom despite – or perhaps due to – the consolidation of the PLM market.
“Customers contact us as vendor-neutral consultants because the system solutions from major providers are now so comprehensive and also so similar that they don’t know which would be best for them. They know that they’ll be tied to a partner for years and want to be sure that they’re making the right decision,” says principal consultant Andreas Trautheim-Hofmann. Sometimes a customer wants a neutral body to confirm a decision that has already been made to ensure that all requirements were given due consideration when the system was selected.
“Customers contact us as vendor-neutral consultants because the system solutions from major providers are now so comprehensive and also so similar that they don’t know which would be best for them. They know that they’ll be tied to a partner for years and want to be sure that they’re making the right decision,”Andreas Trautheim-Hofmann, Principal Consultant
Customers not only want to know what the PLM solutions do but also how efficiently they themselves will be able to make use of PLM. It is in this context that lead expert Peter Wittkop sees a great need for consulting services at SMEs in the mechanical and plant engineering sectors in particular. “While there is a lively exchange of PLM-related information between carmakers and automotive suppliers in the standardization bodies, engineering companies operate more independently. What they often lack is a comparison to other companies, and when they do take a look over their neighbor’s fence, the grass always looks greener on the other side. We provide the basis for comparison by analyzing their PLM capabilities and measuring them against best practices in industry.”
Digital transformation creates a need for action
The priorities in PLM consulting projects differ from industry to industry depending on where the real problems in the companies lie. Peter Wittkop reckons that the need for action in the mechanical and plant engineering sector is mainly due to the changes being made to business models and the need to feed information from the product lifecycle back into development. A leading German machine tool manufacturer that PROSTEP is advising is a perfect example: “The company would like to use operating data from the field to provide new services, but its PLM landscape does not yet provide the level of end-to-end digitalization that is needed to track the lifecycle of the machines through to the operating phase,” explains Wittkop.
In the shipbuilding industry, with its numerous authoring tools and data storage systems, one of the concrete requirements that customers want PLM consultants to address is how to design cross system and cross-company processes in engineering, production or purchasing. It is not something that can be solved with a few interfaces; the systems and processes need to be integrated better, as PLM consultant Lars Wagner says: “In my opinion, the greatest need for action is when a document based approach is replaced by a model-based approach, because the processes have historically been geared to handling documents. If you want to change that, you need a mind change in the organization.”
“In my opinion, the greatest need for action is when a document based approach is replaced by a model-based approach, because the processes have historically been geared to handling documents…”Lars Wagner, PLM Consultant, PROSTEP AG
In the automotive industry, PLM consulting projects are being driven by new topics such as requirements management or systems engineering and the associated need to change processes and integrate new systems. Principal consultant Mario Leber cites as an example one of the world’s leading suppliers of steering systems to the automotive industry, who he advised when it came to selecting a system. The company needed a new PLM system because the existing solution was not being developed further and provided insufficient support for requirements management, systems engineering and integrating production planning.
Management discovers the benefits of PLM
Where a customer’s real PLM-related problems lie always depends on who in the company is being asked or who is doing the asking. “The concerns of the head of the CAD department will be different to those of the person heading up development, who is also responsible for electrics/electronics and software and may be wondering how to support cross-disciplinary requirements management or model-based systems engineering (MBSE). The higher up the management hierarchy you go, the more exciting it gets,” says Mario Leber. With the momentum provided by digitalization, PLM has gone from being a specialist topic to a strategic issue, which means that it is also coming to the attention of those in the top management echelons – and not only at SMEs.
“The concerns of the head of the CAD department will be different to those of the person heading up development, who is also responsible for electrics/electronics and software and may be wondering how to support cross-disciplinary requirements management or model-based systems engineering (MBSE)…”Mario Leber, Senior Consultant, PROSTEP AG
Leber has just received a query from the supervisory board of a leading plant engineering company that wants to redefine its engineering vision with the help of PROSTEP. This type of top-down project initiated by management is the ideal starting point for strategic consulting as it builds on corporate strategy and needs to have the support of top-level executives. The path taken by a PLM consultant however often moves from the bottom up: A project dealing with a specific topic leads to other projects because, thanks to their technical expertise, the consultants become the customers’ “trusted advisors” for any PLM-related topic. “That is something I take great pride in,” says Peter Wittkop.
As a best practice, however, it is the head of development who initiates consulting projects because companies have come to understand that PLM impacts on the overall organization and the central processes. This is progress compared with the past, when PLM projects were mostly driven by IT, says Leber. “But there are still companies where IT and specialist departments see each other as adversaries. I think that is a fundamental error. The IT and specialist departments need to develop an overall strategy for PLM together as partners.”
Permanent change requires a clear strategy
Product information is of strategic importance to manufacturing companies. Companies therefore need a PLM strategy enabling them to respond in an agile manner to the challenges posed by information logistics. Many have created what they thought would be lifelong PLM infrastructure and now realize that they will not be able to adapt this infrastructure to the significant change in circumstances, constraints and requirements brought about by digitalization: “It’s not only the shipbuilding industry that has to adopt an increasingly global approach, collaborate with an increasing number of partners and address new topics such as requirements management, system development and how to handle software configurations,” says Lars Wagner. “However, existing collaboration models between specialist departments and IT are often not powerful enough to do this. In a best case scenario, this is bridged by shadow IT; in a worst case scenario, this leads to the delayed delivery of large projects.
Strategy consulting is important because companies are adopting an architecture that they will have to live with for ten years or longer, but one that is constantly evolving. A PLM infrastructure will never be “finished”, says Wagner: “Companies need to look at things from a strategic viewpoint in order to decide which components should stay as they are and which can be modified in response to circumstances. At the same time they have to think carefully about what implications that has for everything else. That’s why I always see implementation as an integral part of our consulting services.”
PLM strategy and concepts should be designed with a ten-year horizon because it will be impossible to implement all the topics in the next two years. Mario Leber adds that management is responsible for monitoring implementation: “It’s necessary to adopt an agile response to any discrepancies identified between the planned and actual status at all times and the PLM strategy must also be updated accordingly. Otherwise, you’ll have to start all over again in three years’ time.”
Maturity analysis provides the basis for comparison
Even if it is the search for a new PLM system that gives rise to strategy consulting, the selection of an appropriate system ranks only second or third in the list of project priorities. The project team first needs to understand how the company is currently working, where exactly its problems lie and what processes it wants to improve with PLM. “We use our PLM capability map to perform a maturity analysis together with the customer with the aim of developing a common understanding of where they stand and what they want to achieve,” says Peter Wittkop.
“The capability-based maturity analysis is, as it were, the quintessence of all consulting projects,” adds Andreas Trautheim-Hofmann. It summarizes best practices in industry with regard to dealing with PLM-specific functions like change, configuration or project management across industries and makes it possible for customers to compare their capabilities with other companies. At the same time it provides the basis for creating a capability-based requirements specification that takes account of both current needs and future requirements. “As far as core PLM functions are concerned, comparing systems is easy,” says Wittkop. “This is why our benchmarks focus on new capabilities and the ability to integrate them. Integration capability is crucial for end-to-end digitalization.”
“This is why our benchmarks focus on new capabilities and the ability to integrate them. Integration capability is crucial for end-to-end digitalization.”Peter Wittkop, Lead PLM Expert, PROSTEP AG
Since it is often a tight contest between systems from a technical perspective, the PLM consultants also check how well they are suited to the way users work and the company’s philosophy. Trautheim Hofmann illustrates this using the manufacturer of valve actuators, who he provided with advice when it came to selecting a system, as an example. The company configures its variant-rich products in the ERP system and wants to continue doing so in the future. Therefore the aim was not to demonstrate that PLM systems perhaps provide better support for configuration management but rather how well they are able to handle configuration parameters from a different system. “We have to look beyond the PLM systems’ colorful user interfaces if we want to identify these differences, which will ultimately tip the scales.”
The potential offered by PLM is not fully exploited
One of the key findings from numerous consulting projects is that companies underestimate the potential offered by their existing PLM infrastructures and therefore fail to fully exploit it. It is not unusual for a company to have a powerful PLM system but nevertheless be unable to provide its processes with the best possible support because the system is not being used properly, says Mario Leber. He believes that the main reason for this is the fact that middle and upper management often fail to pursue implementation of the PLM strategy rigorously enough: “Once the project has been launched, the tasks are delegated to IT or the specialist departments. This results in local optima that no longer fit into the overall picture after two years at the most. There is a lack of sustained attention from management.”
The professional marketing machinery of system manufacturers and their implementation partners is certainly partly to blame for the situation. Their prime objective is to sell software and they come into contact with managers who want to believe that rolling out an IT system will provide a simple solution to their problems. A PLM project is therefore quickly brought to a close once all the users are working with the system. This means that the ongoing development of the processes and methods that are being used or the complete mapping of complex process chains is no longer a top priority in the real world of day-to-day business. Too little attention is often then paid to supporting and expanding the solutions, which in turn upsets users and over the years raises the question of whether the wrong PLM system was selected. “It is then usually too late to change tack,” says Lars Wagner. “There is a different momentum to rolling out a new system than changing an old one.”
A change of system can, but does not have to be, the ultimate outcome of PLM strategy consulting. “It’s not our job to persuade customers to replace their systems; instead we provide them with system-neutral advice,” says Leber. Sometimes a PLM solution simply needs to be used differently or integrated better. Leber illustrates this using the example of a manufacturer of vehicle exhaust systems who redesigned its existing PLM solution after the consultation because numerous adaptations had led to it becoming unwieldy. Thanks to the strategy consulting, the company was spared the cost of selecting, purchasing and implementing a new solution.
Systems require the right methodology
When evaluating PLM capabilities, the PLM consultants often find that the problem is not that a company lacks some fantastic IT tool but rather the way the company works. “Many companies have simply carried over into the world of PDM the methods they used back in the days of drawings without bearing in mind that PDM/PLM systems function differently. They continued making changes to the systems until the users were able to work with them in exactly the same ways as before,” says Andreas Trautheim-Hofmann. “This is one of the biggest mistakes that companies can make and a major reason why so many PLM projects have failed in the past. Even the best PLM system is useless if you don’t know how to use it and where its limitations lie.”
“…Even the best PLM system is useless if you don’t know how to use it and where its limitations lie.”Adreas Trautheim-Hoffman, PROSTEP AG
Trautheim-Hofmann therefore advocates paying more attention to methods and processes. “Many companies feel powerless and are calling for better IT systems instead of thinking about how they can solve their problems better. Before giving thought to tools, they should think about what they want to do with them, how they want to do it and what information they need to do it.” It is also important to ask why something is being done the way it is, because this helps break old habits. Modified designs are often still created using copy and paste because this is the way it has always been done and customer requirements are supposedly too different to allow product architectures to be modularized and systematic variant and configuration management to be established. Even an 80-percent configuration would be a big help to many companies.
“Customers tend to underestimate the need to work on a specialist concept in PLM projects,” adds Mario Leber. What he means by this is that they need to give sufficient thought to how they want to work with the new or existing PLM solution. Transferring current processes is not much help; but a considerable amount of effort is needed to persuade key users and users to adopt a new way of working Peter Wittkop confirms Leber’s assessment: “When processes are reworked, users often get lost in the details, which makes implementation very complicated. They have to adapt to changes and are afraid that they may have to cede responsibilities to other parties or systems . The roadmap therefore needs to be implemented systematically and requires patience and support on the part of management.
Creating trust based on technical expertise
PROSTEP’s PLM consultants not only support customers when defining their PLM strategy and selecting a system but also work with them to develop technical concepts for implementation and, if necessary, provide support during implementation. “We see ourselves in the role of coach, who offers expertise and interpersonal communication skills,” says Peter Wittkop. “Sometimes we also assume the role of product owner and discuss the steps involved in implementation with the vendors, even though we don’t have any decision-making or budgetary authority. But our customers entrust us with this task because they have complete faith in us.”
“We see ourselves in the role of coach, who offers expertise and interpersonal communication skills…”Peter Wittkop, PROSTEP AG
According to Lars Wagner, specialist know-how, expertise, experience and honesty are the most important qualities of a consultant. “I experience a great sense of achievement when customers I’ve advised keep coming to me with questions about PLM and digital information flows. But you have to earn the role of trusted advisor by providing reliable support when previously developed architectures and concepts are being implemented.”
PLM strategy consulting is exciting and involves a wide variety of tasks, but it is sometimes a difficult balancing act. “Our strength lies in the fact that we provide both technical expertise and methods-specific know-how,” says Andreas Trautheim-Hofmann. “To me, providing good advice means touching on sensitive issues and helping the customer identify the real problem.” Mario Leber adds, “Persuading a customer that they’ve overlooked certain points in their project concept and that the solution is perhaps different to the one that they imagined is, for me, the biggest challenge. At the same time it also gives me the greatest sense of satisfaction when everything works as planned and, once the project is finished, I can outline the next project for the customer.”
“Our strength lies in the fact that we provide both technical expertise and methods-specific know-how.”Andreas Trautheim-Hofmann, PROSTEP AG
Dr. Martin Strietzel studied mathematics in Cologne. He has been working on the simulation, design and development of complex products ever since he completed his doctoral thesis. Having previously worked at the German Aerospace Center (DLR) and on PLM projects at Ford, he has been working for PROSTEP for ten years. He is currently head of the PLM Strategy and Processes division, which is responsible for PLM strategy consulting. What attracts him is the challenge of persuading executive management of the strategic importance of PLM.
Peter Wittkop studied mechanical engineering at the Technical University of Darmstadt and has been working as a PLM consultant for 20 years, seven of them at PROSTEP. What he likes about his work is the fact that he is always dealing with new people and customer situations. His strengths are a capacity for analytical thinking, a knack for dealing with people and a great deal of patience.
Andreas Trautheim-Hofmann studied mechanical engineering and information technology in Dresden. He has been working at PROSTEP for almost 25 years and during this time has advised customers in all sectors of manufacturing industry. As a mechanical engineer who gives everything he’s got and a creative person, he likes looking for new solutions. His strengths are the fact that he takes a methodical approach to his work and his ability to think outside the box.
Dr.-Ing. Lars Wagner has been working at PROSTEP as a PLM consultant since 2012. Prior to this he advised shipyards and other companies while working on his doctorate in production engineering at the University of Hamburg. What he loves about his job is his contact with people and the opportunity to work with them on technical solutions. What sets him apart is not only his system-oriented way of thinking and his experience but also the pleasure he takes in mastering complex challenges.
Dr.-Ing. Mario Leber studied design engineering at RWTH University in Aachen and returned to PROSTEP after working at a number of different consultancies. He has been working as a consultant for 25 years and still enjoys applying his experience to new challenges. His power to persuade and capacity for strategic thinking are his sharpest weapons.