Many years ago I worked for a national company that specialized in CAD and PDM and we were training a group of people on a computer aided manufacturing (CAM) system. Our trainer was a very knowledgeable expert in CAM tools and was from South America and also had ancestry from Germany. Coincidentally, that day the World Cup featured Argentina playing Germany. He was so interested in the game that he kept it on in our conference room and every time he heard the announcer scream GOAL!!! He would stop the class and rush into the conference room. If only companies were this passionate about goals for Product Lifecycle Management. This blog will analyze why we adopt PLM and what goals companies should consider setting when deploying PLM applications. To assist me in this effort to clarify the potential reasons for adopting PLM I have enlisted the expertise of three very knowledgeable PLM experts, Jos Voskuil from virtualdutchman.com, Oleg Shilovitsky from "Beyond PLM", and Andreas Lindenthal, owner of the PLM Technology Group and partner at Kalypso. All three were gracious enough to share their thoughts on goal setting and PLM. I will also review some general best practices when it comes to goals and discuss why it is important that we focus on the end results for PLM as opposed to becoming too fixated on the technology and feature sets.
One of the challenges consultants and companies have with implementing PLM is taking the time to fully understand the business drivers behind the PLM decision and to align the implementation to address these drivers. Jos Voskuil is a former Director of Solutions at Dassault Systemes and currently is an independent consultant that has deployed numerous PLM systems. When discussing goal setting for PLM he confirmed my experience which is that it is rarely done. To paraphrase from Jos, few companies are organized enough to be able to establish a "as is" baseline which is necessary for measurable goals. He was able to analyze certain deployments after the fact to establish some basis for ROI which he describes in this article. In general his feeling is that most companies adopt PLM to address a specific pain or issue much like one would adopt an IT solution like virtualization or some type of office or accounting solution. He also indicated that many companies have engineering types who enthusiastically believe PLM will improve their process but struggle to justify or quantify the benefit of the tools. I have observed similar phenomenon with my clients and feel it is important to provide guidance in this area for two reasons. First, is that in order to invest in new technology their needs to be some tangible measurable value. Second, is that by identifying a reason for PLM it allows you to architect the implementation to achieve the objective. PLM is so broad that having a specific objective would be very helpful in successfully implementing the tool.
Kalypso has a reputation for being a pragmatic business oriented organization. Andreas' thoughts on goal setting are consistent with this reputation. He recommends setting business goals instead of PLM goals. In order to do this one must understand the overall vision of the company which is very good advice. He gives an example that a company might have an overall goal of wanting to be the most innovative in their industry so to meet this objective they set a goal of generating at least 40% of their revenue from products introduced within the last three years. This means that they need to have a pipeline of 10 new products at any given time and that the product cycle time needs to be less than 12 months. With these goals in mind PLM can be deployed in a manner to support this initiative. Andreas provides examples for how this might occur. If the company currently struggles with 16 month cycle times to bring new products to market due to current manual and paper based processes and if the success rate of new product introduction is only 50% how will PLM enable the company to improve the success rate while shortening cycle times? The emphasis of the PLM implementation would be to create a stage-gate new product development and introduction process that would include project and portfolio management that would provide management with better information for deciding on which projects are actually developed and to automate current manual processes for better efficiency. Obviously this is a fairly broad and ambitious goal but I think it is a good example of one type of goal setting that can be effective in keeping PLM on track.
Oleg Shilovitsky is a prolific blogger on PLM and has a background similar to Jos'. He was the Chief Technical Officer at Dassault for Smart Team and currently is the CEO at Inforbix, a startup in the product development/manufacturing space. With Oleg I posed a series of questions about how companies should approach goal setting for PLM. Oleg suggests that when goal setting for PLM companies should focus on goals around increasing efficiency, streamlining process and cross departmental communication. He recommends setting short term goals with smaller steps and focusing on goals that yield measurable results. He also warns against projects that go longer than 1 year and setting data ownership goals instead of process improvements. He feels that a combination of long range vision and short term project planning yields the best results.
To further expound on best practices for goal setting I want to leverage a book I am currently reading titled Life Entrepreneurs, by Christopher Gergen and Gregg Vanourek. There are numerous books out there about goal setting but I thought this one did a fairly succinct job of describing effective goal setting. Specifically, they highlight three aspects for effective goal setting; purposeful and prioritized, clear and measurable, and challenging but achievable. When goals are aligned with vision or purpose they are naturally motivating. So it is critical that there is larger understanding of the purpose for PLM within an organization. Goals can lack clarity so it is important to choose goals that can be quantified otherwise you will never know if you are making progress or have achieved the goal. The last point the book makes is that it is better to set an ambitious goal and fail than to settle for goals that make smaller impacts. The book also has warnings about goals. Avoid setting too many goals or you will risk dilution. Generally 3-5 goals is a much more manageable scenario. Make sure that goals are broadcast out to the organization and that everyone is aware of them. It does no good if goals are conceived but not shared. The final warning is viewing goals as a one-time sprint. Goal setting should become a habit. Once certain goals are achieved it should just spur the organization onward to identify new objectives and continue to move forward.
Keep in mind that there is no real "magic formula" for setting a strategy for implementing PLM or setting goals for product development. These strategies are based on experience and common sense. The key is to spend the time up front and throughout making sure that the objectives for why you are adopting these applications are not obscured by the challenge of the technology itself. The key take-aways from Jos, Andreas, and Oleg are that goals are important and without them justification of PLM can be challenging. Aligning PLM with business process is an excellent way to alleviate this issue. Finally, combining long term vision with short term action will yield the best results when it comes to both setting and achieving goals for PLM. Following these approaches and faithfully monitoring your progress should create an enthusiasm similar to our manufacturing consultant's but hopefully when you achieve your goals it will be more meaningful and impactful. [clear-line]
[Edit: Repost from 2011]
