Driving PLM Excellence: The Transformative Power of OCM
Visualize the birth of a new product – from a simple concept sketch on the drawing board to the fully realized form rolling off the production line. Each stage of this process requires bringing together engineers, distilling their ideas through countless iterations, validating the prototype before tuning the manufacturing execution system (MES) to handle fabrication and assembly. It doesn’t stop here. The product’s movement must be tracked, both at the production level and beyond with the goal of sustaining it till its eventual retirement. Broadly expressed, this is what product lifecycle management (PLM) entails. Although PLM might seem like a compartmentalized, linear process, the ground realities are quite different. Business units and stakeholders cannot optimally perform their tasks in isolation. Separate sequential production activities do not necessarily require one activity to stop before starting the next. Designs often need to be modified to accommodate manufacturing constraints and conflicting requirements. Moreover, PLM methodologies will vary depending on whether a product is configured to order, engineered to order, or assembled to order. Enterprises usually treat these programs as IT projects, focusing more on implementing virtual tools and software suites, which integrate applications (CAD, CAM), methods (DFMA, DFSS), and product data. With this shortsighted IT-based approach, companies fail to consider the most critical aspect—the end user. The best-in-class players are not just those that are 3.2 times more likely to clearly align their PLM vision to business strategies, but also involve the customer right from the product’s inception. Considered a best practice, it is rather surprising that most organizations lose sight of their customers. Ideally, it is not just the lifecycle of a product that should begin and end with the customer, but also the aftermarket and sustenance services that follow right after. With the global PLM market poised to reach $75.87 billion by 2022, it is time firms realize that PLM is more than a sum of its technological components.
Driving Change: A Top-Down Approach
Since most present operational models are built around silos, new product development (NPD) processes tend to be fragmented and do not follow any commonly agreed-upon standards. Subject matter experts (SMEs) are not brought into the conversation right from the conceptualization stage. Thus, programs to restructure deeply entrenched processes are likely to be met with resistance and the lack of executive sponsorship. Modern consumer-centric enterprises require technically detailed, complex PLM solutions. Without factoring in the opinions of SMEs and the sentiments of end users, the established benefits and the concept underlying the formally crystalized solution maybe rejected by stakeholders owing to the lack of internal process knowledge. The ferocity of this resistance increases when new initiatives conflict with existing projects, the ownership of redundant or obsolete systems is questioned, and functional authority is threatened by cross-functional processes. To counter this and establish the value of embracing change, enterprises must define business objectives, identify areas of improvement, establish KPIs, and benchmark process maturity to discover and bridge gaps. Here is where a structured approach towards organizational change management (OCM) starts making sense. It should be effected by rolling out PLM solutions through a benefit realization framework. Once a solution has been developed, the framework demands unwavering focus on training every operator on the manufacturing side of the value chain, gradually scaling up skills to align with redefined processes and eventually, systems. This will require reevaluating roles and responsibilities of employees, creating mitigation plans if required, and synergizing cross-disciplinary teams to support short, agile product lifecycles and reduce time-to-market—all the while involving SMEs at every critical juncture. The benefit realization framework should be based on a goal-oriented OCM model, which drives individual stakeholders and the business as a whole to embrace change. It also needs to be implemented keeping in mind that both people and processes should incorporate directive changes and mature simultaneously. In this regard, a five stream OCM approach ought to primarily focus on organizational alignment and the development of an enterprise readiness roadmap, which defines sponsorship requirements, depth and breadth of employee engagement, a plan for building competency to handle technologies and responsibilities, and communication management. In turn, this will need change managers to create PLM process change awareness through workshops and seminars. It will be important to implement a rigorous, structured technical training strategy to equip employees with the right set of skills for the entire transition process. Finally, extending employee capabilities to cover aftermarket services and the sustenance of a product will enable enterprises to derive incremental ROI even after a sale is completed. Companies that have followed this approach have reduced product costs by 17%, decreased product development costs by 16%, and increased revenue by 19%.
Enhancing Collaboration: The Ultimate Goal of PLM
Research indicates that 50% to 75% of change efforts fail before reaching desired outcomes. In their bid to align people and processes with renewed business goals, manufacturers tend to ignore the inevitable incidences of engineering changes (ECs). These are particularly difficult to handle because their origins and effects are distributed across the phases of a product’s lifecycle. In fact, for most NPD processes, EC management has become a notable bottleneck. Apart from developing a formal plan for implementing ECs, organizations need to promote communication and collaboration among stakeholders to coordinate execution efforts across stages and business units. As PLM systems are designed to act as a repository of design and production information, enterprises are already in a position to freely exchange and access product and configuration information. Best practices and design modifications can be shared across sites, completely removing the scope for expensive iterations, reducing cost of development by 30% to 50% and increasing manufacturing feasibility.