PLM Reaches For Smaller Firms

Dec. 21, 2004
Early adopters in automaking and aerospace consider product lifecycle management (PLM) a key competitive strategy. Now IBM also tailors the tool for smaller firms.
Question: What PLM benefits accrue to small and midsize manufacturers? Answer: Regardless of company size, PLM improves product development of complex designs and enhances the use of product-related information. In tailoring a PLM solution for smaller firms, IBM is trying to remove the cost barrier to better business decisions and greater customer value. In addition, smaller firms can use PLM to open new markets, says Scott Hopkins, general manager, product lifecycle management, IBM Corp., White Plains, New York. "If you're a small player, like a regional aerospace parts manufacturer, PLM allows you to compete for being a design partner with some of the larger partners." He says being able to collaborate with PLM can even provide the winning edge over larger competitors that haven't committed to PLM. IBM's customer data shows PLM's potential to improve cycle time by 35% to 40%, increase productivity by 20% to 30%, reduce material costs by 10% to 25%, pare engineering changes by 15% to 20% and cut overhead costs 4% to 10%. "PLM enables collaboration across organizational and geographic boundaries, thus improving supply-chain communication, business process efficiency and innovation capability," adds Hopkins. The PLM approach integrates the productivity gains and cost advantages made with CAD, PDM, ERP, SCM and CRM. To reach smaller PLM users, IBM has tailored its first three PLM Express offerings with a focus on function, ease-of-use, management and price. The target: manufacturers with an employee count between 100 and 1,000 that often have fewer IT skills and tighter budgets than larger enterprises. IBM's strategy is to meet the product development needs of specific manufacturing segments ranging from industrial machinery to consumer goods. In St. Louis, Jomico, a family-operated precision sheet metal job shop, is such a candidate. Mike Saputo, president, notes that "with this new PLM Express offering, everything is bundled to eliminate the high costs that can be detrimental to a small company like us. Now PLM is a tangible goal instead of a long-term vision." Three software packages are offered that range in price from $12,000 to $18,000 per license. With some IBM hardware and services included, the price could range from $30,000 to $50,000. The packages also include options for systems management, enhanced user support, application training and flexible low-rate financing options.

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