The Indian manufacturing industry’s use of computers for design started with CAD/CAM and the use of software to control machine tools and related machinery. Then came PLM, which helped ensure that manufacturing is now looked at as a process-bound activity.
Today, the adoption rates of PLM solutions vary across industry verticals. The automotive segment has the highest adoption rate followed by heavy engineering and industrial machinery. These sectors have traditionally implemented state-of-the-art systems that give them an edge over the competition. Aerospace & Defense sector is the third highest in terms of its use of PLM solutions. PLM adoption in other sectors such as consumer packaged goods and pharmaceuticals happens to be relatively lower but it is expected to contribute to higher investments in the coming years, pushed by regulatory compliance.
Marwaha said, “PLM is evolving as an enterprise application and it is enabling CXOs to make smarter decisions and companies to design and make better products.”
According to the Industrial Automation & Process Controls Practice, Frost & Sullivan, the Product Lifecycle Management solutions market clocked revenues of $ 162 million in 2011, with an expected average growth rate of 15% over the next five years. The PLM market’s short term prospects will see stunted growth as companies are withholding big ticket investments while the medium to long term prospects appear positive for the PLM market in India.
A growing focus on product innovation; the ongoing drive to bring down the cost of production while ensuring compliance and product quality; the need to shrink a manufacturer’s carbon footprint are all driving the uptake of these solutions. These factors are of great importance to industries that are export-driven and are bound by regulations. Kirloskar Oil Engines, a company that supplies components to the global market, is one of the earlier adopters of implementing the quality module to execute orders.
Enhanced functionality
Rathinakumar Vaidyanathan, Director, SCM, PLM & Logistics Applications, Oracle Asia Pacific, pointed out that PLM was a process that went far beyond ERP. He said, “The Indian manufacturing industry has followed a unique adoption curve. The early 1980s marked a decade of adoption of financial solutions, and the number of ERP deployments saw a significant rise in the 1990s. In the current decade, ERP is a commodity, and enterprises are trying to bring in innovation and operational excellence through PLM software sets.”
Marwaha added that while ERP enhances efficiencies to boost the bottom line, PLM has a dual role and it has a positive impact on both of a manufacturer’s towline and its bottom line.
PLM is a platform that enables the integration of different phases of a product lifecycle from design to disposal phase. It integrates the existing modular solutions such as CRM and SCM as well as level 3 and 4 solutions such as ERP and Manufacturing Execution Systems.
A traditional PLM solution would include bits and pieces of CAD, Product Data Management (PDM), etc. Today, PLM offerings are becoming more sophisticated and they are starting to include modules such as engineering process management, requirement management, research and knowledge management, supply chain management and supplier-partner management
Atul Bhandari, Vice-President, Value Engineering, Industries & Customer Advocacy, SAP Indian Sub-continent, observed that collaboration between multiple stakeholders in the ecosystem, including customers, suppliers and internal product development organizations, which could be geographically dispersed, was also driving organizations to build efficient product data management and document management platforms.
Since organizations are conventionally structured in silos, PLM solutions are required not only to collaborate with the external world but internally as well.
Rajiv Bajaj, Head- Manufacturing, India & SAARC, Autodesk, corroborated, “Collaboration is critical to enable companies to design Virtual factories and products and also for production analysis. Players like TVS Motors are using factory design suites with a high level of collaborative functionality.
Bhandari noted that 3D Visualization was also playing a critical role in this information exchange between stakeholders in the ecosystem. “We are increasingly seeing organizations adopting visual information in order to drive systems such as part catalogs, visual maintenance strategies, visual manufacturing integrated in MES systems and visual sales and marketing, in the creation of customer collateral,” he noted.
“We are increasingly seeing companies express the need for a Visual Enterprise strategy, driving visualization across critical business processes that encompass manufacturing, maintenance, and sales and marketing, with design information from the product development organizations,” he said.
The lifecycle of products is shortening and manufacturers need to be quick to react to customer feedback. Chennai-based tractor manufacturer, Tafe does the entire design and manufacturing of its products including managing all of the information and collaboration for product designs through its PLM suite. Using the solution, it learnt that tractors were being used for purposes other than ploughing fields and tweaked the design accordingly in order to meet the needs of its buyers. About 65% of its revenues are reported to be coming from the new products that it has introduced as a result of this process.
Not just for large players
PLM solutions are generally considered to be a solution for large scale manufacturers due to the cost and integration benefits that they bring to such companies. The perception is that large manufacturers are able to extract the full value from a PLM solution by using it for complete data management, centralized control and the integration of different phases in the product lifecycle.
SMB manufacturers, on the other hand, feel that their existing systems fit the bill. This view is shared by tier 2 and 3 segments across industry sectors. These organizations typically employ standalone design and prototyping systems and use a PDM for their data management requirements. Many companies also look for outsourcing part of their product development process to external vendors in order to reduce costs and increase quality and efficiency.
These mid-market players are looking for modular and scalable PLM solutions, which will allow them to invest in tranches over a prolong period of time.
The concept that PLM is only for the big boys is being rendered obsolete.
Building intelligence
Since the PLM layer manages product data, there is a huge data repository that is created for the entire lifecycle of a product—from planning to manufacturing—and this data has to be analyzed and processed.
Ajay Verma, Vice President – Asia Pacific South, Dassault Systèmes, said that Indian manufacturing is at an inflexion point where traditional forms of vanilla PLM would be a thing of the past. PLM solutions should be able to lead companies to effective decision-making. Taking PLM to the next level, manufacturers are trying to integrate the systems with their CRM solutions and other channels like social media. They are also running BI and analytical tools in order to track the data and customer feedback that’s generated.
“The right queries need to be trapped from the business tools that come with a PLM system; these are not BI tools but some basic analytical tools that are incorporated into an ERP system,” commented Vemuri, Venkataramana, Director – Siemens Partnership, Atos India
Explaining that most PLM solutions came with some level of intelligence, Sanjay Mehta, CEO, MAIA Intelligence said that the key difference lay in the fact the PLM products captured data and did not retrieve it. The role of BI tools comes into play when data retrieval need to be done or when data from a third party has to be used.
Citing the example of a US-based company that has its electronic assembly unit in Maharashtra, Mehta said that this company used PLM solutions that were integrated with analytical tools for analyzing the bill of production. “The processes involving in end-to-end designing are married with the actual inventory of the materials and correlated with the data within the SAP ERP system for arriving at the final cost of the product.”
Earlier, PLM involved just the product manufacturing part. Now, it extends to packaging and development environments are being brought into PLM.
Arup Choudhary, GM – IT, Eveready Industries, was of the opinion that, for companies like Eveready, PLM had not been able to add much value at the production level and, therefore, they had not deployed these solutions. However, he did feel that PLM solutions could be of relevance for product packaging and for keeping track of aging stock.
Candidate for the Cloud
Analysts believed that, even though PLM as a Software as a Service (SaaS) offering was still at a nascent stage in the Indian market and had not achieved sufficient traction among users as compared to the traditional on premise implementation of PLM systems, in the future, this trend is expected to take hold as many vendors are going to or are already offering the software as a service to their clients.
The Cloud model works not only for Tier-1 but also for Tier-2 and 3 manufacturers. The success of PLM through the SaaS model will depend on the developments in this field with regard to data confidentiality, the availability of data and its integration with existing systems. In India, companies such as Arena and Aras offer PLM solutions on the Cloud.
Marwaha of Siemens PLM emphasized that they looked at PLM as a SaaS offering and Cloud-based deployments of PLM as distinct concepts. He said, “We are seeing some pickup in SaaS-based PLM deployments but they are still not in the mainstream. We see a push from customers to add support for deploying our PLM platform, Teamcentre, in the Cloud. We are in the process of creating hosting agreements with multiple SIs for them to host Teamcenter in the Cloud; both HP and CSC already have this ability.”
Siemens PLM has already announced support for IBM PureSystems and it intends to announce support for additional providers in the near future.
In any global deployment, careful planning must be done with respect to the location of the deployment and extra attention has to be given to how files are delivered and managed; and Cloud-based deployments are no different.
Krishna VM Gollapudi, Director & Head – Center of Excellence for Manufacturing, Capgemini India, observed that PLM as a SaaS offering fitted better into the SMB sector’s needs in terms of price point, scale and general affordability. Large organizations have the money and skills to host these systems on premise.
He said, “Even as SaaS and Cloud-based offerings get attention, concerns around data security, data loss (solutions are developed on specific platforms and data might not be transferable to other platforms ), continued connectivity and bandwidth availability will have to be addressed for these offerings to gain acceptance. Currently we do not see customers in India demanding Cloud-based offerings when it comes to PLM.”
PLM SaaS could be a good option for smaller players. Sethi said that processes that did not involve confidentiality and proprietary data were expected to migrate to the Cloud. Since most processes handle data related to product design, development, manufacturing or sales, much would depend on the developments in terms of the security and reliability of Cloud-based systems.
Building blocks
It will take Indian manufactures a little longer to plan their PLM deployments in the Cloud but, before that, they will have to tackle the challenges of traditional PLM deployments.
Most of the challenges faced while integrating PLM software solutions are similar to the ones faced in the case of other enterprise applications and these include mapping of the current processes with those enabled by the PLM system (reconfiguring the process for necessary hand offs, reviews and approvals), prioritization of processes to be digitized and getting legacy data loading into the new system. As the product data gets used and shared outside the company, protection of its IP becomes an important consideration to be addressed by the PLM system in use. Availability and accessibility as well as the version control of data becomes a challenge when multiple stakeholders are contributing to a given process, more so if they are using different tools and databases.
Perhaps more important is the need to define the scope of integration and the extent to which business demand is a key challenge as this needs to be eventually translated into a technology solution.
“It takes longer to integrate traditional ERP with PLM; in many cases it can take companies about to six years to complete the process as a majority of the players do not deploy the entire solution at a go. Rather, they add on modules as and when the need arises,” pointed out Verma of Dassault Systemes.
In order to reduce customization to a minimum and accelerate the implementation process, players have introduced templates that are specific to industry segments and come pre-configured with process templates, wizards and best practices.
For the future
The PLM footprint is extending to the segment strategy and it is now looking beyond just a product and its manufacture. The three key areas where the industry is likely to focus going forward are application lifecycle management, supply chain management and service lifecyle management.
SCM is critical as it records supplier information pertaining to compliance and quality. Component and material management are included in this module.
It is pertinent to note that a number of consumer products including washing machines, refrigerators and cars are being developed with a variety of embedded technologies. For example, a car could be fitted with an LCD screen, a refrigerator could have touchscreen controls; all of these need to be powered by software and concepts of mechantronics come into play; it is essential to ensure the compatibility of these applications with the concerned products.
Somani of PTC informed that several players like Whirlpool and IFB had already started talking about investing in solutions that would take care of the application lifecycle.
Service Lifecycle Management is becoming critical for products that have a longer life. Somani concluded that players like HP would not make much money from selling just printers; rather they make their profits on cartridges.