PLM Implementations - Why To Simplify First?

The original article was published on my Beyond PLM blog

I'm a big fan of simplicity. What made me believe in simplicity? I think it came with the experience. I've seen continues the success of products and technologies after applying simplification principles. A long time ago, I was discussing the PLM project with one manufacturing company. They have been running a very complex change process around custom configurations sales process. I still cannot say the name of the company but can share some experience. The idea of introducing automation to make it more efficient was the goal. However, the struggle was to integrate all touchpoints of the process. After several weeks of planning, the conclusion was that the current process cannot be automated - too many potential failures. Multiple existing financial and manufacturing systems were about to integrate with engineering databases. The conclusion was to change the process and optimize the way data is managed first. The joke around the table was that we tried to automate the process and to bring computers into a messy reality of existing human, paper and manual functions. And it was about to become a computerized mess. I was happy to see how the company decided to postpone the project and simplified the process first.

My attention was caught by BCG article Simplify First—Then Digitize. Take some time and read the article. The story is from a financial business, but in my view, it is can be applied to many manufacturing companies I know that struggle to plan their PLM digital transformation projects.

Here is an interesting passage about where the complication is coming from.

In BCG’s view, complicatedness arises from what a company does internally. It contrasts with complexity, which stems from external developments in the business environment that an organization can’t control. We define complicatedness as the increase in the number of organizational structures, processes, procedures, decision rights, metrics, scorecards, and committees that companies impose to manage escalating complexity in their external business environment. By taking such steps, companies think they are being proactive and meeting external complexity head-on, but they are exacerbating their complicatedness. The resulting changes slow reaction time and erode productivity. For instance, if a company seeks to tackle the problem of declining product quality by adding a dedicated organization unit to monitor production, it may introduce yet more rules, governance mechanisms, and meetings. In other words, complicatedness takes root in the context of the organization.

So, what to do before you decide to bring PLM tools and technologies to help you. It doesn't matter you're using cloud tools or on premise. The fundamental principles are the same. So, where the complexity can be found in every manufacturing organization.

1- Organization of data.

The data is usually messy in the organization. Historically, it can be located in multiple places -databases, multiple enterprise systems, tons of Excels. While data lives in all these places, an attempt to organize it in a more efficient process can end up with the messy results. Identification of parts, multiple part numbers, dependencies. You better clean this up. While doing so, think also how to get rid (or isolate) historical static data you need only for reporting.

2- Change control

Once data is organized, you can start the plan for the change process. You need to define what can be changed and what is needed in an organization to make this change. Design, procurement, change process, etc. All these activities need to be planned. The goal is to create a process that will be fault-tolerant with minimum dependencies. Remember -complex processes will fail. A simple process has a chance to live.

3- Reporting structure

Data needs to be available to everyone. The reason why everyone in the organization is creating his own Excel is that they don't trust systems and afraid to be dependent on them for their individual jobs. So, Excel wins. To plan a new approach that will make data available to everyone is the way to bring new technologies.

What is my conclusion? By following the simplification first rule, manufacturing companies can achieve better results in digital transformation and PLM project implementations. It will eliminate legacy tools and complex integration requirements. It will allow to streamline communication processes and create better alignment of data in an organization. The main challenge of this process is the change, which is very hard for every company. But remember - a simple process usually works and a complex process usually fails. Just my thoughts…

Best, Oleg

Disclaimer: I’m co-founder and CEO of OpenBOM developing cloud-based bill of materials and inventory management tool for manufacturing companies, hardware startups, and supply chain. My opinion can be unintentionally biased.

Picture credit ccPixs.com.