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Manufacturers are dramatically changing the way they design, engineer, manufacture, and service products because of multiple factors - the increase in complex, "smarter," connected products, unique, dynamic demand from customers, and highly competitive markets particularly in emerging economies.

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Our ongoing discussions show that manufacturers want to unify their ideas, product data, quality information, service processes, and customer information so they may:

  • Accelerate the response time to demand;
  • Reduce development cycles;
  • Improve quality and service management.

Due to changes in the process from design to service, engineering and R&D teams work needs to broaden in scope — both from a capability standpoint and how these teams collaborate with their broader network of value chain participants that helps bring products to market and service them.

IDC Manufacturing Insights 2015
Product & Service Innovation Survey Given this backdrop, in the spring of 2015, we fielded a survey to determine current product and service innovation methods, practices, and plans. Our research revealed that the disciplines of PLM (Product Lifecycle Management) and SLM (Service Lifecycle Management) are evolving to become strategic business initiatives for leading manufacturers, as market pressures and customer demands force companies to find better ways to bring quality products to market and deliver value-added services through them. Manufacturers are moving away from investing in standalone engineering and service workgroup tools, and toward more strategic initiatives like product innovation platforms and service transformation in the coming years.

Technology is a key enabler for these transformations. Manufacturers increasingly are considering 3rd Platform technologies like mobile, cloud, and analytics to complement how they design, engineer, manufacture, and service products. Manufacturers are extending product life-cycle management across the enterprise and beyond to form product innovation platforms: to customers, marketing, and suppliers, as well as to manufacturing, whether in-house or outsourced.

In fact, when asked what the “big vision” is for their PLM and SLM approach, the top answer overall was to be best in class for product innovation. Notably, brand-oriented manufacturers (e.g. apparel, consumer products, retail) and asset-oriented manufacturers (e.g. chemicals, metals, pulp & paper) are interested in extending the product innovation efforts beyond the traditional walls of engineering to incorporate partner and customer input, which is an important realization of true open product innovation. These value chain nuances are important to keep in mind as manufacturers consider how to adapt their existing PLM and SLM practices to reflect the changing market dynamics.

Quality Tops the Priorities
According to our research, product quality is the top PLM initiative by a wide margin (of course manufacturers also want to accelerate time to market and improve product introduction success, as well as gain a greater control of the product development process). Faster response to product quality issues and customer complaints is also the top SLM initiative, reflecting the desire to improve customer responsiveness as well as tie service data more tightly with PLM. Almost 60 percent of respondents answered that quality is a top business driver of their PLM and SLM efforts.

Furthermore, quality management is the top overall innovation process that manufacturers want to deploy in the cloud. Why is quality moving to the cloud? IDC Manufacturing Insights thinks this is primarily due to the fact that to achieve exceptional product quality, you need openness and speed in your quality processes. If you have a quality issue with your product, you want it surfaced and acted upon as quickly as possible whether via a customer, partner, engineering manager, or service technician. Deploying a quality management system in the cloud increases the ability of an organization to sense and quickly address a product issue to maintain high quality and customer satisfaction. Additionally, with the available processing power through a Hadoop framework in a cloud deployment, manufacturers are able to scale the management and analytics of massive amounts of data created by connected products, whether that information is quality, performance, usage, or service related. Simply put: quality is so critically important that manufacturers are choosing the deployment environment that expedites action.

Analytics & Mobile Technologies Drive Product & Service Innovation
Quite interesting, according to our recent 2015 Product & Service Innovation survey, is that manufacturers are interested in applying analytics to the later stages of the product life cycle and less to up-front ideation, supply chain risk analysis, and supplier performance review. The need for analytics, according to our survey data, is really on the handoff after design and engineering: product performance, customer support, manufacturing execution, and most importantly, quality, are the top areas manufacturers will apply analytics to for PLM and SLM improvement.

Manufacturers today need a wider view of an extended value chain and development process, changing customer demand, and multi-tiered supply chains, as well as associated quality and service information. As manufacturers connect PLM with other enterprise systems to establish a product innovation platform, analytics becomes necessary to make proactive decisions on all relevant data about customers, suppliers, partners, and manufacturing that impact the new product development and introduction process. In addition, connected products will generate a large stream of data that can be analyzed and applied to improve the quality of products and design new ones.

Mobility has really come of age in the PLM and SLM worlds as our research indicates that it is no longer only used for process sign off or basic collaboration and communication among internal team members. One of the most interesting findings on mobility is that product design/formulation is the top area that mobile devices support (70 percent of respondents). Currently, design and formulation outside the company is not yet taking place via mobile devices, but when asked for plans in the next 12–24 months, half of the respondents say they will extend design and formulation to teams outside the company. For services, the application of mobility spans inside and outside the organization, with customer support (75 percent) and service requests (65 percent) the top 2 areas of focus. When asked for plans in this area over the next 12–24 months, the focus shifts to tracking quality issues, followed by field service enablement, including electronic service work instructions. Manufacturers are well on the path toward integrating mobile devices into the fabric of after-sales services to enhance customer experience and deliver better service.

We think the maturity of mobility in product and service innovation can be looked at in three levels: Our research shows that we are rapidly entering phase 3 of this maturation, which is likely to accelerate usage and integration of PLM and SLM across the value chain. When you think of the macrotrends outlined earlier — complex products, dynamic demand, competitive pressure — this development is to be expected, as manufacturers look for ways to respond quickly and efficiently; mobility is looked at as that high-speed bridge between product, manufacturing, service, customer, and back.

The Rapidly Maturing Face of Innovation
These are truly exciting times for manufacturers, users, and IT suppliers of product and service innovation technologies. The complexity is massive on so many fronts: product, value chain, manufacturing, and service. Technologies exist today to address this complexity but the challenge (and opportunity for IT suppliers and service providers) is integrating them together as appropriate, providing an easy way for the user to manage, analyze, consume, and apply product and service information for innovation and competitive advantage.

Jeff Hojlo – Program Director
As Program Director, Product Innovation, Jeff Hojlo leads IDC Manufacturing Insights research and analysis of the PLM market, including topics such as the development of an innovation platform and the intersection of product design, development, and digital manufacturing. Mr. Hojlo is also responsible for research on business and IT issues related to the engineering oriented value chain (EOVC), which includes automotive, aerospace & defense, industrial machinery, and heavy equipment manufacturers, as well as the technology oriented value chain (TOVC), which includes manufacturers in the electronics and semiconductor markets.

Volume:
18
Issue:
6
Year:
2015


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