November 4, 2024 Laying the Groundwork for Successful CLM Projects

Configuration Lifecycle Management can help overcome the complexity of modern manufacturing – but only if you transition to CLM properly.

by Dr. Jan Göpfert, Partner, PwC Germany and Holger Senn, director and industry advisor, Configit

Configuration Lifecycle Management (CLM) can play an important role in helping manufacturers navigate increasing product complexity in terms of variations, customizations and more. On the flip side, complexity can also be a major thorn in the side of potential success with CLM if you don’t do the proper housekeeping before launching a project.

Complexity is a threat to growth and value. Fortunately, there are available approaches to help master this complexity throughout the product lifecycle and prepare your organization to successfully use CLM.

An increasingly complex landscape

Today, organizations are grappling with more complexity than ever, including:

Products: The sheer number and nature of components, the interdependencies among those components and their respective interactions.

Configurations: Customers today want more options, more choices and customizable (configurable) products.

Processes: When you have complex products and complex product portfolios at the beginning of the value chain, driven by your customers, that results in complex sourcing and procurement processes, which again result in complex manufacturing assembly processes.

While CLM can help companies manage their configurable products, if you start copying all the sins of the past into your new CLM system, you’re probably going to fail. Think of it this way: before you move to a new house, you’d better sort through all those boxes in the basement before calling the moving company, letting them pack everything and bringing all that junk into the new house. Similarly, you need to “clean up” before you move into a CLM solution in order to be efficient.

Moving to modularization and standardization

One of the key measures to eliminate complexity is modularization and standardization. A modular platform is a standardized set of reusable components that are combined, recombined and configured into individual products. You can customize them, but they must stem from a common base. This increases margins on your side and minimizes engineering efforts by reusing as much as possible but still delivering what the customer wants.

Consider this in practice: you have products and product lines, each individually engineer-crafted with separate bills of material and variance that you must manage, and not much interaction. It makes more sense to use a modular system. The common platform that you use is then reflected in the product lifecycle management (PLM) systems within the configuration system.

In this way, you simplify the full value chain. You’re faster to market because you configure instead of engineer; you have less variance to manage within your portfolio. Of course, you can use scale effects in procurement, which saves your cost. You have easier assembly and manufacturing processes, validation, product test quality – all are simplified, all the way down to spare parts handling.

So, to tackle the problem, you need to get everyone on board in the early phase of defining and reducing complexity within your product portfolio.

A blueprint for setting up your system

To start, you need a solid methodology to combine all the different views to align early on from the market view, the customer view, and all the way down to how it impacts your product. You need to bring people and disciplines together and come up with an aligned approach that reduces complexity. When you inject a new variant or think about doing so, how will it impact your product? How can you change your design to avoid complexity? How can you reduce the impact of this new requirement?

These aren’t easy questions to answer, given that they address multiple stakeholders within a company – and involve many different data sources and tools. There are tools that manage requirements, as well as tools that manage aspects like product configuration, the bill of materials, the cost and more. Typically, these are disparate and disconnected. To address these overarching questions and successfully manage complexity requires creating an end-to-end data model.

To accomplish this, you start with an architecture model, which at a high level combines the different views into one holistic picture. This is an end-to-end, 360-degree data model, combining the requirements and market demands all the way to the product design, variants, product configuration, the bill of materials and into the production line and bill of processes. This brings together your experts from the different departments – sales, product management, engineering, production, etc. – to efficiently discuss and optimize your product portfolio from multiple perspectives.

Setting up for success

Complexity can be a project killer – and it’s embedded into every aspect of manufacturing today. CLM can help significantly, but only if you provide it with the clean data it needs to function properly. Modularization and standardization are crucial for reducing complexity and simplifying the full value chain. Use the “blueprint” provided above to establish a system that will position you for reduced complexity and greater success.

About the authors
Dr. Jan Göpfert is a partner at PwC Germany and an expert in business transformation with a focus on complexity management. He founded the company ID-Consult in 1998, based on his doctorate degree on “Modular Product Development,” where he developed the METUS method and software solution for product and product platform conception. In 2022, Dr. Göpfert and his team joined PwC, bringing their expertise in innovative solutions to the firm.

Holger Senn, director and industry advisor at Configit, has worked on challenging tasks in variant and configuration management in the manufacturing industry for almost 30 years. Since 2016, he’s been with Configit, overseeing the company’s work in Germany, Switzerland and Austria. He’s also an active speaker and evangelist for Configit. He previously worked as a consultant and trainer at the Institute for Communication and Business Development in St. Gallen, Switzerland.

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