PLM: the Big Boys Push Their Way In

 
 
By eweek  |  Posted 2001-07-23 Email Print this article Print
 
 
 
 
 
 
 

On the prowl for fresh revenue opportunities, enterprise application vendors are pushing their way into the burgeoning collaborative product development space.

On the prowl for fresh revenue opportunities, enterprise application vendors are pushing their way into the burgeoning collaborative product development space.

Over the last year, Oracle Corp., SAP AG and i2 Technologies Inc. have added Web-based product development modules to their enterprise suites, touting integration between those tools and core back-end financial and manufacturing processes as well as front-facing customer relationship management and supply chain applications as features that give their products a leg up over more Web-based design collaboration packages that come from more traditional CAD or product-data-management-oriented vendors. Each is also trying to leverage its respective strengths: i2 plays up sourcing capabilities as part of the development process, while Oracle and SAP promote a central repository for sharing design information over a products life cycle. SAP is also emphasizing its vertical domain expertise in industries such as pharmaceuticals and consumer packaged goods as another key differentiator.

Despite their aggressive efforts, however, analysts say the offerings are still immature. They say the products are light on functionality for accepting files from a wide range of CAD and engineering systems. They also lack some of the critical decision-support tools such as portfolio management capabilities for determining, based on manufacturing and other constraints, which development projects should be pursued and which should be terminated.

"Their offerings are still pretty much focused on collaboration within the four walls of a company," said Navi Radjou, an analyst for Forrester Research Inc., in Cambridge, Mass. "Once you move outside of those walls, the old CAD tools can offer more connectivity options."

Radjou and others said they believe the enterprise Big 3 are actively addressing these weak spots and soon will have sound collaborative product design stories. Plus, Radjou said, the large vendors will have an advantage selling PLM (product lifecycle management) to big enterprises.

The enterprise software vendors are busy shoring up whatever PLM shortcomings they may have. Dallas-based i2 made two key acquisitions to get the expertise and technology required for its collaborative design offering, called the Supplier Relationship Management suite. And Oracle, which built its own technology, is adamant that product design functionality is the next logical extension of an ERP (enterprise resource planning) suite. "If you look at the evolution of ERP, its to drive value by having more people on a common repository and integrated system," said Kurt Robson, Oracles vice president of applications development, in Redwood Shores, Calif. "The next big frontier is the engineering department." Oracles Product Development Exchange, released initially in December last year, with the 6.2 upgrade launched last month, is in active use internally at Oracle as well as at a couple of customer sites.

SAP is fully committed to PLM as one of the key pillars of its corporate strategy. Approximately 70 customers have signed deals for the companys PLM suite in the last six months, officials said, and they expect the upturn in corporate interest to continue.

"The biggest ROI [return on investment] potential is close collaboration between engineering and manufacturing, not just in-house, but across the supply chain with development partners, suppliers and customers," said Stephan Schindewolf, director of business development for mySAP PLM, in Walldorf, Germany.

 
 
 
 
 
 
 
 
 
 
 

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