Product Lifecycle Management (PLM): the secret to a systematic approach

The product lifecycle describes the entire process that a product goes through – from market launch to market exit. Every new product that is brought onto the market completes this cycle at its own speed, depending on market conditions.

The lifecycle of a product can be divided into five phases that flow seamlessly into one another.

1. Market launch: The first phase of the product lifecycle begins with market entry. Awareness of the product should be increased as quickly as possible through advertising and PR. As sales increase, the product approaches the break-even point from which it starts to generate profit.
2. Growth: The break-even point marks the transition to the second phase. Awareness of the product and demand for it are growing all the time, as is profit.
3. Maturity: The maturity phase begins as soon as the product has established itself on the market and is sufficiently well known to its target group. Profit now reaches its peak and then falls again. The profitable maturity phase can be extended through additional advertising measures or product modifications.
4. Saturation: Increasing competition or changing customer requirements heralds the saturation phase which is characterised by falling demand and a decline in sales.
5. Degeneration: In the decline or degeneration phase, no further profit can be made. In order to avoid losses, the product is now withdrawn from the market.

This classification makes sense for marketing, as special measures can support the product in every phase in order to generate optimal sales.

A special management approach is required for managing the vast quantities of data and for  the smooth control of the processes that occur during a product's lifecycle: this is Product Lifecycle Management, usually abbreviated to PLM. The closely interlinked phases of the product's lifecycle are the core of Product Lifecycle Management. However, the focus of PLM is not only on the products themselves, but above all on the business processes that are required for product planning and development, for marketing, sales, servicing, maintenance and recycling. Bringing these processes together requires not only software but also an integrated approach.

Countless pieces of information, people, processes and software tools are involved in the product lifecycle itself and in its upstream and downstream operations. A PLM platform or a PLM system provides the necessary digital infrastructure to bring them together and thus to realise a product as efficiently as possible.

For product development to be successful, teams not only from different departments but also across all locations have to work together. Various types of software are also used (from CAD to CRM and ERP systems). A PLM system bundles the information from all areas of product development. As a result, all team members can access all the data relevant to them, regardless of time and place, and edit and update it in real time. With the introduction of a PLM platform, you create a digital ecosystem that ensures data consistency and thus enables faster, more cost-effective and more efficient development of individual products.

The PLM systems available on the market can differ considerably in terms of scope. The functionality of a PLM system extends, among other things, to software for:

• Project management
• Product data management
• Document management
• Configuration management
• Process management
• CAD data management
• Supply chain management
• Requirements management
• Variant management

A core component of a PLM system is also its system integration which ensures the exchange of data across various IT solutions. Interfaces between the PLM platform and the software solutions used ensure that the data is automatically synchronised.

The solution used should be the best possible match for the company's structures and goals. The following considerations can help you choose the right PLM system:

• Is the PLM solution scalable so that new company locations or additional users can be quickly integrated?
• Is it possible to add more modules to the PLM platform at a later date?
• Can the PLM system's software be flexibly adapted or is complex programming required for this?
• Does the solution remain updatable when industry or company-specific adaptations are made?
• Is the user interface intuitive?
• Is the PLM system characterised by a high level of reliability?
• Does the provider guarantee high-quality technical support?

The decision to have a PLM system has an impact on all business processes and should therefore not be taken lightly. Ultimately, your choice sets the course for the company's future viability and competitive capabilities.