Practical PLM Newsletter - Issue 11
"Pursuing the Promise of Product Lifecycle Management"
In this Issue
- Featured Article - Fueling the Business of Engineering for Auto Suppliers
- Talent Spotlight - Meet Adam Secousse
- Events - Aras Community Event (ACE) 2017
- Learning - Upcoming Webinar
Fueling the Business of Engineering for Automotive Suppliers
Leverage PLM to Reduce Risk and Improve Predictability
By Martin van der Roest
Part 1 of a 2 Part Series
Introduction – A Perfect Storm for Uncertainty
Automotive suppliers face a combination of market forces that have created a unique business environment – an environment where uncertainty and unmitigated risk are eroding profit margins. Why are other manufacturing models immune and what’s so different about automotive suppliers? High volume production combined with product complexity create a perfect storm for uncertainty and risk. This article deconstructs these risk factors and explores strategies and tools to calm the storm.
"...the nature of production can amplify the risk inherent in the complexity of the order."
Let’s take a closer look. There are external forces that can’t be controlled such as macro-economic pressures, regulations, cost pressures and intense competition. These forces are contrasted by internal factors that can be controlled. These include improving productivity, zero defect production and reducing risks. All the while, the daily battle cry is to achieve the quoted profit margins.
The term “Business of Engineering,” was coined by Aras’ CEO Peter Schroer, and is used to suggest that product lifecycle management (PLM) is no longer confined to the engineering realm. Rather, PLM is part of an enterprise-wide strategy and represents the fundamental ingredients to achieve the promises of a digital transformation.
Given the challenges that automotive suppliers face and the advancements of PLM and supporting technologies, there’s no better time for suppliers to consider the business of engineering offered via PLM.
This article is the first of a two-part series. Part 1 explores the key elements that obstruct productivity and erode profits. This includes data disparity, the lack of process repeatability and poor decision making visibility. In Part 2, the enabling role of PLM’s operational capabilities is examined and mapped into the various lifecycle activities as dictated by the industry’s overarching Advanced Product Quality Planning (APQP) process.
It all starts with the Quote
The quotation offered by an automotive supplier represents a significant collective effort of the organization. The pricing needs to be competitive, and the margins need to be achievable … and sustainable over the term of the program.
Said another way, the nature of production can amplify the risk inherent in the complexity of the order. For automotive suppliers, these risks represent potential leakages in profitability.
In the quadrant diagram below, these two variables are used to illustrate the space that many automotive suppliers play in.
Along the X-axis, the spectrum of unique customer requirements is represented. On the left side, the quote has no provisions to express unique customer requirements. On the right side, the quotation is primarily based on customer requirements.
On the vertical axis, the nature of production is shown. On the lower portion, production is for a single unit order. On the upper hand, the production volume is significant and can occur over an extended period … such as years.
Arcing from the top left quadrant to the lower right, are the various “build to n” manufacturing strategies. On one end of the spectrum, the order process for a build-to-stock (BTS) strategy is uneventful and binary. This strategy represents such consumer industry groups as packaged food products, electronics and appliances. The risks tend to be tied to seasonal trends, sales forecast and macro-economic considerations.
"...automotive suppliers produce quotations like an ETO business, but eventually enter production like a BTS manufacturer."
The arc continues with build-to-assemble (ATO), configure-to-order (CTO), build-to-order (BTO) and finally engineer-to-order (ETO). The quote for an ETO business will demand the resources of several disciplines and will typically require multiple quote submittals that can span months.
Many automotive suppliers (exempting tooling and manufacturing equipment suppliers) are a unique hybrid of strategies in that they produce quotations like an ETO business, but eventually enter production like a BTS manufacturer. Hence, the positioning of suppliers in the top right quadrant.
Automotive Supplier Lifecycle of Activities & Associated Data
Unlike most manufactures, automotive suppliers operate with the overarching framework of Advanced Product Quality Planning (APQP) procedures and techniques. The diagram below incorporates these procedures and highlights the primary lifecycle of activities…
Continue reading this article at the Practical PLM Blog.
We’re excited to announce a new member to vdR’s PLM Practice.
Adam Secousse has joined the PLM professional services team as a project manager and implementation specialist. He brings extensive experience in solution architecture, software development, and project management. Previously, Adam has worked in big data, biosciences, financial services and numerous customer facing roles.
His approach to professional services embodies vdR’s core value of “being part of the solution.” Adam excels at building relationships that drive results – results that are grounded in his deep understanding of the technical issues and architecture.
"It's not just about solving a problem, but how you solve it. Long-term operability and scalability are critical"
Adam has his bachelor's degree in physics from UCLA. On his free time, he enjoys contemporary dance and was previously a member of the Pillow Project, a contemporary dance company in Pittsburg, Pennsylvania.
Upcoming Conference - Aras Community Event (ACE) 2017
When: March 21st – 23rd, 2017
Where: Nashville, TN
If you are starting a new PLM initiative, replacing an old one, moving from PDM to PLM, or growing your existing Aras implementation, ACE 2017 is the place for you. The three day event includes 11 networking sessions, 25 educational and interactive breakout sessions, and dedicated demo sessions.
- Hear best practices from Aras users who have been there done that
- 3 Days
- 11 Networking Sessions
- 20+ Educational and Interactive Breakout Sessions
- See innovative new solutions that will transform your business
- Learn about the latest technological advancements in PLM
- Attend focused sessions on a wide range of both business & tech topics
Who Attends ACE?
Whether you’re a business executive at a large enterprise, a manager at a mid-sized company, or the IT pro at a start-up, you’ll get valuable information and the insight necessary to achieve success with Aras Innovator.
- The vdR Group - Drop in and say hello to us at Booth 18!
- Huntington Ingalls
- And many more!
Upcoming Webinar - Powering the Business of Engineering for Automotive Suppliers
Thursday, March 30, 2017 - 11:00am to 12:00pm EDT
Automotive suppliers are continually challenged to stay competitive, optimize efficiencies, and achieve profitability. Learn how leading automotive manufacturers and suppliers are using product lifecycle management (PLM) solutions to manage the business of engineering. We’ll explore how PLM capabilities can orchestrate the full spectrum of activities from the quoting process all the way to production while ensuring process repeatability, collaboration, and unified data access.
Primary Topics Include
- Extend PLM into quoting to boost predictability and customer satisfaction
- Take control of costs with a "living" pro-forma P&L
- Leverage APQP, PPAP and other predefined templates and associated processes linked to designs, tooling, manufacturing process, geo-locations, etc.
- Improve adherence to OEM and industry quality standards such as ISO/TS 16949:2002