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News Release from: Datamonitor | Subject: Product lifecycle report
Edited by the Manufacturingtalk Editorial
Team on 27 April 2007
Streamlining PLM recognised as priority
Time taken to develop a product and bring it to market has become a key metric for progressive manufacturers
Streamlining product lifecycle processes is now a major priority for manufacturers looking to improve their market share According to the latest report by independent market analyst Datamonitor (DTM.L), manufacturing companies are looking to enhance both internal and external collaboration, manage product data better and streamline workflows, as time to market becomes ever more important
This article was originally published on Manufacturingtalk on 18 May 2007 at 8.00am (UK)
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Whilst by no means a new phenomenon, the report "Supporting product development with cutting edge IT" says this indicates it is now taking a higher priority.
In turn, these strategies are leading to additional investment in technology such as product lifecycle management (PLM), creating one of the fastest growing enterprise application segments.
"As competition increases within various manufacturing industries, the time taken to develop a product and bring it to market has become a key metric for progressive manufacturers".
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"minimising this time, while maintaining quality and fostering innovation is the latest challenge in today's manufacturing industry", says Adam Jura, Manufacturing Technology Analyst and author of the study.
"In 2007, we can expect a lot of product-driven investment in IT - this is making an interesting balance act for manufacturing businesses".
PLM is the process of managing the entire lifecycle of a product from its conception, through design and manufacture, to service and disposal.
Product Lifecycle Management software tools are used, primarily by industrial manufacturing companies to document and support the complete life cycle of their products and to devise and manage ancillary services, such as product maintenance.
Datamonitor estimates that by 2012, the worldwide market for PLM software (excluding maintenance) will reach $4.1bn in the manufacturing industry.
This represents strong growth on 2006 revenues of $1.9bn.
Growth will be driven primarily by large enterprises however the mid-market sector is beginning to demonstrate stronger growth in uptake.
Datamonitor's PLM software forecast model also assesses the investment in PLM within sixteen individual manufacturing industries.
Currently, the automotive, high-tech and electronic, and aerospace and defence markets are leading the way.
"Many manufacturers will turn to PLM technology to help alleviate their product-oriented dilemmas as the range of functionality and supported workflows and processes increases".
"Integration with other key enterprise applications such as enterprise resource planning (ERP) will be an essential component of PLM technology moving forward".
"Linking with supplier relationship management (SRM) and manufacturing execution systems (MES) applications is also growing in popularity," says Jura.
According to Datamonitor, vendors such as Dassault Systemes, UGS (now a part of Siemens Automation and Drives), PTC, Agile and SAP all stand to gain from a rapidly growing market.
Industry expertise and regional distribution are still key elements of investment decisions within manufacturing companies, as is the use of xCAD systems which a PLM investment will seek to manage.
Datamonitor believes that services vendors such as IBM and HP are also well placed to drive revenues in the PLM market as manufacturers look for a variety of services to assist in business process management and cross-border implementation.
2007 looks set to be a blockbuster year for industry observers with consolidation already underway.
Recent MandA activity has seen MatrixOne fall into the hands of Dassault Systemes (March 2006) and UGS acquired by Siemens Automation and Drives (Jan 2007).
Datamonitor predicts that 2007 is likely to see more of the same activity as the larger enterprise applications vendors such as Oracle, Infor and Lawson look to solidify their own PLM solutions, and established players divert more attention to the mid-market.
Jura concludes: "While product development has always been the mainstay of manufacturing companies, there's a real transformation occurring in the market that's seeing a lot more importance given to the area".
"What it all adds up to is that manufacturing companies are poised to both cut product development-related costs and introduce more innovative, successful products".
"Functionality, core integration capabilities, process and workflow support, and thought-leadership will determine which of the myriad of vendors will be the most successful in helping manufacturers reach their product lifecycle goals".
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