Are you getting the most out of your investment in PLM and ERP?
Not many are able to reap the intended benefit. Why? The investment in PLM can only be justified if it is well integrated with ERP in order to get the benefit of automation between Engineering services resident in PLM and operations resident in ERP. In addition, this needs to be a two way street with data flowing both in and out of PLM and ERP systems. Typically, PLM has been the repository of Engineering BOM, drawings, specifications and Approved Manufacturer’s list (AML) and ERP been the repository for Manufacturing BOM and costs. (On a side note though, this is also changing with PLM becoming master for Manufacturing BOM and costs too). New products or form-fit-function changes to products are initiated in PLM as an Engineering Change Request(ECR), gets approved electronically by one or more people, an engineering BOM is created and then it flows to the ERP system as an Engineering Change Order (ECO) with the relevant manufacturing BOM. This is the traditional integration, but which is only half the battle won. What winning organizations also do is integration from ERP to PLM for details such as cost/sourcing data and procurement history. This enables design engineers to have better design decisions in light of this additional data.
A customer that I worked with recently, integrated eMatrix with Oracle ebusiness suite and was able to derive many of the beenefits of PLM-ERP integration. The customer who operates in a highly customized, engineer-to-order (ETO) product scenario was able to streamline the product development capability with the implementation of PLM. PLM became the master for the Engineering BOM and depending on the factory where the product needed to be introduced/changed, the manufacturing BOM was pushed into Oracle via an ECO. Item creation in Oracle was automated by applying templates based on attributes of the item in PLM. ECO was also created automatically. Thereafter, to complete the detailing of the item within Oracle, a workflow driven process was used to pass the ECO from one functional area to another. E.g. for a make item, this could be from Manufacturing Engineering department to Planning department to Costing department. For a buy item this could be from Purchasing to Planning to Costing. Once all the functional areas had defined their relevant attributes, engineering change control would implement the ECO. Using the combination of the PLM process and workflow process within Oracle, the client was able to significantly reduce the cycle time of an ECO implementation – a must-have for an organization in an ETO environment.
