Product Life Cycle Management - Two Concepts
Product Life Cycle (PLC) and Product Lifecycle Management (PLM)
May 28, 2009
PLC involves marketing strategies to meet the four typical market conditions during the product stages of introduction, market growth, product maturity and product decline. PLM involves more efficient product development, production operations and product support by means of a centralized product data repository and improved communication among all stakeholders.
Product Life Cycle Stages: Introduction to Decline
The stages described below are typical market conditions at each stage and the typical strategies adopted to meet these conditions. Not all products exhibit the same characteristics.
Introduction Stage: An innovative new product is introduced into the market. Prospective customers are not yet aware of how the product can benefit them. The marketer has to educate them and build up demand. Because production volumes are low, cost of production is high and product is not yet profitable.
Growth Stage: Demand picks up as customers become aware of the product. Higher production volumes lead to lower costs and higher profits. Attracted by the high profits, competitors enter the industry. Selling prices begin to fall.
Maturity Stage: There are a large number of competitors and they are fighting for higher shares of the market. Selling prices fall further. Tactics like product differentiation and offering new features are adopted to compete.
Decline Stage: The market has not only become saturated but better products have also begun to appear. Sales volumes and selling prices fall. Sellers seek to achieve profits through greater production and distribution efficiencies.
Product Lifecycle Management: From Conception to Retirement
The emphasis of PLM is on the technical issues. All data that relates to the product is maintained in a centralized repository that all authorized persons can access. All data relating to brainstorming the product concept, design, engineering, bill of materials, materials content, workflow, processes, production, inspection, parts, change approvals and field service are thus accessible centrally
PLM Benefits
Improved and systematic communication among all departments, such as marketing, engineering, production and field service leads to their involvement at all stages from product development to support. The centralized data and improved communication lead to products designed to meet customer needs better, shorter product development times and improved product support lifecycles. Time-to-market has reportedly been reduced by as much as 75%.
Because of the centralized availability of all data about the product, buyers, production managers, quality control personnel and field support staff can get necessary information directly, instead of placing information requests to designers. Significant cost reductions can be achieved all around.
PLM documentation also makes regulatory compliance and compliance audits more effective and easier. For example, the materials content data can be reviewed by government inspectors by accessing the PLM data repository. Again, significant cost reductions result.
Product life cycle management can refer to two very distinct functions. PLC or product life cycle management refers to managing the different market conditions that a product faces during its lifetime. PLM or product lifecycle management refers to managing the product lifecycle of product design, engineering, production, maintenance and product support activities.
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