PDM—an extension of ERP

Reliable and timely information brought in by ERP systems is essential for today’s decision makers. But going beyond, an organisation needs to complete the feedback cycle in all departments so that innovations and efficiencies can be built into future work processes. Varghese K Daniel advocates the use of the enterprise product information model to achieve this

ERP is a necessary tool for any organisation that wishes to align its business systems around its strategies. However, while ERP can definitely position an organisation to take the first steps towards this desired state, there are other initiatives, like supply chain management, customer relations management, product development management or knowledge management that give an organisation a competitive edge.

Collaborative engineering

The new emerging paradigm among manufacturing industries is Collaborative Engineering (CE). This, in turn, has led to the emergence of a category of software known as product data management (PDM) or product lifecycle management (PLM). It has a profound impact on many engineering disciplines, especially in companies involved in verticals like:

In today’s competitive business environment, the engineering industry faces many challenges. Reducing time-to-market and engineering and production cost is one aspect. Improving product quality and maximising reusability of existing parts is crucial. Providing accessibility to all related information at the design desk and ensuring processes defined by quality systems such as ISO or QS are adhered to by the company while developing its product are other imperatives.

The major portion of the quality and cost of manufacring in these industries is determined at the product design and engineering stage.

The latest trends indicate a shorter product life cycle. Capturing the business right from the prototype stage opens up more avenues for revenues and strengthens the economic viability of the organisation. All these demands drive the need for a more systemised and structured use of available in-house strengths, talents and technological know-how.

Another challenge faced by companies is to improve synergy between various departments involved in sourcing, designing, planning, manufacturing and marketing. A common platform to share and exploit a rich information base, including drawings and documents, is required.

Engineering design and project management are the key areas that foster change. It is imperative that management of design and projects are given priority. Both time and cost need to be managed. Information, the key to the success of any engineering industry, and access to the right information at the right time to the right person, is of utmost importance.

Enterprise Product Information Management

EPIM is the missing link in ERP. It plugs one critical part of product engineering and design into the rest of the organisation. This activity is usually bypassed by most ERP packages. Major companies like Bharat Heavy Electricals (BHEL), Larsen & Toubro, MICO Bosch, Widia, Bharat Earth Movers (BEML) etc., have expanded the reach of their ERP systems to include the product development process. Thus, data now flows backwards through the ERP-empowered channels of these companies into their design studios and labs as well as outwards from tiers into the supply chain management and manufacturing systems. The additional module that makes this possible is PDM.

What does PDM do?

In one company, PDM translates the design specifications of a machine part directly into the specs of the raw materials that will be needed, churning out the appropriate bill of mterial (BOM). While in another company, it ensures that information about modification to the product made in response to a change in customer requirements is immediately captured on the shop floor so that the assembly line can be adjusted to the new design. In yet another company, PDM allows alternative product specs to be shared with the customer by marketing it before the final design is frozen.

In short, PDM links product development to every other part of the organisation. For example, castings used in the automotive industry are complicated and mistakes discovered during manufacturing can be expensive. Integration of design information now means that corrective measures can be taken at that stage itself, affecting the way the entire company functions.

For example, a typical excavator contains about 3000 odd parts. It also has unique design specifications, with the related drawings, documentation, product history and records. Some components are used across the product-range while others are specific to a product. Approximately 30 major engineering changes are done to these products every month. They are based on quality assurance feedback, customer feedback, and new requirements. This adds up to considerable complexity at the post-design stage since every change cascades into modifications in components, raw materials, schedules—all of it culminating in not just duplication and wasted effort, but also delays in time-to-market. With PDM this timeframe is reduced dramatically. Also, companies can economise on expensive manpower savings that can
be translated into the profits of the company.

PDM, an extension of ERP

Just like ERP, PDM has the power to deliver any piece of information to any desktop, regardless of where it physically resides or which software application was used to create it. However, unlike ERP, PDM goes back to the roots to include the blueprint. It will reduce the time-to-market for new products since post-design processes can be conducted simultaneously with the design and turn concurrent engineering into reality. PDM will provide an audit trail for the workflow, which is crucial for total quality management.

So far, ERP has enabled companies to cut cycle-times by 15 percent, clean up inventory data, and improve capacity utilisation. However, that is not enough since it has generated only efficiencies, not competitiveness.

Companies want to move into a build-to-order mode, translating into mass customisation on the shop floor, using different designs created to meet different customer needs. So it becomes imperative for the company to link product development directly to customer requirements and of course, to manufacturing, procurement, and inventory management. That’s the function a PDM system will serve.

Increasingly, companies are coming around to the view that they can succeed in the future by identifying and growing specific competencies. And for many of them, it is their product development skills where such competencies are embedded.

Considering the arguments stated above it is clear that ERP must be enriched with a comprehensive PDM or engineering management system.

The author is Director at Cadd Solutions. He can be reached at kvdaniel@caddsolutions.com