Wednesday, November 19, 2008

SAP Automotive Symposium 2008: Shorter Time to Market with PLM Solutions

On the occasion of the SAP Automotive Symposium on November 4-5th, 2008 in Stuttgart, Germany, SAP, along with its partners, introduced innovative solutions for the automotive industry. I attended the event for insight into SAP’s efforts to support the automotive industry in meeting future IT challenges.

Various client speeches, such as those of Mercedes-Benz, Claas, Knorr-Bremse, Ford, Daimler, Robert Bosch, Mahle, BMW, and Porsche, delivered solid examples of how IT cannot only support the automotive business but also yield added value with the latter becoming more and more a prerequisite for gaining a competitive edge in the long run: long before the outbreak of the financial crisis, the automotive industry has faced massive challenges.

The automotive sector is characterized through its strong globalization of markets with accompanying risks through currency fluctuations, and increasing pressure of innovation and prices. Simultaneously, there are increased quality requirements on the customer side as well as proliferation of variants. All of this set against the background of product development and production that must be environmentally sustainable. "On one hand, IT can meet these requirements by reducing IT costs—through the standardization of systems, processes, and applications, by consolidation and virtualization, as well as through intelligently using near-/offshore sites." “On the other hand, IT can also contribute remarkably to meeting the automotive industry’s core requirements. In this context, an essential factor is the shortening of time to market. One topic continuously gaining in importance is the integration and usage of PLM solutions.”

In my opinion, the main goal of PLM solutions is to shorten the entire product development time, namely through the synchronization of all processes involved, as well as through the integration of product designers and developers, external suppliers and production schedulers via one joint platform.

I think that the data integration between business processes and production processes will play a central role. “SAP is well aware of this central role, which is not only evident by the takeover of Visiprise in the area of MES, but also by SAP’s investment in the further development of its PLM solution SAP PLM.” As a result, there will be an extension to the SAP PLM solution from November on, which, among other things, will include a new authorization concept. This will accommodate the requirements of an increasing number of customers who are willing to cooperate with external development partners and give them role-based access to a joint database.

Apart from the further development of the SAP PLM suite, I also observes the necessity for additional investment on SAP’s part, especially when it comes to covering the product developers’ needs: “Product developers traditionally work with graphic or geometric information and are familiar with a Computer-Aided Design (CAD) environment. SAP addresses the CAD world by integrating the CAD viewer of Right Hemisphere. However, in my opinion, the weaknesses of SAP PLM in the developers’ world have not yet been fully eliminated.”

Furthermore, a path breaking market decision is still outstanding with regard to the Product Data Management (PDM) system, the core of each product development cycle where the parts lists relevant to production are generated. Here, SAP offers an appropriate solution, SAP PDM, but also classic CAD providers, such as Dassault Systèmes, PTC, or Siemens PLM (formerly UGS) claim the PDM responsibility. I am eager to learn if and how SAP is going to further integrate the CAD world, and who is going to dominate the PLM/ PDM market: the PLM providers from the CAD world, or a supplier like SAP from the ERP world?

Since it is the ultimate ambition of PLM solutions to shorten time to market, the integration of additional systems plays an important role: end-of-warranty dates of customers can be reflected to production and accelerate the development process of new products accordingly (integration of CRM systems). Furthermore, global networks of production sites with various production capabilities can be involved in the production scheduling process quite early (integration of SCM systems).

In the automotive industry there are comprehensive possibilities to create real added value by using IT. When it comes to shortening time to market though, the integration of various systems is gaining an ever-high significance. As demonstrated at the Automotive Symposium, SAP is certainly well positioned with its solutions offer around PLM, SCM, CRM, MES, etc.