Is PLM software IT's new darling?

PLM software merges into the fast lane, fueled by global trends

The Economist’s quarterly technology issue just came out, and i started flipping through it with the disdain I usually reserve for the dumbed-down technology primers you typically find in an American news magazine. Those Brits, however, do a good deep dive. There’s nothing like seeing this slightly stuffy, slightly hip mag get down and dirty with topics like mash-up Web sites, traffic jam analysis, online-tagging trends, and the search-vs.-folders debate.

The piece I ended up reading was on PLM (product lifecycle management) software and how it has grown from wonky CAD systems in the ’80s to a mainstream corporate tool for designing a wide range of products and getting them to market. The article had some sexy photos showing the typical stuff we all know gets designed virtually -- the latest space-age electric shavers, corporate jets, and prototype cars.

But it also mentioned that Heinz is using PLM software to track the different ingredients that go into its line of condiments, and that large retailers are using PLM on their private-label products to better compete with the big consumer brands. Apparel companies are using it for better sourcing. Drug companies are using it to manage package design. PLM software has gone mainstream, claims The Economist, which drew heavily on data from AMR Research.

In a recent report, AMR’s Michael Burkett says the PLM market is growing robustly and is expected to jump from around $10 billion this year to $15 billion in 2009. The biggest factors driving this growth, he says, include globalization (design teams in different countries have to collaborate electronically), compliance (every decision and product input must be tracked) and the need for faster time-to-market (GM, for example, has slashed its vehicle-development time from 48 months to 18 months).

The Economist’s article makes a pretty weak case that PLM as a category may disappear as its core product-data management functionality gets mainstreamed into platform software from Microsoft, Oracle, SAP, and IBM. Although these companies could very well acquire some of the PLM pure-play vendors (Cadence Design Systems, Agile Software, PTC, UGS, etc.), I highly doubt the market really wants 3-D modeling as part of Outlook nor would they want package-design prototyping as part of ERP.

A better question might be this: As all design and development becomes electronic and structured, what happens to the sheer inspiration of sitting down with a clean sheet of paper? What would Walt Disney think? Or Thomas Edison? Would Howard Hughes, a notorious micromanager who loved to touch the prototypes and make radical course changes in mid-design, hate PLM? Or would he be right there with his hand on the mouse, loving every minute of it?