PLM today, it seems to me, is often similar to home computers in the early years. A few people had one, but most of them didn’t really know what to do with it, at least not anything really useful. The Commodore 64 I got when I was a teenager for example came with a Basic interpreter, which allowed users to create their own Basic programs. But what type of program should I write? What did I need? Short of a good answer I ended up writing a contact database that allowed me to manage all my personal contacts I had at that time. It was certainly a great learning experience for me to teach myself to program in Basic and write my own software application, but the contact information of the few friends I had then could just as easily have been managed in a little notebook.

How is this similar to PLM? Well, many companies that use PLM today don’t really seem to have a greater purpose for it either. Yes, they manage some engineering and CAD data and maybe automate a few engineering processes, but frankly, an average (and much less expensive) PDM or CAD data management system would generally suffice for that.

What many companies are missing today are business critical applications or uses for their PLM system. Or, in other words, a real purpose. As an analogy, think smart phones. You don’t need an expensive smart phone to call someone. But all the other capabilities of smart phones, such as GPS navigation, camera, web browsing, etc make it worth for us to spend more money than for a simple cell phone.

So what are the killer PLM applications? What are the uses that give PLM a real purpose, add tremendous business value and provide companies a true competitive advantage? I call these the Strategic Capabilities of PLM because they usually help companies to execute on one or several critical aspects of their business strategy.

Some of these Strategic Capabilities are New Product Development Management, Innovation Management, Systems Engineering, Virtual Product Development, Mechatronics, Collaboration and Custom Product Configuration. They enable companies to manage their entire new product development and innovation processes, activities and data, virtually engineer, simulate and test systems consisting of mechanical, electrical, electronic and software components, seamlessly collaborate across functional and geographical boundaries, and instantly configure the desired product by choosing from all technically possible and commercially available options.

Generally there are no standard modules in the PLM software that enable these Strategic Capabilities. Rather, they are based on and require a combination of Extended PLM Capabilities, which are usually available as functional modules of the PLM system, such as Configuration Management, Requirements Management, Portfolio & Pipeline Management, Program & Project Management, etc, but which most companies today have not or have only partially implemented.

So how can you give your PLM system real purpose beyond just being a repository for engineering data? First, as Stephen Covey said in his book The 7 Habits of Highly Effective People, “begin with the end in mind”: Understand the Strategic Capabilities of PLM and what would be possible for your company by leveraging them. Second, determine which of these Strategic Capabilities can help to executive on your business strategy and meet your goals. Then chart a path or develop a roadmap on how to get there, i.e. what will be required to get to the desired Strategic Capabilities.