Enterprise resource planning (ERP) has been in use since the 1990s. It is ubiquitous in large companies and is increasingly used by smaller businesses to manage their data and business activities. Product lifecycle management (PLM) software is newer. It has raised an important question many companies now face: Is it better to upgrade the old ERP system or turn to the more modern and agile PLM?
What Does ERP Software Do for You?
ERP is useful for managing general business operations, including manufacturing, distribution, labor, accounting, finance, and customer service. The focus of ERP is necessarily narrow: it takes the product already developed and helps businesses move it onto shelves, managing the logistics and data of making, moving, and selling.
What is Product Lifecycle Management Software?
PLM is different from ERP in that it has a broader scope and more focus on the creative and developmental components. It includes every element of a product’s lifecycle: creation, updates, production and costs, marketing, supply, retail conditions, branding, warehousing, and more. Products like Centric Software PLM Systems can be used alone or integrated with existing ERP systems. Many businesses are focusing more on PLM and less on ERP.
How PLM Takes Businesses to the Next Level
ERP and PLM are similar in that they collect and manage data to help businesses run better. They are not the same, though, and ERP cannot do everything that PLM does. PLM uses data from every single stage of the development of a product. ERP misses some stages and provides incomplete data as a result. PLM takes into account engineering changes and communicates those changes throughout the company.
Here are some other essential areas in which PLM can make businesses faster, more efficient, and more effective, and where ERP falls short:
- Newer PLM systems are designed to work with the quick-changing lifecycles of many modern products, like fashion and luxury goods.
- PLM makes a more direct impact on revenues by including design development and quality and compliance management.
- These areas that PLM hits and ERP misses also benefit the brand and increase brand impact and recognition. Brand differentiation is essential in today’s fast-changing product market.
- The data collected by PLM systems changes and adapts quickly. The system catches those changes and ensures everyone has access to them. Everyone in the company can work collaboratively and more effectively with the same information.
- PLM accelerates development time. This can help you get products to market sooner, increasing return on investment.
- PLM’s fast development is especially crucial, for businesses working with on-trend products. It can help you respond more quickly to the changing market and trends.
- You’ll be more efficient using PLM with fewer errors in data and less time spent searching on product information.
- PLM improves supplier relationships by cutting down on the questions suppliers need to ask.
The Importance of PLM
Most businesses already have ERP systems in place. But relying solely on this type of software poses risks. Without PLM, mismanaging changes in products is likely. This, in turn, leads to financial errors and missteps. The benefits of PLM are essential and can be boiled down to basic factors important to all businesses: increased growth, brand recognition, and revenues.