‘Product Lifecycle Management’ (PLM) is the process of managing the entire lifecycle of a product. The objectives of PLM are shortening the ‘Time To Market’ (TTM), reducing development costs, improving quality, identifying new markets and limiting the burden on the environment if the product is ‘End-of-Life’ (EOL).
PLM is initiated by the American Motors Corporation (AMC) in 1985. The car manufacturer was looking for a way to accelerate its competitiveness by shortening innovation and required time-to-market. Nowadays, Product Lifecycle Management is applied in virtually every sector.
Each product on the market goes through four different phases: development, growth, maturity, and decline. These phases are described by the ‘Product Life Cycle’ (PLC). The duration of each phase can vary from several weeks to multiple decades. Not all products go through all phases, because some products never reach the market. However, every product that reaches the market, will disappear at a certain moment (decline).
The intended result is that the red line in the figure above shifts to the green line so that a higher yield can be achieved. An earlier introduction to the market of a new product or service and a faster growth to maturity will increase the competitiveness and the profitability. To achieve this, organizations organizations need to understand the market, competitors and the technology well.
PLM-systems help organizations managing the increasing complexity and technical challenge. PLM-systems contain all available information about developments, markets, techniques, processes and the own organization. In this way, PLM-systems support the management process of a product or service in each of the four lifecycle phases and thus form the backbone for companies. Since the objective is minimize risks of disturbances during launching the product, PLM works closely with Design for Six Sigma.