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How Product Lifecycle Management makes a difference in your industry: 
AEROSPACE
AUTOMOTIVE
CONSUMER
CONSUMER ELECTRONICS
DEFENSE
EDUCATION
INDUSTRIAL EQUIPMENT
HIGH-TECH ELECTRONICS
LIFE SCIENCES
PLASTICS
SHIPBUILDING
TELECOM
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Putting Products First By Kevin P. Hopkins Manufacturing is expensive. But few people know that 70% of a product's cost is absorbed before the manufacturing process begins. A surprising proportion of a product's cost is actually set in motion long before the first die is cut or screw is turned. According to the Aberdeen Group, a high technology market research firm, fully 70% or more of a product's cost--and nearly all of its competitive characteristics-- stem from the design and engineering of the product. Moreover, researchers at MIT have discovered that the costs of implementing changes in a product grow exponentially after the decision to manufacture the product has been made. On average, the MIT researchers estimate, the costs of changing a product's characteristics are 10 to 100 times higher during the "build" phase than they are during the "design and engineering" stage, and 1,000 times higher during the "post-release/support" phase. The message to manufacturers trying to compete in a increasingly global and highly competitive economy, therefore, couldn't be clearer: get your products right, and get them right the first time. Getting Back to Basics The impetus to achieve this goal is more pressing today than perhaps it has ever been. "These are difficult times for business," says C. Richard Harrison, president and CEO of PTC, a Needham, Mass., based product development software maker. With the economy still struggling and new, low-cost manufacturers emerging throughout the world, the challenges to established manufacturers are continually intensifying. And yet, he insists, "the answers may be simpler than we realize. We need to get back to what matters most--the products we make and the tangible value they create in the marketplace." To help manufacturing companies implement this increasingly important "back to basics" focus on products, PTC has established a comprehensive business strategy called "Product First." The company believes that a Product First strategy, with its emphasis on ensuring that product development centers on great products, can significantly strengthen the ability of manufacturing firms to focus the attention on product quality and innovation that they need to succeed in competitive marketplaces. Manufacturing firms stand to benefit enormously from this approach. "While efficiency and savings affect the bottom line," says Harrison, "new products drive top-line revenue growth." These new products, he contends, will be the main factor in ensuring long-term business success for the manufacturing sector in the coming years. Three Key Principles According to Harrison, Product First companies are characterized by their enthusiastic adherence to three key principles: • Understand that success in business stems from an overarching commitment to superior products. This orientation "starts at the top and is ingrained in company culture." • Place product development squarely at the intersection of customer satisfaction, operational efficiency, and the business goals of the company, "establishing the unifying framework for all business process systems to contribute to corporate growth." • Maintain a "systematic and repeatable approach" to translating innovative product ideas into the desired business results, a step that Harrison describes as the key to delivering predictable and consistent revenue. Empowering Desires The bottom line: a Product First strategy can be a powerful engine for product innovation and quality enhancements. And if the strategy is diligently implemented, it can place manufacturing firms back on the path of delivering the exciting new products their customers want--more efficiently and more timely than ever before. The good news is, businesses' success is rooted in exactly that: meeting customer desires quickly and efficiently. "We need only begin as we always have," says Harrison, "with an idea and the desire to create something new, something better than what existed before. Empowering that most intrinsic of human desires is what the 'Product First' movement is all about." |
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Copyright 2003, by The McGraw-Hill Companies, Inc. |
