Why do we need PLM when we have ERP?May 27, 2015
ERP and PLM
Enterprise Resource Planning (ERP) is a business software (often a suite of softwares) that collects, stores and manages data. Such data comes from business activities like product planning, product cost analytics, manufacturing service, product delivery, marketing, sales etc. ERP system is vital in inventory management and ensuring that the supply chain is managed effectively. The level of management depends on the maturity the organization has.
Product Lifecycle Management (PLM) on the other hand is a process (often managed by a software tool) that primarily focuses on product data and design. Role of PLM starts right from the idea of the product and extends till the product is manufactured. It is often linked with other 3D designing tools that help in visualizing the product.
ERP and PLM Synchronization
Often in mature organizations PLM and ERP are synced real time. While PLM help in designing and releasing the product, ERP helps in planning how the product will be manufactured and sold. So a real time sync is important to tract any changes that may have happened to the product. Organizations that have synchronized PLM and ERP are better off with their counterpart in many ways –
- Decreased product scrap.
- Effective Inventory Tracking.
- Improvement in Time to Market
- Better cost analysis.
Implementation of both ERP and PLM is very costly. Organizations are often tempted to leave out PLM and implement only ERP. It is also important to note that – though PLM and ERP both have an important position in the manufacturing world, organizations should not get carried away and implement only what is necessary.