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Thursday, November 5, 2009

Are ERP and PLM Talking About the Same Thing

Some may argue that the yield and scrap factors mentioned in the previous section are not truly semantic differences, and they are probably correct. This type of issue highlights a conceptual difference between the PLM and ERP systems. A scenario that highlights the need for conceptual alignment between the product design in the PLM system and the production information in the ERP system is the selection of alternates.

A specific revision of a design may allow for alternate parts to be used in production. Some of these alternates can be applied independently, while others can only be used in conjunction with other alternates. For example, an alternate power supply can be substituted for the primary power supply for a piece of equipment, but only if an additional capacitor or resistor is also substituted on the same unit. Couple this requirement with the potential that a specific customer may have an approved supplier list. The customer, for regulatory, commercial, or quality reasons, may only allow components from particular suppliers. This is another constraint on the alternates that can be used for a particular production order. A final complexity to be considered in alternates is the identification of required replacements by geographical or organizational boundaries. For commercial or regulatory reasons, it is common to have alternative part requirements in certain geographies or for certain commercial entities.

Without strong conceptual alignment in how alternates are defined between the product design and the production order, and therefore the PLM and ERP systems, material planning to accommodate multiple substitutions and approved supplier lists would be cumbersome if not impossible. If both systems don't understand alternates in the same way, or if they have different ways to characterize geographic and organizational entities, technical integration will not provide the additional business logic to correct the mismatch. In this case, inefficient and error-prone manual intervention will be required.

PLM solutions have to work with many other systems, not just ERP, so integration is not a new issue for PLM vendors. Most PLM vendors recognize the need for integration and have addressed the need in their toolkits. The additional work comes from integrating the concepts and semantics of one system to the next, if this business level integration has not already been provided between the two systems. This can be a big challenge for best of breed vendors, who may need to rely on systems integrators for much of this conceptual and semantic integration

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