PLM Selection Process: Advice on How to Select Enterprise Software w/Leon Lauritsen
In this episode we will be talking with Leon Lauritsen from Minerva PLM about the process of selecting a PLM system, how to minimize potential traps, and ensure that you select the best PLM for your organization.
Leon Lauritsen is the vice-president and partner at Minerva PLM. Leon has been in the PLM world for many years, and has been involved in many different aspects of it, from IT programming, to business consulting, project management, and business development.
Leon has been a passionate advocate on how to improve the PLM selection process, and has written extensively on this topic.
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- Leon states that in many cases, the PLM vendor selection process is biased. When asked why companies wouldn’t want to choose the best vendor that would emerge from a fair competition, he answered that most of the time the selection process is not straightforward. People will often choose a vendor based on what they consider important. Oftentimes, the decision makers will not involve the IT department, and hence make a decision purely based on wishful thinking rather than technical realities.
- If a company is looking to purchase a PLM solution, they shouldn’t put most of their focus on asking vendors to demonstrate basic features, such as document management. Those are features that would be present across almost all systems. Rather they should think about what they are aiming to achieve at a strategic and operational level. They should understand what the critical aspects are that they want to achieve as a company in the short term and the long term, as well as considering what kind of support they will need from the vendor.
- Once those short-term and long-term goals are identified, companies should also think about more complex use cases, and ask the vendors to demonstrate how their PLM would perform on those issues.
- Leon believes that most people are so focused on short-term gains that they tend to minimize the need to understand the complexities of making changes when the need arises. In the highly unpredictable world we live in, flexibility is key. If a system cannot quickly adapt, engineers will need to find a workaround and will end up developing their own shadow tools, such as Excel spreadsheets. Companies often find themselves with tools popping up everywhere and the data is not centralised anymore.
- Having a sound training structure is as important as selecting a good PLM. At the end of the day, if no one understands how to use it, it won’t matter how good the system is.
- Calculating the cost of ownership is very complicated. The acquisition cost is a bit easier to estimate, however the implementation cost is the hardest part. Most of the time, requirements issued by companies are quite abstract, so vendors will have to make assumptions. As they are all trying to win the deal, they will most of the time embellish their capabilities.
- As getting an honest and straightforward answer from the vendor is unlikely to happen, Leon strongly urges companies to understand the technical difficulties of implementing and making changes in-house. This is why it’s important to also involve people from the IT department in the negotiation process. Otherwise, companies will always be at the mercy of the vendors.
- Another cost that is important to consider is the upgrade cost. It’s a difficult one to estimate so Leon advises companies to go and ask the vendor’s installed base how much it cost them to do an upgrade and how long it took.
- Another complexity of selecting a vendor is the licensing model. It’s hard to predict what kind and how many licenses companies will need in the long run. An issue that Leon often sees is that PLM vendors will typically give a discount on the license in the first contract, but a few years down the road, when companies ask for a new license, the price isn’t the same as the original one. It’s hard to avoid this type of trap but Leon recommends thoroughly investigating the typical licensing model of vendors that you are engaging with.
- When it comes to implementing the PLM, it’s important for companies to realise that they need to be in control. PLM is a company’s strategic piece of software. It’s a foolish idea to not be involved in its implementation process. Obviously there are varying degrees of involvement, but companies should at least have a minimum amount of capabilities in-house.
- Minerva PLM, powered by Aras, combines the flexible, model-based technology inside the Aras Innovator platform with industry-specific features that have been developed through Minerva’s 25 years of enterprise software implementation experience.
- Their solution, Minerva PLM, is a result of the best practices that the Minerva team has established over decades of close collaboration with customers across different industries and incorporates the knowledge and experience from more than 100 successful Aras Innovator implementations.
- Their approach: understand the customer, what their needs are, and what their business challenges are – a much more customized, personalized approach.
- Minerva PLM also offers predefined packages based on specific industries. Those packages are unique as they are the result of years working with specific industries and getting to know exactly what clients need, and the type of capabilities and most essential use cases.