AMR's Tips for Winning with PLM
Successful new product introductions are rare, but infusing supply chain constraint simulation into PLM processes can improve time to scale and improve product success rates. The perfect lab formula and packaging complexities create hurdles to scale and slows down profitability for new products. Some of these challenges include:
- Working capital constraints
- Low inventory replenishment for other products
- Increasing supplier risks
- Sustainability trends
- Fickle consumers
- Regulatory constraints
- Retailer SKU rationalization and private label competition
During a CGT Web event on Nov. 12, 2009, Allen Johnson, research director, Industrial and Consumer Value Chain for AMR Research, and Rory Granros, director, Global Process Industry and Product Marketing for Infor, uncovered how consumer packaged goods companies can overcome these challenges despite a highly competitive environment and current financial conditions. Here are some highlights from the Web event:
--Johnson kicked off the event with an overview of the market and explained what it takes to "win at the shelf." He reported that consumer goods companies have unprecedented access to consumers who get unfiltered inputs on what they want and what they will buy. For example, 70 percent of consumers are selecting products before they go out to buy them, making the first moment of truth start at home; and coupon redemptions are up for the first time in 10 years, driven by online versions. "Consumers are hungry for the right information," Johnson added. He left the audience with some points to ponder as product manufacturers: Product success rates are down; an IBM survey confirmed that less than 20 percent of consumers trust food companies to deliver a safe and healthy product; and private label/store brands now account for 20 percent of the market basket and are projected to grow 25 percent in 2010. With the preponderance of data and the complexity in distribution and supply chains combined with the information consumers have at their fingertips, CG manufacturers need to leverage all the available data to ensure successful new product launches. "Innovation is a core element in demand processes and PLM is technology/methodology that improves it," he concluded.
--Granros rounded out the event by contributing insights from a solution provider standpoint. Since product success rates are down as Johnson had revealed, Granros posed the question: Are your process, systems and data up to the challenge? "I don't know of anybody that plans for a launch. I'll hear people say I have an introduction process, and it will work its way into the sales and operational planning process, but it really isn't actively planned, and one of the biggest reasons for product failure is lack of inventory," he said. Granros believes that the PLM process has to be extended from R&D into the supply chain and it has to become more holistic. "I'm not saying PLM will replace sales and operational planning, but PLM has to integrate to sales and operational planning processes for it to be more successful," he added.
To listen to this Web event in its entirety, click here.
- Working capital constraints
- Low inventory replenishment for other products
- Increasing supplier risks
- Sustainability trends
- Fickle consumers
- Regulatory constraints
- Retailer SKU rationalization and private label competition
During a CGT Web event on Nov. 12, 2009, Allen Johnson, research director, Industrial and Consumer Value Chain for AMR Research, and Rory Granros, director, Global Process Industry and Product Marketing for Infor, uncovered how consumer packaged goods companies can overcome these challenges despite a highly competitive environment and current financial conditions. Here are some highlights from the Web event:
--Johnson kicked off the event with an overview of the market and explained what it takes to "win at the shelf." He reported that consumer goods companies have unprecedented access to consumers who get unfiltered inputs on what they want and what they will buy. For example, 70 percent of consumers are selecting products before they go out to buy them, making the first moment of truth start at home; and coupon redemptions are up for the first time in 10 years, driven by online versions. "Consumers are hungry for the right information," Johnson added. He left the audience with some points to ponder as product manufacturers: Product success rates are down; an IBM survey confirmed that less than 20 percent of consumers trust food companies to deliver a safe and healthy product; and private label/store brands now account for 20 percent of the market basket and are projected to grow 25 percent in 2010. With the preponderance of data and the complexity in distribution and supply chains combined with the information consumers have at their fingertips, CG manufacturers need to leverage all the available data to ensure successful new product launches. "Innovation is a core element in demand processes and PLM is technology/methodology that improves it," he concluded.
--Granros rounded out the event by contributing insights from a solution provider standpoint. Since product success rates are down as Johnson had revealed, Granros posed the question: Are your process, systems and data up to the challenge? "I don't know of anybody that plans for a launch. I'll hear people say I have an introduction process, and it will work its way into the sales and operational planning process, but it really isn't actively planned, and one of the biggest reasons for product failure is lack of inventory," he said. Granros believes that the PLM process has to be extended from R&D into the supply chain and it has to become more holistic. "I'm not saying PLM will replace sales and operational planning, but PLM has to integrate to sales and operational planning processes for it to be more successful," he added.
To listen to this Web event in its entirety, click here.