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CEOWORLD magazine - Latest - CEO Insider - Driving digital transformation with Configuration Lifecycle Management

CEO Insider

Driving digital transformation with Configuration Lifecycle Management

Henrik Reif Andersen

The manufacturing industry is facing digital disruption on numerous fronts – and this is driving digital transformation. Increasing competition and changing demands means the pressure is on organizations to reduce costs, improve customer experience and increase profitability. All of this means that organizations must rethink how products are designed, manufactured and sold.

As digitalization, automation and software in products increase, it’s crucial to ensure consistency and reliability in the delivery of products to meet customer needs. This is where Configuration Lifecycle Management can play a key role.

Siloed processes are hindering transformation efforts

As organizations grapple with digital transformation, one of the biggest hindrances is the siloed functional areas and systems. You have an engineering department that’s focused on engineering the products, and then you have the marketing, sales and manufacturing departments. Traditionally, the way information has flowed between these different departments has been through disparate systems or manual processes like Word and Excel documents.

This method might have worked in the previous era, but it won’t suffice for today’s digital economy where you need to be able to get products to market much more quickly. Manufacturers need a solution that aligns every business function that touches configured products – from engineering and sales to manufacturing and service – to a single source of configuration truth. This type of enhanced collaboration that supports cross-functional teams can significantly decrease time to market – and remove costly errors in order fulfillment. 

Improving the customer journey

When it comes to manufacturing today, staying competitive really all comes back to the customer journey: how do we improve it and make it easier? Today’s customers, also in the B2B segment, expect to be able to self-serve in terms of exploring the options. They want to know what products are available, how much they cost, and be able to order the products themselves.

To use an example from the consumer world, think about buying a car. You need particular features, including a particular type of engine and amount of horsepower. Is it intended to transport your family, meaning you will need a lot of space? You have these criteria, and you want to find out what kind of car you can get that meets all these needs. Today, customers spend a lot of time looking online before they reach out to a dealer. It’s estimated that before you go to the dealer to look for a new car, you will have spent more than 20 hours of research and exploration time online.

If you, as a manufacturer, are not in that game, you’re losing market share. You need to connect all those functions and systems mentioned above. You need to be sure that when the customer is exploring the opportunities, this is really a product you can build and provide pricing for. And for this to happen, these systems must work together. They have got to be synchronized and aligned on what products are being offered and all the different options/configurations. For manufacturing companies, this is a huge challenge.

Enter Configuration Lifecycle Management 

Manufacturers need what’s called Configuration Lifecycle Management (CLM), which ensures consistent product configuration data across all those functions. It establishes a single source of truth on the thousands, millions or more potential product configurations that can be manufactured, sold and delivered to customers. By deploying a Configuration Lifecycle Management solution, manufacturers of complex products can improve time-to-market, lower risk, increase product quality and ensure a seamless product lifecycle. 

In addition, Configuration Lifecycle Management provides a reliable single source of truth foundation that can be updated in real time to reflect changes in the configuration options that are available. This, then, enables companies to adapt to new market trends, customer demands and business models faster than the competition, providing them with a significant competitive advantage. 

Enabling cross-functional collaboration

Research from Gartner showed that 36% of heavy manufacturing CIOs whose organization had experienced some form of disruption said operating cost competitiveness had fallen behind. Senior leaders and executives in the industrial sector have the difficult task of helping to steward their organizations’ digital transformation while reducing cost and improving customer experience.

Configuration Lifecycle Management is an efficient and scalable approach for providing reliable, up-to-date product configuration information that can enhance engineering, manufacturing, sales and service solutions. But the real value of Configuration Lifecycle Management is in providing a platform for cross-functional collaboration that can transform the organization and not only make it efficient but also more agile, responsive and competitive.

Written by Henrik Reif Andersen.

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CEOWORLD magazine - Latest - CEO Insider - Driving digital transformation with Configuration Lifecycle Management
Henrik Reif Andersen
Henrik Reif Andersen is the chief strategy officer and co-founder of Configit, the global leader in Configuration Lifecycle Management (CLM) solutions and a supplier of business-critical software for the configuration of complex products. He holds a doctorate in computer science from the University of Aarhus and has more than 25 years of experience in IT development and research.

Henrik Reif Andersen is an opinion columnist for the CEOWORLD magazine. You can follow him on LinkedIn.