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Does your company need PLM or ERP?

The question “Can ERP software vendors do PLM?” Is a return to a way of thinking that contrasts with the concepts of “best in its category” and “integrated systems”. The bottom line is, “You need PLM to do PLM.
Then figure out how to integrate ERP. “

In the end, it all comes down to numbers. Using applications from manufacturers that offer customized solutions offers you a better focus on resources dedicated to providing a robust set of features. Flexibility and freedom to respond to your company’s needs are crucial and relying on just one source always carries some risk. This solves some problems for you, and communication between PLM and ERP systems is a very important part of your business infrastructure. However, taking this integration as the most important criterion when choosing a PLM solution seems to be putting things upside down. Choosing the best in your category seems like the best approach. Choosing a solution that offers your company the most robust set of features and not compromising with one supplier is a better path to success. There is no need to look for a compromise when you can have all the benefits of using applications that share a common platform, even though they are produced by different companies that are experts in different fields.

Discussions about whether to choose the best from your category or integration were very popular 10-20 years ago. Since then, the variety of PLM products has been reduced to 10-15 systems. Large PLM manufacturers buy everything that can increase their portfolios and revenues, if you are a large company, the choice of large systems comes down to a few.

The same could be said for ERP systems. Those that have PLM functions come down to the two best Systems – SAP and Oracle. For others, ERP is either an OEM PLM system or a system that provides very limited component structure management capabilities that are not compatible with CAD requirements.

So, for the question of ERP PLM versus PLM, the first group is technically represented by 2 systems – SAP and Oracle. The story of the SAP PLM solution is interesting. Although this system is comprehensive, it is often used as part of a broader SAP application for a company. So, SAP PLM is a solution for SAP clients and there is nothing to think about. As Oracle PLM has at least four different PLM systems (some of which were purchased and some are the result of Oracle development). So, the simple answer to the question is: “Yes – ERP can do PLM”, but if it can work well enough, you can’t answer if you don’t know the specific context of a certain company.

The question “Can ERP do PLM” leads to the question of the reverse scenario – What if the manufacturers of PLM solutions would expand into the field of ERP? Does this make sense? What does this mean? ”There are several examples in recent years of PLM companies’ increasing interest in production systems. There are a small number of systems in the domain of combining PLM and ERP functions. One probable future scenario is that we will see more and more ERP functions within PLM systems, as customers increasingly demand integrated systems.

At the same time, PLM-ERP integrations are the same as 15-20 years ago. They are complex, expensive, and never immediately ready for use. It is part of the basic implementation of a PLM solution for a large company, but this part is always laborious and is often left to some external, outsourcing company. The fact that both sides (PLM and ERP) have little interest in improving this integration. Why? Maybe because of opposing business models. PLM and ERP basically focus on keeping data in databases and selling an application/function to a company. While the basic model (such as PDM and MRP) of each system is usually protected, many other domains in each system overlap.

Conclusion?

Both PLM and ERP have a basic business model based on data ownership. Therefore, both ERP and PLM are interested in how to provide maximum coverage and functionality while reducing data leakage outside the organization. But there is a light at the end of the tunnel about the PLM-ERP debate. The situation is changing with the introduction of new “on cloud” products (in the cloud). Cloud products are much more agile and provide a much better infrastructure level than 15-20-year-old architectures, making many old impractical scenarios easy to implement and leaving the PLM / ERP world in the dust to continue its battle for data ownership and complex integrations.