It has been said that 2008 was an "education" year for PLM and, over the past two years, it has become a more recognizable solution among fashion executives. But what will it take for fashion companies to realize the benefits of, and invest in, PLM in the coming year? From my perspective, there are three major trends that will help accelerate the adoption of PLM in 2011:
Beyond Single Version of the Truth
I do think that fashion companies in retail, footwear and apparel understand the benefits of what we refer to as the "single version of the truth," but they might be in different stages in leveraging the cost/benefits equation since this can sometimes be hard to measure.
Fashion companies who don't already have a formal PLM system in place are recognizing that they cannot continue to scale to the pace and complexity that consumers are demanding simply by adding more people to the process. They need to work differently, collaboratively and take advantage of the benefits inherent to PLM. In order to measure benefits, companies need to examine both cost and speed, and that can be complex since you're measuring the cost of products, but also sample costs which may be buried in product margins. And you're trying to measure the value of speed.
But if you can visually review your assortment from different aspects before you start making physical samples, you can save weeks of time of otherwise iterating through the wrong product. And if you're updating product details but your supplier doesn't have clear visibility to those changes, then they're working against outdated information, and producing the wrong samples anyway.
Plus, if you can capture the materials used across different product lines, brands and genders you gain tremendous leverage in negotiating with mills and vertical suppliers. There can often be opportunity in consolidating some very similar materials used by different design, development and sourcing teams that don't have visibility into what other teams are doing. And those material savings can often amount to tens of millions of dollars annually.
Driving Top Line Growth, as Well as Bottom Line Savings
When looking at investments, many CIOs still consider ERP systems as a way to encourage efficiency and improve the bottom line. What they often don't realize is that PLM has a strategic opportunity to impact the top line as well as the bottom line and drive increased sales.
Fashion CIOs should look at shorter time-to-market as one of the best opportunities for their company. If you can reduce time-to-market, you really improve your ability to recognize and respond to fashion and sales trends. PLM helps give companies time back to test and chase their "winners," making more of what consumers will pay for, which drives sales and reduces markdowns. At the same time, fewer samples can represent hundreds of thousands of dollars of savings. These are the underappreciated elements of PLM's value proposition that CIOs should more closely consider when setting their technology agendas.
Continued Drive for Speed-to-Market/Speed-to-Innovation
In addition to the time-to-market benefits that come with global visibility, PLM also helps fashion companies become more nimble through materials sourcing and reuse. With visibility into what's working and what's not, fashion brands know which materials to chase and which to avoid. And materials can be leveraged across styles -- if one isn't selling, they can use it for another style or even in another brand or division while it's still market-relevant.
Companies are also trying to respond to the sustainability challenge, whether that's knowing what materials are organic or eco-friendly, or being able to identify suppliers who have responsible methods for handling waste-water or denim treatments such as sand-blasting.
Some of our design teams tell us they find it extremely helpful to know what materials are even available to them, and how those materials can be used when planning eco-collections. This can also help accelerate continuous innovation. For example, consider a collection that didn't start out as eco-centric, but perhaps a new main material has been incorporated, such as bamboo or organic cotton. At this point, the product team could decide to apply a new hangtag to inform customers about the features and benefits -- and they may want to do it across all products using that new base material. With the "where used" capabilities of a PLM system, the list of products can be generated instantly and they can mass-apply that new hangtag.
Escalating pressure to lower product development costs -- combined with constantly changing consumer preferences and demands -- is dictating the need for a new strategy to bring fashion products to market. Some of the world's most progressive fashion brands already rely on PLM as the backbone to effectively manage these market pressures, and I firmly believe that based on their early success and proof points, 2011 will be a big adoption year for PLM.
About Susan Olivier
Ms. Susan Olivier is the Director of Market Development, Retail, Footwear and Apparel (RFA) for the ENOVIA brand at Dassault Systemes (DS), the world leader in 3D and Product Lifecycle Management solutions.
Olivier has more than 25 years of experience in the fashion industry with national and private brands, as well as specialty and department stores, including Reebok, Wrangler and Calvin Klein, Victoria's Secret, Bath & Body Works and JCPenney.
She joined DS in 2009. In her role, Olivier oversees all aspects of market development in the RFA industry for the DS ENOVIA brand, the online collaborative platform for global product information.
Prior to joining DS, she was with JCPenney where she was Business Applications Director, Cycle Time Reduction. Olivier has hands-on experience in product development, strategic sourcing, sales, technology and global change management. She has also led multiple software initiatives from the selection process through to implementation and value realization, and has in-depth knowledge of merchandise planning, global purchasing and supply chain management.
Olivier graduated Magna Cum Laude from Seneca College in Canada with a degree in Marketing; and Magna Cum Laude from Suffolk University in Boston with an MBA focused on International Business and Applied Technology.