Product Lifecycle Management (PLM) is the process of managing a product’s journey from conception, development, service and disposal. In other words, PLM means controlling everything related to the product from birth to the grave.
TABLE OF CONTENTS
What are the components of PLM?
The main features of PLM are:
- Planning and implementation documentation.
- Product structure (property bill) system.
- Centralized database (electronic file storage)
- Section and document handling and metadata management
- Material information tools for environmental compliance
- Product-centered project task assignment
- Workflow and process management for the approval of changes in the product
- Secured multi-user access with e-signature
- Export of data for loading downstream ERP systems
Why is product life cycle management important?
Product life cycle management is a practice that can make or break your ability to sell and enhance existing customer relationships. It helps companies develop loyalty by identifying opportunities that can add value to the equation of customers with key points on time. Other benefits from proper PLM implementation include shortening the time of product development, knowing when to adjust manufacturing efforts, and how to deal with potential issues in the marketing of the product.
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What are the 5 stages of the product life cycle?
German economist Theodore Levitt developed a five-staged model of product life cycle. It is based on his observations that the characteristics of a product may undergo a lot of change from its inception up to its phasing out.
Development Phase
In this stage, the product is conceptualized and materialized. This is the first stage every company has to take if they want to launch a product in the market. It will be where the bulk of pre-launch planning, proposals, testing, validating hypotheses, and adding necessary changes occurs. While a product is nearing the end of its development stage, a company may begin promotions to see how the market will react to its launch.
Introduction Phase
When the product gets approved for launch, the company will shift its attention from the development to the product’s introduction to the market. This stage demands a lot of marketing investment from the company because it will be the best means to let the consumers know about the product. Common areas of product introduction include print media, product placement, TV/radio commercials, and social media.
Growth Phase
This phase is defined by scalable sales and maintenance of the amounts invested in marketing. In an ideal scenario, the new product should at least break even with the cost of its development and marketing. This stage will take a long time, depending on the budget and resources of the company. Competition in this stage is high, so companies highly depend on keeping their repeat consumers while gaining new ones.
Maturity Phase
A product’s maturity is the highest point of the product life cycle. It is in this stage where the product has reached its maximum potential with the sales stabilizing. It is nearly impossible to see more growth once a product has reached the maturity phase. The main challenge in this stage is maintaining the good results of the product over time.
Decline Phase
All things have an end, even when it comes to products. The decline phase is simply when sales and market performance of the product begins to gradually have a downward thread. When this occurs, the company has to accept that the product is not as good as it is before. It is better to prepare for a replacement product than to invest money in trying to salvage an older one.
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