PLM for the Mid-market Supply Chain

A better look at a behind-the-scenes catalyst

In today's global economic climate, companies around the world — from large OEMs (original equipment manufacturers) to mid-market manufacturers — face enormous challenges. It is easy to write off the problems of mid-market companies as comparatively insignificant. After all, they're smaller; doesn't that mean their problems are smaller too?

In reality, today's mid-market companies' face the same challenges as large OEMs, and they face them with fewer resources, less money and less ability to absorb risk. In addition, they have to deal with the increased competition in the mid-market, the increasing demand for a shorter product lifecycle, the pressure to develop more complex products than in the past, the management of multiple parallel projects and being part of the supply chain.

The Evolving Role of the OEM

The position of mid-market companies within the supply chain has undergone dramatic changes. OEMs, which may or may not be mid-market companies themselves, require increasingly more value, efficiency and sheer output from mid-market suppliers, and tend to deal with only the highest-level core and competitive competencies internally. For instance, in some industries, approximately 65 percent of final product development is outsourced to mid-market suppliers. Given such increased demands, suppliers need to differentiate themselves competitively by bringing specific knowledge and innovation to their products and to their relationships with the OEMs — it's a matter of survival. If OEMs don't see the results they need as quickly as required, they'll gladly replace one supplier with another, or possibly shrink the supply chain altogether. Add to that the unpredictability of other suppliers' actions (which affect the entire chain), and it's clear that PLM isn't a luxury — it's a necessity.