Sound Acquisition Planning

ARC Advisory Group says software-intensive plant systems need good planning to avoid delayed startups

ARC Advisory Group says software-intensive plant systems need good planning to avoid delayed startups

Dedham, MA — July 28, 2003 — Whether the impetus to get a new product to market in short order is to capture more of existing demand, be the first to exploit a new market trend, beat competitors to market, access a new customer base or simply generate revenue from a new product idea, the ability to achieve rapid time-to-market (TTM) is a key measure of success for manufacturers, according to a new Best Practices study from ARC Advisory Group titled "Best Practices in Acquisition Planning for Software-Intensive Plant System."

Achievement of this goal is continually impacted, however, by delayed production startups caused by increasingly software-intensive plant systems.

The complexity and sheer volume of software content in today's plant floor systems is increasingly impacting new product time-to-market, according to the research firm. Growing horizontal and vertical integration requirements driven by production-level scheduling, routing, tracking, quality and regulatory systems, plus supply chain management, enterprise resource planning (ERP) and other enterprise applications compound the issue.

ARC said these escalating requirements are contributing to the need for best practices, and therefore its research is drawn from a survey of manufacturers and their system providers, plus activities in government, academia and industry. The survey related to the important implementation of best practices in acquisition planning for software-intensive systems.

"The good news is that the preponderance of contributors to software failure are not technical in nature. This is in spite of the vast amount of hardware, software and communications technology employed in today's production control systems. Instead, the methodology surrounding acquisition planning and execution is the leading determinant," said Chantal Polsonetti, vice president with ARC Advisory Group and the lead analyst on this report.

Non-technical contributors to the problem include poor, incomplete or improperly managed requirements or planning, lack of user involvement, improper resource allocation, lack of executive support and a host of internal and external communications issues. Consequently, Polsonetti said manufacturers who focus their acquisition improvement efforts on technological factors alone, without regard to the acquisition process, are addressing only a small portion of the overall problem.

Manufacturers' command of the technical aspects of the machines they buy for making their product is dwindling Polsonetti added. While shrinking their corporate engineering staffs, they are increasingly relying on suppliers and outsourcing partners. Declining capital expenditure budgets and the power they can wield during negotiations are further eroding many manufacturers' ability to determine the specifications of incoming control systems.

Polsonetti said that implementing best practices in acquisition planning would help manufacturers avoid delays in new product startups for software-intensive systems and the associated TTM. In addition, attention to the acquisition process, with particular focus on acquisition planning, requirements management, documentation, and auditing and testing will go a long way toward ensuring that changes to plant floor systems for new products meet their original requirements and are online in time.