Posted in Marketing and Strategy Terms, Total Reads: 473
Definition: Product Lifecycle Management
Product lifecycle management or PLM is the process in which the complete life cycle of a product is managed starting from its introduction to decline. PLM is important because the conditions in which a product is advertised, marketed or sold is different in different stages, hence the lifecycle of a product needs to be managed.
PLM helps in driving the success of a company through successful product development and contributing to the value of the business strategically. It also helps businesses in easily managing cross-functional processes and creating the best business products efficiently and consistently by coordinating the efforts of various teams. Product lifecycle management integrates people, processes, data, and business systems. This makes it possible for businesses to overcome engineering challenges and complexity of developing new products in different markets.
Benefits of using Product Lifecycle Management:
• Product introductions become successful, hence revenue increases
• Quality of the product is improved
• Time to market is drastically reduced
• Product cost and development cost are also reduced
• Wastage is reduced
• Potential sales opportunities can be quickly identified
• Effective management of seasonal fluctuations
• Better forecasting, so material costs are reduced
Limitations of the PLM model:
• It is difficult to decide which stage of the lifecycle a product is in accurately. For example, if a product has a rise in sales, it doesn’t mean it is in the growth stage and if a product’s sales are going down, it doesn’t meant it is in the decline stage
• Different products have different shapes of the product life cycle. The steep of the curve in the product life cycle model is different for various products. It may be steep in growth, short in maturity for one product, and short in growth and maturity, and steep in decline for another
• For some products , the duration of each stage is very unpredictable
These limitations make it difficult to apply the standard PLC models for product life cycle management. This can sometimes lead to wrong strategies if these limitations are not paid proper attention to.