Not Your Father’s PLM: What Problems Modern Digital PLM Can Solve That Traditional PLM Cannot

Back in the early days of PDM development, the primary focus was on organizing and managing CAD files. Engineers struggled with file versions, storage, and access control, and early PLM systems evolved primarily to address these challenges. However, fast forward to today, engineering companies are dealing with an entirely different landscape—characterized by extreme complexity, global supply chains, reliance on contractors and suppliers, and extended product lifecycles.

Modern manufacturing and product development processes are driven by data and not CAD files, requiring new solutions to address challenges beyond just file management. As highlighted in 3 Key Challenges in Product Data Efficiency and Decision-Making for Manufacturing and Product Development, companies now face challenges that extend far beyond CAD file management. What is clear is that today’s problems demand more than what traditional PLM solutions were designed to handle.

New Challenges, Old Solutions – Why It Doesn’t Work

While CAD file management remains a necessary component of PLM, the scope of modern engineering and product development requires much more. The reality is that teams and companies are struggling with data—a vast and messy ecosystem of product-related information that spans engineering, manufacturing, procurement, and supply chain management. 

Data is located everywhere. Each design team collects and manages various pieces of information, while procurement and production teams also manage diverse pieces of information about individual design elements as well as entire systems.

But when it comes to managing these various pieces of information, one of the most commonly used solutions today remains Excel. There’s a reason for its popularity: Traditional PLM systems are focused on engineering and fail to accommodate the real-world needs of business data. 

These traditional systems were designed with a hierarchical, file driven approach to data management, often making them cumbersome and difficult to adapt to complex business needs. Instead these PLM systems uses the paradigm where CAD file management is a central data hub while providing sub-optimal solutions for everything else—such as BOM management, procurement workflows, or regulatory compliance, and others.

The data models in these systems are often too rigid, requiring extensive customization and forcing businesses to undergo major transformation efforts to fit within their constraints. Additionally, the user experience of traditional PLM systems has been a notorious barrier, driving users to resort to more flexible but inefficient alternatives like spreadsheets. Companies from very small to large enterprises are exporting data to Excel and various spreadsheets to solve problems of data management and control over the diverse set of business problems. 

How to Solve Real Problems?

The old legacy PLM strategy was built around the concept of a single source of truth (SSOT). While ensuring data integrity is important, the actual problems businesses face today are more granular and require a better understanding of business objectives. 

Instead of focusing solely on data consolidation, companies should categorize their needs into business problems rather than consolidated file management. From our experience, there are three major group of problems every engineering and manufacturing team is facing:

1. Sales Penetrators – How to drive more revenue? This could be through better sales configurations, faster quoting, or improved product availability based on real-time supply chain data.
2. Cost Impact – How does the system help reduce cost? Early and efficient cost estimations, automated BOM validations, and supply chain optimizations are crucial here.
3. Risk Factors – How does the system help mitigate manufacturing risks? Examples of these risk mitigations include compliance tracking, regulatory validations, and supply chain visibility can prevent costly errors and delays.

A modern PLM should enable businesses to act faster by ensuring that data is trusted, accessible, and actionable. The key to solving these real-world problems lies in a system’s ability to enhance decision-making across the entire lifecycle, rather than simply storing data in a structured way.

However, the challenge is that solving these real business problems is not always directly impacted by the ability of companies to organize a single source of truth and put all files in a single database as a traditional PLM philosophy suggests. A ‘traditional’ let’s start from the files is not the first priority and a single source of truth is replaced by a single source of change where each design data management systems can manage their design (mechanical, electronics, software), but the entire product data set must be captured and analyzed. 

How to Differentiate Modern PLM from Legacy Tools

Many vendors will push their technology first, emphasizing their platforms, integrations, or scalability. However, to truly differentiate between a modern digital PLM and a legacy system, companies should evaluate the vendor’s business strategy and approach.

• Legacy PLM Vendors: If a vendor’s primary message revolves around being a PDM solution or focuses on creating a single source of truth, chances are they are relying on outdated paradigms. These tools may work for basic file management but are unlikely to provide significant business value.
• Modern PLM Vendors: The real differentiator is a focus on data-driven decision-making. Instead of just managing files, modern PLM solutions should help businesses optimize operations through real-time insights, automation, and analytics.

Some key capabilities of modern PLM include:

• Design to procurement workflows – Organizing order processes faster based on trusted and real-time data.
• Early cost estimation – Allowing businesses to assess cost impacts before making design decisions.
• Regulatory compliance validation – Ensuring BOMs meet industry regulations using automated checks across multiple data sources.

A modern PLM system that focuses on solving these business problems will provide a faster ROI and a significant impact on operations.

Conclusion

To truly understand whether a PLM system is modern or legacy, businesses must ask a simple question: What problem does this system solve? If the vendor is still stuck in the old paradigms of CAD file management (PDM) or single source of truth (PLM), then it’s likely not addressing today’s real business needs.

The shift in PLM is no longer about just managing data but leveraging it to drive sales, reduce costs, and mitigate risks. Companies that embrace modern, data-centric PLM will see tangible business improvements, while those that cling to outdated solutions will struggle to remain competitive.

By choosing a PLM that prioritizes actionable data over rigid structures, businesses can unlock new efficiencies and truly transform their product development processes.

Interested to learn more about how OpenBOM solves problems? REGISTER FOR FREE and check this out. 

Best, Oleg