Hello Everyone, Today I’m going to speak about how to set up a successful business transformation the implementation of a PLM platform. Carestream is a Medical Device manufacturer Innovation is key to all product development organizations, for medical device companies innovation speed must be balanced with ensuring the highest quality results for patients. A PLM system implemented properly with good business process development can allow companies to leverage global talent, unlock more innovation time and reduce the risks associated with decentralized resources. This presentation will address; Business Drivers that lead to a PLM Implementation A formula for establishing a successful PLM implementation effort Importance of ubiquitous world wide access to a PLM platform Results at Carestream to date Presented by David Sherburne , Director of Global R&D Effectiveness, Carestream Health, USA
Carestream is a global businesses that was divested from Eastman Kodak in 2007. We are 5 years old with a legacy of over 100 years in the medical imaging market. Carestream Health produces a wide variety of products for both Medical and Dental Imaging and Non- Destructive Testing.
We are a global company and have development and manufacturing sites world wide. Built from mergers and acquisitions so we have a wide variety of corporate and geographic cultures.
Rochester NY is not the SW capital of the world or where young engineers are attracted to, so we needed to find access to some talent globally. We desired a balanced cost structure and wanted to have an engineering presence in emerging markets. We also desired to leverage global manufacturing when costs became a major driver in mature product lines. As we globalized, the environment became more complex so we needed to address the non-standard local processes to be able to become more effective globally and better control information.
Demands on key knowledge workers are ever increasing. Tell a few stories Use analysis instead of build/test/fix/repair repeat Iterative methods like AGILE that span the globe need tools and process standardization to aid in collaboration. Difficult because best is “co-location”
PLM at its core is creating the standard method to control successively more detailed baselines as they evolve through the product lifecycle and providing support for change control. Design history baseline at each gate -DHF As designed baseline – DMR -EBOM As manufactured baseline –DMR- MBOM As built baseline - DHR – MBOM for device As serviced baseline – BOM as serviced Local processes evolve along with IT solutions and work well when people are co-located When groups begin to work globally then processes and IT solution disparities become more time consuming to manage This situation is critical to address when the business begin to expect that global sites will work together on projects or when the manufacturing base goes global or moves frequently to become more cost competitive.
This was the view of our systems when we first sat down and attempted to draw a representation of what systems we had across three of our major sites. This situation was caused by lack of a centralized team to work enterprise level architecture and drive standard thinking. Its also a product of the IT cost center mentality. Under investment and lack of strategic IT proliferates point solutions and little enterprise architecture considerations. IT can be a strategic partner and should be to enable the engineering business to be successful
Understanding your organization and how its supposed to work is the critical “tip on the arrow”. An unbalanced or unplanned approach to governance will lead to PLM failure at the enterprise level. Key is to understand the critical decisions for your PLM project and make sure that your Governance system can facilitate those critical decisions.
A good technology selection process takes time and a deep appreciation for what your business needs. So start early your partner selection is for at least 5 years and maybe 10!
Its good to follow a structured and methodical process to really understand the needs and then the information from suppliers of technology. PLM is a complex project.
Many models didn’t support the ROI we needed and front loaded our risk. During the process many license models were proposed and spreadsheets were given to us to help us predict costs. Some models were very difficult to understand and predict as they scaled globally and across processes areas and then users types. CSH is a medium sized business and not all of our revenue was associated with products that would be impacted by our PLM implementation, so some revenue based models were eliminated first. License models are an issue for the users across the industry because PLM tools need to allow for mass consumption of data and input to Engineering Change control and the license models can prevent that. Subscription based with a few breakpoints to allow for ramp up worked for Carestream. We have no limit to how many work flows we manage in PLM, no limit to global access or types of users. We can easily and accurately predict our cost structure.
High Level Process Diagram we use to explain where we are working Green is current effort areas and yellow is where we plan to move into next
PLM has many layers to pull apart and understand. Its important that the project team diagrams and analyzes each layer carefully and deliberately so that the project can be fully realized. Its critical that the various functional groups take the time to understand each others “layers” and work together to provide the best user experience possible.
PLM and ALM high level Applications Architecture Layer
Process Diagrams are the most valuable method for starting to collect requirements. A rule of thumb mentioned to me: You should spend 3x the time on requirements as you do on coding the solution. Otherwise you will spend that time fixing the solution over and over.
We took a risk on Aras 3 years ago and we are very satisfied with our decision to partner with Aras. Industry experts are starting to see Aras as a competitor for the mid sized business. Aras is a smaller company is refreshing to work with and aligned with our needs. Subscription model and open access is critical to scale and integration across the enterprise business eco system Community is growing, engaged and it has “attitude”
Its critical to understand how much process and requirements development can be handled by your on-site, full time, team members. Implementation partners will ramp up to fully develop all modules rapidly and don’t seem to be able to offer experienced process consultants that can map process and deliver requirements to feed developers properly. They can be a pair of developments hands but do not seem to be able to provide the insight into the business as deeply as they promised.
By collapsing the non-standard local processes into standard automated ones a properly implemented PLM system can provide knowledge workers with more time to spend on customer valued activities and innovation which is key to business success.
Global New Product CommercializationImprovementTopic : Product Lifecycle Management-Implementing Successful Transformational ChangeDavid G. Sherburne I am a PLM simple licenseDirector Global R&D Effectiveness model advocateand Engineering IT David G. Sherburne Carestream Health Inc. Page 1
Topic Outline- The PLM Journey• Snapshot of Carestream• Globalization –The forcing function• Insights for setting up a successful transformation• Carestream Case StudyTake- A – Ways•This presentation•When to consider a PLM system•How to form a PLM project and choose partners•Some benchmark data for estimation purposes•Opportunity to add some PLM friends to your network David G. Sherburne Carestream Health Inc. Page 2
Carestream Health – Who We AreAn independent company with a proventrack record and $2.5 billion in revenueA world leader in:• Medical imaging … digital and film• Healthcare information solutions• Dental imaging and dental practice management software• Non-destructive testing David G. Sherburne Carestream Health Inc. Page 3
Global R&D and ManufacturingA global company with Manufacturing and R&D locations aroundthe world Rochester, New York London, Oakdale, United Kingdom Minnesota Berlin, Germany White City, Shanghai, China Yokneam, Israel Oregon Baltimore, Maryland Windsor, Atlanta, Colorado Xiamen, Georgia China Ra’anana, Israel Guadalajara, Mexico Paris, France Toulouse, France Manufacturing R&D Both Manufacturing and R&D David G. Sherburne Carestream Health Inc. Page 4
The Business ChallengesGlobalization was required to meet our business needs• Desired access to talent• Needed a balanced cost structure• Desired a presence in emerging marketsImpact of globalization = more decentralized teams, more complexenvironment • Collaboration became more time consuming• Complexity in the organization increased• Knowledge-workers’ time was drained by managing complexity, impacting time spent on innovation• Productivity of new product development remained flat David G. Sherburne Carestream Health Inc. Page 5
Increasing Demands on Knowledge Workers • Project teams are less collocated • Platform development and globalization add to complexity • Iterative methods required faster information transfer • More stringent IP capture from suppliers is required to be flexible and to improve design for manufacturability • Access to historical data is needed to improve planning, compare reliability trends, and drive improvements to the development cycle • Engineers are required to do deeper analysis and model more • Requests for metrics are more frequent and are difficult to manually produce • Disjointed IT and non-standard process environments reduce effectiveness and increase demands on time Key Point -quality and compliance must be maintained so people manage the complexity with manual processes and spreadsheets impacting productivity David G. Sherburne Carestream Health Inc. Page 6
Evolution of Non- Standard Commercialization ProcessInnovativepeople innovatemany localprocesses to Gaps betweenassemble and blocks representbaseline inefficientinformation manual sharing of information ComplexityLocal increases asresources work begins tofocus on flow betweenworking local sites due toproduct families globalization 10/31/12 David G. Sherburne Carestream Health Inc. Page 7
Point Solutions worked but lacked proper architecture to enable globalproductivity Authoring Authoring PDM PDM PLM - -Enterprise PLM Enterprise No Confluence MCAD Tools Part No Teamcente Teamcente Integration MQDS Data Integration rr Excel NX NX No No SAP CAD Files PDF’s Integration Integration MS Pro/E Pro/E Project BOM No Integration No Integration Lotus Notes DB Team SolidWorks SolidWorks Intralinks Intralinks Room EQDS EQDS Sys 9K Sys 9K CAPA CAPA CAPA CAPA RoHS, RoHS, AutoCAD AutoCAD CAPA CAPA DoC, DoC, Electrical Part No No MSDS SOP SOP MSDS Data, RoHS Integration Integration (no (no File Shares File Shares DA DA home) ECAD Tools MMR home) MMR Mentor DX Mentor DX CIDx External EE File CIDx Lotus Domino No No Systems Cadence Cadence Shares, No Integration No Integration Integration Integration library cache Standalone OrCAD OrCAD DocManager DocManager Systems CAD Files PDFs CQuest Altium Altium Version Control Tools Information No No Software Integration Defects Defects Flow Clearcase Integration ClearQuestPoint Authoring Clearcase ClearQuest solutions are Desktop Tools Desktop Tools PVCS PVCS Subversion Subversion Enhancement Enhancementcaused by an “IT Cost Manual Requests Requests Integration (Browser, (Browser, StarTeam StarTeam Center” mentality and MSOffice, etc) MSOffice, etc) non- coordinated local DOORS Requirements DOORS Requirements Automated Quality Center Integration Management Toolsefforts Management Tools David G. Sherburne Carestream Health Inc. Page 8
Holistic PLM Approach- Its not just a simple arrow anymore1990s PLM was Today PLM must Peopletechnology improve Skilled in ; operationaldriven,supporting local Leading change performance management across anneeds Communication/training enterprise Project management Leadership Process Focus the organization Balanced - Structure vs Innovation Develop, inspire vision Standard across sites Technology Communicate strategy End to end Provided by solid partners Build awareness integration across functions Globally scalable Lead multi-cultural change Real time metrics Architectural orientation Continuous Solid IT infrastructure PLM must scale improvement Master data foundation to service a mindset global andPeople were co-located and distributedfocused environment David G. Sherburne Carestream Health Inc. Page 9
Leadership/ Governance the tip of the arrow CTO Office CIO OfficeAlignment with R&D Alignment with ITand Manufacturing • Ensure solution scalability•Central group to manage • Enable architectural alignmentthe effort that’s close to Director R&D • Improve on-going servicesthe business Effectiveness • Ensure leverage strengths of both•Ensured focus on the IT and businessbusiness David Sherburne•Gave focused time toprocess development andSME involvement•Provided a home for Vertical Businesscontinuous improvement Structure • Major stakeholdersWhat are the key • Home for subject matter expertsdecisions? • Key middle managersWho has the • Finance the work anddecision rights? reap the benefits David G. Sherburne Carestream Health Inc. Page 10
Technology and Partner Selection ProcessExamined our business objectives and the capabilities wewere lackingExamined market options for both the application platformand implementation servicesStarted the evaluation process early to learn partners’ depthand long-term partnership approachEmphasized building long term relationshipsContracted the implementation partner to help make the finaltechnology partner selectionUsed a rigorous evaluation process against high-levelfunctional AND businesses requirements that enabled astrong ROI for the Carestream business scenario David G. Sherburne Carestream Health Inc. Page 11
Partner Selection Model – Give Yourself Time Look for a strategic long termBusiness Objectives relationship (5 years minimum) Willingness to share in risk ID Capabilities Missing Flexible license/implementation terms in line with business ROI Write Key Use Cases Partnership during entire implementation lifecycle ROI of New Structure to keep on-going costs Capabilities in line with benefits Develop Business Requirements Strategies to Obtain Capabilities Final Selection of Partners Request for Information Request for Quote Time ~ 9 months 1½ FTEs David G. Sherburne Carestream Health Inc. Page 12
Benefits of the Partner Selection ProcessAllowed us to refine the requested information andexpectations over a period of three cycles with suppliersDrove internal understanding, maturity of estimates, andcosts through the first two cycles giving credibility to theproject with senior managersEliminated suppliers fairly and in stages, maximizing theunderstanding along the way of the finalistsCandidates remaining in the last cycle deeply understoodour functional requirements, business drivers, andexpectations and provided the best offers possibleProcess obtained the best balance of functionality, risk, andcost to our company, maximizing ROI and reducing risk David G. Sherburne Carestream Health Inc. Page 13
License Models Limited PLMs Business ValueModels Proposed Many License Models• Named User •Discouraged access to data• Module Based •Were costly to pilot and test• Creator/Consumer •Front loaded our cost and risk• Geographic Location Based •Were complex and difficult to predict the total cost• Enterprise – Based on Revenue •Limited platform scalability• Subscription – Based on Total Users •Placed crazy price tags on• Open Source – Free without support document management and simple• No Concurrent User Models Offered workflow management •Tanked the ROI License Models •Caused crazy behaviors to work Right People around license models Right Information Right System •Became a gift that would provide a Right Time rapidly growing revenue stream out of the company David G. Sherburne Carestream Health Inc. Page 14
Technology Architecture- Understand the Layers Understand the complete view of New Product Development “building blocks” and how to communicate them clearly Appreciate the complexity and interaction in the “Architectural Layers” Keep business process focus and balance between structure and flexibility Maintain good architectural orientation and familiarity with industry technology Mature the architectural maturity and understanding between the multiple functional organizations involved with PLM David G. Sherburne Carestream Health Inc. Page 15
High Level Process Architecture- Describe the blocksideas Portfolio – Dashboards, Metrics, Web Channels PLM – Product Life Cycle Management Platform SUPPORTABLE PRODUCTS SUPPORTABLE PRODUCTS Service Delivery, Pubs,Trainingideas PDM – Data ALM – Data Portfolio Management Project Management - Gates Management Management Product Planning Definition Quality Data Management Manufacture and Sustain for Hardware for Softwareideas Development Development WIP WIPideas Authoring Authoringideas Hardware Software Design CAD- Design –IDE ME,EE Integration of Applications and Core Master Data Strategy BOLD = Industry Term David G. Sherburne Carestream Health Inc. Page 16
Appreciate the Complexity in Each “Architectural Block” Need to drive understanding deep & across the functional groups to mature the enterprise understandingBusiness Process Maturity Presentation/Data Access Layer – Web Channel/Portals for internal and external Consumption; Dashboards, Business Intelligence Analysis, Supplier Portals Increasing Architectural Maturity Business Process Layer – Optimized Workflow and Roles and Responsibilities (Engineering Change Control, Production Release Process, Supplier Quote Process, Defect Management Process) Application Layer – Aras Innovator, Teamcenter, Doors, Rally, Subversion Data Layer –IT Maturity Master Data (System of Record/clean-up) , Attributes, Field Mapping to Metrics IT Infrastructure Layer – Global Networks, Servers, Databases, Storage, Back-Up, Archive Increase Organizational Maturity + Architectural Awareness = Success David G. Sherburne Carestream Health Inc. Page 17
Application Architecture Representation PDM Enterprise Systems Enterprise Systems Knowledge Sharing, Social Nets, Desktop Office, Office, HW and Webchannel Project Project Webchannel/ PLM -Aras Innovator PLM -Aras Innovator Dashboards – Social Closed Loop Engineering Change Closed Loop Engineering Change Metrics MCAD Tools Development PDM Upgrade Management (HW/SW) Management (HW/SW) Supplier 11 Supplier Event Tracking and Defect Mgmt Event Tracking and Defect Mgmt CAPA Management KMKM CAPA Management LN DBs Supplier 2 Audit Management Platform Platform Audit Management Supplier Access/ DFM Input Supplier Access/ DFM Input Supplier 33 Supplier Supplier Quote Supplier QuoteAuthoring Systems RQMTS ECAD, MCAD PDM Integrations ECAD, MCAD PDM Integrations Manufacturing Transfer Manufacturing Transfer New EBOM, MBOM Management New EBOM, MBOM Management Modeling Costing Raw Material Master SAP SAP Platform Costing Commercial Parts Library Commercial Parts Library ECAD Tools RoHAS RoHAS Purchase Purchase ECAD 1 Requirements Change Control Requirements Change Control Portals –– Portals ISDE Integration for SW events Integrated As Built Testing ISDE Integration for SW events ECoutlook ECoutlook Master Data ECAD 2 Smart source-Ebid Smart source-Ebid Quality Quality Platform Platform Established Established ECAD 3 (HPQC) (HPQC) Standard Standard Emerging Integrated SW Development Environment- SW Environment) SW Authoring Standard ISDE 2012 SW Project Management, SW Project Management, Build Tools and Services MS Visual Studio MS Visual Studio Core Proposal Dashboards Dashboards Test Scripting SW CM –– SW CM (Rally) (Rally) Some No Build Configuration XCODE, Other XCODE, Other SVN SVN Integration Standard Management Key IDEs Key IDEs End of Life David G. Sherburne Carestream Health Inc. Page 18
Business Process Architecture Swim Lanes Process diagrams ; must be organization independent provide visual scope drive deeper “use-case” discussions provide context to user story– for the “Role”, that desires to “do something in a process” the PLM system will “do something” refine functional requirement understanding concentrates people on future state and consistency vs. current state & holding on to it can be analyzed to reduce waste help focus training development on process and not button clicks help testing for validation on key workflows and performance David G. Sherburne Carestream Health Inc. Page 19
Understand Process Balance & Increase Productivity Manage for fast idea Manage for cycles repeatability and consistency Research and Manufacturing and Development RegulatoryKey: Carefully architect business processes with balanced SME input (MFG,RD,Quality,Regulatory) with consideration as to what point in the lifecycle data will be start to beentered into the PLM system David G. Sherburne Carestream Health Inc. Page 20
Process-Based TrainingTechnology and process are complex; skimping on trainingleads to inefficiency and slow adoptionTraining helps change the cultureTrain in the context of standard business process – notapplication “button clicks”Carefully identify the roles that require training and targetinformation to the rolesEvaluate self-paced training,it’s the hardest to deliver, butit’s most flexible for users David G. Sherburne Carestream Health Inc. Page 21
Properly Skilled Teams = Successful PLM Results Technology Partners Business Process & and Application Metrics Development Architecture Coding and IT Architecture, Configuration Master Data Skills for Migration implementation David G. Sherburne Carestream Health Inc. Page 22
Carestream Case Study• Open Source and Aras Innovator Platform• Scope and Scale of Phase One• Benchmark with Industry Expert• Findings Summary David G. Sherburne Carestream Health Inc. Page 23
“A”ras Innovator = “A”ttitude & “A”dvantages• Cost model allowed global scale that’s not tied to modules, geographic locations, or named users - key to ubiquitous internal and external access and enabling proper ROI• Flexible architecture supports rapid development – 50% easier than other platforms to configure• Upgrades… Guaranteed… when you subscribe• Open access to ALL data elements• Technical partnership – anti-virus performance, e-signature Help, visualization strategy, search functionality• Some risk (early adopter) but balanced with higher value• Community solution concept, which we are beginning to leverage• Single company provides the PLM Core – it’s not traditional “Open Source” David G. Sherburne Carestream Health Inc. Page 24
Case Study, Phase 1 – Implement a Global PLM that delivers: Global Standard Business ProcessesDefect Management Package Parts Mgmt.Overall Engineering Change-Mgmt-Closed Loop Commercial Parts Mgmt. Engineering Change Request (ECR) CAPA Mgmt. Engineering Change Notice (ECN) Deviation Authorization Audit Mgmt Engineering Change Implementation (ECI, MBOM) Supplier CollaborationDesign Parts Release Product/Team Mgmt.MBOM/EBOM Mgmt Feature Function Request Mgmt. Dropped from Phase 1 currently working nowAcross 4 Major Sites Uniting Many Point SolutionsRochester (DCS, HCIS) Closed loop Engineering Change (One Example)Oakdale (DO) Defects – ClearQuest (1300 users)Woodbridge (CMI) ECR – Spreadsheet, ManualShanghai (DCS, DO, CMI, Rayco) ECN – EQDS Retired (450 users) ECI – Spreadsheet Manual, SAP Integrated Requiring Involvement of ~75 Subject Matter ExpertsPLI Provides the Foundation for Carestream Health Inc. David G. Sherburne Future Process Standardization Page 25
Baseline Comparison with industry expert Key Points • Solutions for medical device companies take longer that average to implement, as more effort is required to meet regulatory requirements for verification and validation • Most PLM solutions typically require configuration/customization, as the OOB solutions do not fully meet the business needs • Aras architecture is impressive, flexible and modular, more cost effective and scalable, but may take more effort to implement than industry solutions but once implemented on going costs are minimal.User = Core engineering process worker that Industry Expert (Typical PLM) Carestream PLI- ARAScontributes to Part Creations, BOM management,Engineering ChangeSchedule (Implement & Deploy) 18-24 months 19 months deliver features 24 months stabilize and deploy most modulesInitial Implementation Cost $4000/user $3300/user(Core engineering users- measured inhundreds)License Maintenance/Subscription Cost $360/user $300>$165>*$75Functionality for a Phase 1 Engineering Change Closed-Loop Engineering Change Configuration/Revision Control Configuration/Revision Control BOM Management BOM Management Supplier Collaboration Deviation Authorization Product/Portfolio Management Product Defect Management Audit Management SAP Integration# of Sites for Deployment 3 4 Development SitesInternal Resources to coordinate (in addition to 5.5 FTE 5.5 FTEimplementation)Subject Matter Involvement 60 75 *When suppliers access the system >$75/user David G. Sherburne Carestream Health Inc. Page 26
Results to date for Carestream PLMDeployment was slower than anticipated - why up front license cost needs to be questioned! •Users of the system = 500 ramping up to 1000+ when defects fully deployed •Slow deployment of defect module due to software engineering metrics requirements •CAPA/Supplier portal/Requirements have been delayedTotal Engineering Changes Processed, over 1000 in first year Compared to prior solution baseline; •Number of changes has dropped 20% •Average cycle time for a change has dropped 30% •Rejections for content mistakes has increased 40%Current Support Staff – Year one of operation •Investments (choice) – New modules and enhancement functionality – 6.25 FTEs (Project Management, Development, Business Process, Testing) •Supplier Portal Development •Enhancements to current modules •CAPA (being re-evaluated) •Services (keep it running) – Support of users and defects fixes – 1 support FTE/100 Engineering Users (Project Management, Development, Testing) •Defects and bug fixes •User support, help tickets •Upgrade testing and release David G. Sherburne Carestream Health Inc. Page 27
Strategic Take AwayGlobalization without process standardization will lead to reducedinnovation time and flat productivityPLM Implementations require a holistic approach that includes; •Global Leadership = A Leadership Organization/Governance •People with change management/leadership skills •Processes mapping, standardization and development •Progressive and flexible technology partnersCost center IT mentality delivers proliferation of local pointsolutions and little enterprise architecture or process efficiencyPLM license models should be evaluated closely to reduce risk,allow ubiquitous access and enable the business ROI David G. Sherburne Carestream Health Inc. Page 28
Global Standard Commercialization Process (future) PLM Initiative PLM when successfully implemented will provide more time cut across 14 to knowledge workers to focus on innovative tasks that are processes truly valued by customersmany functionalareas & 4 sites Eliminated barriers to internal sharing of resources Improved enterprise collaboration effectiveness Enabled improved Metrics and Reporting Reduced organizational complexityStandard process set up a foundationfor continuous improvements 10/31/12 David G. Sherburne Carestream Health Inc. Page 29
Practical Take Away• Craft a balanced cross functional team• Prioritize project governance, know key decisions and set decision rights formally• Know your teams critical mass (how much work your team can handle) and match that with implementation partner’s speed and development capacity• Ensure business process work leads and use cases-requirements follow• Take work in small chunks (AGILE development methods works well)• Turn user interface prototypes early, fast, and review the implementation approach• Train in context of the business process not in the context of the tools button clicks• Get involvement of SMEs early and often. Cover all disciplines and phases of the lifecycle to ensure a balance between process structure and flexibility• Prioritize architecture and code reviews to ensure standards and avoid a poor code base due to rapid cycles/ turn over of developers• Verify and validate functionality using business-process diagrams as the basis• PLM will always take longer to deploy than estimated because of organizational change management• When automating manual integrations between point solutions multiply time estimates by 2 and spend the time to understand the business process David G. Sherburne Carestream Health Inc. Page 30
Willing to talk more about PLM…?PLM is a complex journey thatrequires discussion and;LeadershipStrategic technology approachSolid architecture at all levelsProcess focus and knowledgeHighly skilled teamLots -O- Benchmarking David G. Sherburne Carestream Health Inc. Page 31
Contact InformationDavid G. Sherburne – Director of Global R&D Effectivenessand Engineering IT, Carestream Health Inc.Linked in:http://www.linkedin.com/in/davidsherburnePersonal email: email@example.comWork email: firstname.lastname@example.orgSlide Share : http://www.slideshare.net/dgsherburneTwitter: @dgsherburne David G. Sherburne Carestream Health Inc. Page 32