Knowing your product lifecycle, from introduction to decline, is crucial because it guides you through the various stages of your product's journey in the market.
Understanding this cycle enables you to make informed decisions on marketing, pricing, and product development – and allows you to adapt your strategies to each phase to maximise profitability and longevity.
This article provides you with valuable insights into effective product lifecycle management, as we break down the product lifecycle stages to help you allocate resources efficiently and plan for future innovation.
What is product lifecycle management?
Product lifecycle management (PLM) is a strategic process that manages the entire journey of a product from inception to disposal. It covers the initial concept, development, product service, and end-of-life management for saleable goods.
PLM is essential for organisations that deal with complex products, requiring coordination across different departments and stages of product development.
Product lifecycle management systems integrate information, processes, and people from various functional areas to unify the product value chain with integrated business planning and supply chain execution.
Why product lifecycle management is important
PLM offers a multitude of benefits that can translate into significant business gains. One of its key advantages is its centralised, single source of information that ensures all departments within your organisation have access to up-to-date and consistent product data.
This central source of knowledge will reduce errors and inefficiencies and lead to shorter development cycles because the various functional teams can collaborate more effectively, speeding up the design and production processes.
PLM systems reduce your compliance risk, by helping you to navigate the complex regulatory environment more efficiently, ensuring that your products meet all necessary regulatory standards. They also simplify audits by managing documentation and processes in one place, ensuring your products adhere to regulations and quality standards to reach the market faster.
These benefits collectively contribute to greater productivity, reduced development cycles, improved business scalability and the ability to respond swiftly to market changes, ultimately leading to a competitive advantage.
Product lifecycle management and business growth
PLM helps reduce costs by leveraging existing designs and knowledge. The system drives innovation by facilitating feedback sharing across departments and enhancing product development.
PLM systems also allow for the reuse of design elements and can apply lessons learned from past projects, to avoid repetitive errors and reduce costly waste. This helps you develop new products more efficiently by integrating and automating business processes, shortening time-to-market, and improving overall product quality and procedures.
Enhanced product quality is achieved by providing real-time access to product data, which informs continuous improvement and innovation efforts.
How product lifecycle management works
PLM facilitates collaboration among cross-functional teams to ensure that all relevant information is accessible and up to date. This helps guide informed decision-making and reduce the overall cost of the product across its lifecycle.
By leveraging PLM, you can respond more quickly to market demands for more sustainable products and drive improved operational efficiency and innovation within your products.
Product lifecycle management typically involves 4 key phases:
- Product conception
- Design and manufacture
- Service and maintenance
- Disposal or recycling
Here’s how each of these aspects works in PLM.
1. Product conception
The critical phase in the product development lifecycle is the conception of a product where an idea is transformed into a detailed concept statement. This statement then serves as a blueprint for the product, outlining its purpose, target audience, unique selling points, and how it will fulfil specific consumer needs.
The concept statement is a strategic document that guides the development, marketing, and sales teams, ensuring everyone is aligned with the product's vision and goals. A well-crafted product concept can help secure stakeholder buy-in and provide a clear direction for your product's journey from idea to launch.
Comprehensive market research and product-market fit analyses are essential to ensure that the concept addresses real customer needs and stands out in the competitive landscape.
2. Design and manufacture
Product design and manufacture require technical expertise to turn the concept into a viable prototype, addressing the practicalities of design, materials, and functionality. Strategic planning navigates the product through testing, refinement, and compliance with industry standards to ensure a successful outcome.
Efficient manufacturing processes are necessary for production at scale while maintaining quality and cost-effectiveness. Each step is interdependent and requires a careful balance of creativity, precision, and foresight to bring a product from conception to reality.
3. Service and maintenance
Service and maintenance are crucial to the lifecycle of products, requiring effective management to ensure that your product remains functional, relevant, and desirable over time. Understanding and implementing robust product service and maintenance strategies can significantly impact your success and the longevity of your product in the market.
Product service management is a complex process that considers various aspects of sales, the product itself, and its target audience. It maintains the product's image, ensuring it is marketed to the right audience and meets customer demand.
Maintenance involves the day-to-day and long-term processes around the materials, equipment, and even the facilities that produce the product, which is essential for proactive and real-time response to supply chain issues.
When combined, these two strategies lower support costs and increase the effectiveness of marketing campaigns while also fostering consumer satisfaction, loyalty, and creativity.
4. Disposal or recycling
Proper product disposal helps to reduce landfill waste, while recycling transforms used items into new products, conserving energy, and resources.
As an example, Officeworks in Australia has set ambitious goals to recycle 17,000 tonnes of unwanted products by 2025, having already collected over 9,000 tonnes since 2015 through its Bring it Back program.
Initiatives like these are part of a larger movement towards a circular economy, where products are designed to be reused, repaired, or recycled, minimising waste and environmental impact.
The different product lifecycle stages
The four main product lifecycle stages are introduction, growth, maturity, and decline.
You must be strategic in managing each stage of the product lifecycle to maximise your product's success and longevity in the market.
Introduction is the launch of the product. This stage is characterised by slow sales growth as the product is being introduced to consumers for the first time. Rigorous marketing and promotional activities are undertaken at the introduction stage to inform potential customers about the new product, its features, and its benefits.
Growth sees an increase in consumer acceptance of the new product, sales, and market share increase. This stage is often accompanied by expanded distribution and an increase in marketing activities, as profits begin to rise.
Maturity is when the market becomes saturated. Increased competition sees sales growth slow and product differentiation is necessary to extend your product life keeping it profitable for longer.
Decline is marked by decreasing sales as innovations emerge or consumer behaviour and demand change. In the decline stage, sales drop, the product loses its market share and competition deteriorates. This potentially leads to the product being phased out or retired from the market unless you implement product expansion strategies to extend the product life.
Understanding these product lifecycle stages helps you plan your marketing, production, and R&D efforts to maximise profitability throughout the product lifecycle.
Common product lifecycle management challenges
Product lifecycle management is a complex process that faces numerous challenges.
In the concept phase, companies often encounter roadblocks in generating actionable ideas and overcoming bureaucratic hurdles. Establishing market viability is essential before development begins and requires thorough market research and analysis to ensure financial feasibility.
One primary issue is ensuring that you have efficient collaboration across various departments to create a unified product strategy. Another is managing the vast amount of data and information that comes with PLM, which needs a robust system to integrate and manage this data effectively.
Adapting to rapidly changing market demands and consumer trends is crucial for the success of a product, which can be a daunting task for product managers.
These challenges highlight the need for a strategic, well-coordinated approach to PLM and business intelligence tools to help overcome these obstacles and achieve a competitive advantage in the market.
Product lifecycle management tools and systems
Product lifecycle management tools are essential when looking to streamline your product development process, improve product quality, and reduce your time-to-market.
The PLM tools you choose will depend on the specific needs, size, and maturity of your business. These tools can be broadly put into three categories: PLM software, paper or spreadsheet-based systems, and Enterprise Resource Planning (ERP) software.
While PLM software offers a robust and integrated approach to managing the product lifecycle, paper/spreadsheet-based systems can serve as a stepping stone for smaller companies. ERP software with PLM capabilities can bridge the gap between product development and other business processes, creating a seamless flow of information across your organisation.
The effective use of these tools can lead to improved product quality, faster time-to-market, and better decision-making throughout the product lifecycle.
Product lifecycle management software
Product lifecycle management software is a critical tool for managing the complex processes associated with the creation, development, and ultimately, the disposal of a product. It’s indispensable to businesses that need to adapt quickly to market changes or to manage global supply chains.
PLM software will help you to align business processes on a single platform, giving you a digital foundation to streamline your product development and supply chain strategies. The software helps manage data from items, parts, products, documents, engineering change orders, and quality workflows.
One of the key benefits of PLM software is the ability to extend a product's life by identifying which stage of the product is lifecycle and devising strategies to boost its market presence and profitability.
Unleashed inventory management software exemplifies the benefits of PLM by offering features like real-time stock level updates, end-to-end supply chain visibility, and total product traceability. This can lead to reduced inventory storage and production costs, maximised cash flow, and prevention of stockouts.
Paper and spreadsheet-based PLM systems
Paper or spreadsheet-based systems, while more traditional, are still in use, especially by SMEs or those in the early stages of adopting PLM practices.
These manual methods involve the use of physical documents and electronic spreadsheets to track product data and changes. Although they are less efficient and more prone to errors than software solutions, they are also more accessible and can be easier to implement on a small scale.
ERP software for PLM
ERP software systems focus on the operational aspects of your business processes. While not exclusively a PLM tool, ERP systems often include PLM components or modules. They help in managing your day-to-day activities such as procurement, production, logistics, and financials.
Integrating PLM functions within an ERP system can provide a more holistic view of product lifecycle stages, ensuring that product data is consistent across all your business processes.
Best practices for improving product lifecycle management
Improving your PLM is crucial if you want to stay competitive and efficient.
Best practices for product lifecycle management include:
- Establishing clear objectives and goals for your PLM strategy, which ensures alignment with business outcomes.
- Regularly reviewing processes and data to help maintain relevance and accuracy in the PLM system.
- Obtain organisational and executive buy-in, as this fosters a culture that supports continuous improvement.
- Working from a detailed project plan with a dedicated project leader to streamline implementation and ensure accountability.
- Integrating technology and product lifecycle management software to gain real-time insights into product performance, further enhancing PLM.
By following these best practices, you can optimise your product lifecycles, resulting in reduced costs, faster time-to-market, and improved product quality and compliance.
