Three Steps to Reduce Complexity in Product Configurations

Customers want to know their options, and they won’t wait weeks for an answer

Published: Thursday, January 6, 2022 - 12:03

As customer demands for more customization and choice increase, the complexity of products and associated product design, manufacturing, and sales processes also increase. Product life cycles are also getting shorter, requiring a constant flow of new products with high-value features and capabilities.

This challenges product design and engineering processes to become leaner, faster, and more inclusive. Addressing and managing complexity is a key success factor. The challenge can be tackled using a three-pronged approach that includes increased collaboration, greater integration, and the use of a configuration life-cycle management system.

Integrating key IT systems

One of the most significant hindrances to companies today is their siloed systems. You might have a product life-cycle management (PLM) system in the engineering department, a customer relationship management (CRM) system on the sales side, and an enterprise resource planning (ERP) system on the manufacturing side. These different systems often don’t talk to one another.

A fundamental challenge is that all of these different functions must have a consistent view of the product they’re producing; they need to be aligned. But that doesn’t often happen. One of the fundamental challenges is to make sure that these different functions are all aligned and able to see what product options can be offered in different markets.

Bringing greater collaboration to the table

It’s not just that the systems need to be able to “talk” to one other from a technical standpoint. There’s also the matter of collaboration, particularly when it comes to issues about reducing time to market and getting the right information to customers. Time to market is the time from when an engineer has introduced a new feature or option into the product to the time when it’s available in the sales channel to be sold in the different markets. Organizations are looking to reduce this time, of course.

They are also looking to reduce time to quote. This is the time it takes to request a quote to receiving it, and that typically happens in the sales cycle. Because organizations don’t always have all the engineering knowledge captured, that turnaround cycle is often weeks. Customers will ask, “Can I have this and this and this combination?” And the salesperson will say, “I don’t know. I need to contact my back-office engineering technical guys.” And that’s for every iteration. The salesperson finally gets the information back, reports the price to the customer, who might respond it’s too expensive for them. So, then the salesperson asks, “Well, what about this combination?” And the cycle starts all over and takes an additional several more weeks.

These cycles would be shortened by greater collaboration, and the key to that is providing the cross-functional team with access to the data they need to collaborate. This requires greater integration between the IT systems used in each departmental function. The ability to share up-to-date and reliable data provides a single source of truth and solid basis for collaboration.

Configuration life-cycle management

Steps one and two, integration and collaboration, can be accomplished by step three: integrating a configuration life-cycle management system. This approach comes from a product configuration model in which every possible configuration option combination has been precalculated and verified. The data that fuel it come from IT systems such as a company’s PLM, ERP/MES, and CRM systems, and includes both product technical options and manufacturing, marketing, and sales options.

Product configuration options can run into millions of possibilities across all product lines, and the configuration life-cycle management solution can be used as a repository for all of them. Once that’s established, organizations can validate specific configuration options during design and manufacturing, define marketing campaigns and offerings, and most important, provide quotes to prospective customers.

Configuration life-cycle management, then, is a solution that’s purpose-built for managing product complexity. It enables greater collaboration and is thereby an enabler for addressing all associated complexity challenges. It gives manufacturers a powerful capability that doesn’t interfere with existing IT systems, business models, or product delivery processes. However, it can support all of these models and approaches. Therefore, configuration life-cycle management can be a powerful means for increasing efficiency and quality as well as a platform for transformation that can enable manufacturers to address complexity challenges both today and in the future.

Less complexity, more satisfaction

With greater possibility comes greater complexity. Today’s customers want to know what their options are, and they’re not used to waiting for weeks to get the answer. To be successful, organizations need to address and manage this complexity. Configuration life-cycle management, with its ability to foster greater collaboration across the enterprise, is an ideal partner for reducing complexity and increasing product life-cycle speed and customer satisfaction.

About The Author

Henrik Hulgaard

Henrik Hulgaard is the CTO and co-founder of Configit, the global leader in Configuration Lifecycle Management (CLM) solutions and a supplier of business-critical software for the configuration of complex products. He holds a doctorate in computer science from the University of Washington, is an associate professor of computer science, and has published more than 25 articles internationally.