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Sustainability: The New PLM Opportunity

By May 18, 2022July 18th, 2023No Comments

While the environmental movement began some 60 years ago, we still find ourselves in a crisis of sustainability. While the term strictly means the ability to maintain or support a process over time, it has come to represent our growing environmental, economic, and societal efforts to sustain our current resources and way of life.

Three reports from CIMdata on sustainability outline the business case to be made for it, why PLM is important to sustainability efforts, and the inherent business opportunity. As they point out, growing consumer interest in sustainability’s three pillars—people, planet, and profit—is moving sustainability efforts from “nice to have” to a true competitive advantage. CIMdata notes newly elevated consumer interest in the topic, including 22% more consumers saying environmental responsibility is very or extremely important when choosing a brand than in 2019 and 62% now saying they’re willing to change purchasing behavior to help reduce the negative impact on the environment.

The pandemic has heightened awareness and attention to the issue, as well. Ninety-three percent of global consumers say COVID-19 affected their views on sustainability. And 79% of more than 1,100 CEOs surveyed by the UN Global Compact in 2021 reported that the pandemic highlighted the need to develop and implement more sustainable business models (CIMdata, 2022, The Sustainability Imperative).

The Role PLM Can Play

In making the case for the role PLM must play in sustainability efforts, CIMdata points out that a systemic response to the challenge has always been necessary—moreover, the effort requires an approach that takes into account people, process, and technology, along with the need to create “virtuous” cycles. PLM is perfectly positioned to step into that role, because its core functionality is helping define—or redefine—the built world and everything in it, as well as bringing together every role in the product lifecycle to participate in a common process. Sustainability, CIMdata says, is an existential challenge that we all need to succeed in together. It also offers significant business opportunities.

This is an “opportunity for PLM solution providers to provide templates for compliance and other sustainability-related protocols that make sustainability easy for customers in specific industries” (CIMdata, 2022, State of PLM).

Current State of the Industry: Sustainability Surveys

To determine the current and potential state of the PLM industry with respect to sustainability, CIMdata performed two surveys: one general and one focused on independent software vendors (ISVs) and system integrators (SIs).

Survey: The Industrial Perspective

The general survey garnered more than 200 responses, primarily from manager-level up to CxO positions related to the product lifecycle, in companies around the world, and serving a wide variety of industries. The purpose was to gain insight into why companies are making the effort to develop sustainability programs and how they’re going about it. But while some 95% of respondents see their own companies as either leaders or at least average in sustainability efforts for their industry, their responses to specific questions show significant opportunities for strategic and systemic support from outside sources.

The three sustainability motivators most commonly reported were centered on regulatory requirements, customer demand, and financial/investor demand. Other responses indicate that most often sustainability is a goal managed and handed down from C-level to business units, that only about 25% of companies have a clear, defined sustainability strategy and key performance indicators (KPIs), and that only 20% of companies report fully integrated sustainability resources in business units. Taken together, the responses reflect the lack of a consistent approach, commitment, and purpose throughout the company. PLM processes, strategy, and tools can help.

Survey: The ISV/SI Perspective

Based on 134 responses, the more focused survey represents a similar geographic distribution as the general survey. The split is approximately two-thirds ISVs and one-third SI, reseller, or value-added reseller (VAR). Nearly 75% reported being leaders in sustainability for their industry.

One focus of this survey was an evaluation of the importance to respondents and their customers of the United Nations Sustainable Development Goals (UN SDG), which offer a common basis for framing the sustainability discussion. More than 90% of ISVs and nearly 70% of SIs report UN SDGs as being critical to their strategy. That value is backed up by the fact that nearly 80% of respondents also say UN SDGs are critical to some or most of their customers.

Sustainability Conclusions

Perhaps the most interesting outcome of both sustainability surveys was the fact that PLM was rated the number one most essential technology for improving sustainability efforts across all respondents. Companies need to build solutions that address changing requirements and deliver product, all while meeting sustainability requirements. PLM solution providers are well positioned to help a wide variety of companies rise to those challenges.

For more detail on how PLM can support sustainability efforts across industries, see the complete CIMdata reports: “The Sustainability Imperative,” “Meeting Sustainability Objectives,” and “Enabling Sustainability in the PLM Economy.”

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