“Product Innovation and Product Lifecycle Management (PLM) Key to Profitable Growth, Reveals Aberdeen Group and Atos Consulting”

London, 16 November 2005

Manufacturers increasing revenue and decreasing product cost at double-digit rates, but confusion over PLM software selection and deployment remains

Research released by Atos Consulting, the business consulting arm of Atos Origin, and conducted by Aberdeen Group reveals that leading manufacturers are improving product profitability despite a harsh, rapidly changing product innovation environment.

Although product innovation has grown more complex, product lifecycles are decreasing, and manufacturers are competing in global markets with intense competition and supply chain challenges, companies are managing to achieve double-digit percentage improvements in the revenue, cost, and development costs of products.

Moreover, according to the benchmark research, best-in-class manufacturers have organisational structures designed to promote product innovation, and are four times more likely to employ PLM-related software capabilities.

Significant findings from the “Product Innovation Agenda Benchmark” report include:

  • Corporate strategies place significant emphasis on profitable growth, with 82% of corporate strategies placing a high level of emphasis on growing product revenue, while 93% maintain at least some strategic emphasis on reducing product cost.
  • Companies that have invested in product innovation have achieved an average of 19% increases in product revenue, 15% decreases in product cost, and 16% reductions in product development cost.
  • Tangible financial benefits can be derived from an array of PLM-related improvements, requiring companies to view product innovation goals in business terms as opposed to just operational metrics. Most enterprises, however, do not measure innovation KPIs with required frequency or enterprise-wide focus.

“Manufacturers are achieving operational improvements that yield significant bottom line results,” says Jim Brown, vice president of product innovation and engineering research at Aberdeen Group and author of the report. “But companies are still confused regarding which of a wide selection of possible PLM improvements will best help them profit from innovation.”

“It is encouraging to see product innovation being used as a means to profitable growth, says Adeeb Dhallai, partner, Atos Consulting. “Typically organisations focus their efforts on cost reduction and waste time on removing cost from a product or service that has been unnecessarily built in at an earlier stage in the development process. Leaders are clearly realising true value from implementing successful PLM processes by integrating suppliers and strategic procurement practices earlier in the development cycle.”

Product Lifecycle Management is one of Atos Consulting's second generation solutions that reflects our commitment to bring to market innovative, cross-sector solutions that build on our core competencies,” said Bernard Brown, senior vice president, Atos Consulting. We are able to help organisations become leaders in product innovation and realise significant value from managing the complete lifecycle process.

The report offers insight and analysis to help companies utilise PLM to develop innovative products and bring them to market profitably.

To obtain a complimentary copy of the report, follow this link:

About Atos Consulting
Atos Consulting, the global consulting practice of Atos Origin, is a leading provider of business, process and technology consulting services. With more than 2,500 staff globally, it focuses on delivering proven, pragmatic solutions to the telecom, manufacturing, financial services and public sectors.

Atos Origin is an international information technology services company. Its business is turning client vision into results through the application of consulting, systems integration and managed operations. The company's annual revenues are more than EUR 5 billion and it employs over 46,000 people in 40 countries. Atos Origin is the Worldwide Information Technology Partner for the Olympic Games and has a client base of international blue-chip companies across all sectors. Atos Origin is quoted on the Paris Eurolist Market and trades as Atos Origin.

About Aberdeen Group, Inc.
Aberdeen Group provides fact-based research and insights focused on the global, technology-driven value chain. Aberdeen's benchmarking, market and solution assessments, sales acceleration programs, and conferences support Global 5000 value chain and technology executives and the solution providers who serve them. For more information, visit www.aberdeen.com or call 617-723-7890.

Caroline Crouch
Atos Origin
Tel: +44 20 7830 4233
Email: caroline.crouch@atosorigin.com