Executive Summary

Product Lifecycle Management

In an increasingly complex and competitive global marketplace, enterprises are under constant pressure to innovate, streamline operations and bring products to market faster while maintaining high levels of quality in production cycles and compliance with any range of regulatory standards. Organizations must balance the demands of rapid product development with cost efficiency, regulatory adherence and the complications of supply chains to meet manufacturing cycles.

ISG Research defines product lifecycle management (PLM) as the business processes and applications that manage and operate existing product lifecycles and support the innovation in new ones. PLM enables enterprises to manage a product from its initial conception through design, production, operations and governance. PLM systems help facilitate the efficient management of products, allowing enterprises to maximize innovation, improve quality and reduce time to market. In this modern age of PLM, the need to support a range of innovation in 3D visualization and augmented reality must support carbon footprint and sustainability requirements.

The market demand for PLM software and its continuous improvement has never been more acute. As product complexity increases, with more intricate designs and shorter lifecycles, the challenge of managing product development efficiently becomes more formidable. Global competition and increasing customer expectations demand faster innovation cycles and higher quality standards. The need to conform to stringent regulatory requirements adds another layer of complexity that businesses must navigate.

PLM software addresses these challenges by providing a centralized repository for manufacturing and supply chain-related product information and documents. It breaks down information silos, enabling cross-functional teams to collaborate effectively. With PLM, the enterprise can streamline workflows, enhance decision-making and maintain a unified, up-to-date view of products and the underlying processes to the bill of materials (BOM) and sourcing.

The scope of PLM encompasses strategic areas, including management, design, production, operations and governance of products and supporting processes. Critically, at the core of PLM are the design processes that support product development, requirements management, specifications and configurator-to-image management. By managing information and integrating it across disparate systems and processes, PLM ensures a holistic approach to product development, from idea to end-of-life. Beyond production, operations around bill of materials, orders, product catalogue, supplier and vendor management as well as document management are critical parts of ensuring the effective management of the lifecycle of products.

In an era where customer-driven innovation is critical, PLM enables enterprises to align product development with market requirements. By harnessing collaborative tools and real-time data, companies can respond swiftly to changing customer needs and market dynamics. This agility not only helps in maintaining a competitive edge but also in fostering a culture of continuous improvement and innovation. The inherent flexibility of PLM systems allows businesses to scale operations and adapt to evolving technological and market demands.

As a result, PLM software has become an essential tool for enterprises across various industries, including automotive, aerospace, electronics, consumer goods and fashion. For example, in the automotive industry, PLM is used to manage intricate design, engineering and manufacturing processes, ensuring compliance with safety standards and continuous product innovation. In aerospace, PLM helps manage the complexity of aircraft design, regulatory compliance and reliability, all while controlling costs. This is why the focus of PLM for governance across quality management, audit and review, and support of regulatory compliance is integral to this software.

Given the breadth of PLM's capabilities, it is not surprising that the market for PLM software is both complex and dynamic. The growth of the Internet of Things (IoT), artificial intelligence (AI) and supporting analytics are spurring further advancements in PLM systems. Today's PLM solutions are more powerful, integrated and user-friendly than ever before, benefiting a growing set of users who need to interoperate with the software. They offer advanced analytics, cloud-based deployment options and mobile access, allowing for real-time data sharing and collaboration.

However, leveraging PLM to its full potential requires a strategic approach. It is imperative for businesses to understand not only the technology itself but also how it aligns with their specific needs and processes. This understanding is crucial for selecting the right PLM software and for implementing it effectively.

The concept of product lifecycle management has its roots in the engineering and manufacturing practices of the late 20th century. Initially, PLM was focused on product design and engineering data management. As industries grew more complex and global, the limitations of traditional product data management systems became apparent. Enterprises needed a more comprehensive approach to manage product information across the entire lifecycle, from design and development to manufacturing and maintenance.

Over the years, PLM has evolved significantly. The advent of the internet and digital technologies brought new opportunities for collaboration, information sharing and innovation. Integrated PLM systems emerged, connecting various aspects of product development and supply chain management. Modern PLM solutions now incorporate sophisticated features such as digital twins, predictive analytics and advanced simulation tools, reflecting the growing complexity and technological advancements in product development. The need to integrate carbon footprint and sustainability information is increasing to ensure internal operations comply with external reporting requirements.

By 2028, one-quarter of product information management (PIM) and product experience management (PXM) software providers will acquire or combine with product lifecycle management (PLM) to meet the needs of enterprises. 

In today's dynamic business environment, enterprises face a multitude of challenges that necessitate robust PLM solutions. Organizations must navigate rapid technological changes, increasing product complexity and market pressures to innovate and reduce costs. Consequently, modern enterprises need a PLM system that offers comprehensive capabilities to meet these demands.

First and foremost, organizations require PLM software that facilitates seamless collaboration among cross-functional teams. Product development often involves diverse groups, including design, engineering, manufacturing, marketing and support. Efficient collaboration and information sharing are essential for aligning efforts, reducing errors and expediting decision-making. PLM systems should provide a centralized platform for real-time data access and collaboration, enabling teams to work cohesively across geographic and departmental boundaries.

Another critical need for enterprises is flexibility and scalability in PLM solutions. As businesses grow and evolve, their PLM requirements may change. A PLM system must be adaptable to accommodate new processes, technologies and market conditions. Scalability is equally important, as enterprises should be able to scale their PLM solutions to match their operational needs, whether they are expanding product lines, entering new markets or integrating new technologies.

The ability to manage and safeguard vast amounts of data is another crucial aspect of PLM. Products today generate significant data throughout their lifecycle, including design files, manufacturing records, quality reports and customer feedback. PLM systems must efficiently organize and store this data, ensuring its accuracy, security and accessibility. Robust data management capabilities enable enterprises to leverage data-driven insights for informed decision-making and continuous improvement.

Compliance with industry standards and regulations is a non-negotiable requirement for many enterprises, especially those operating in highly regulated sectors such as aerospace, automotive, and medical devices. PLM software must offer features that simplify regulatory compliance, including audit trails, documentation control and change management. Ensuring compliance not only mitigates legal risks but also reinforces customer confidence in the enterprise's commitment to quality and safety.

Additionally, modern enterprises seek PLM solutions that enable innovation and speed to market. The competitive landscape demands rapid product development cycles and the ability to respond swiftly to market changes. PLM systems should support agile methodologies, streamline workflows and reduced time to market. By providing tools for ideation, simulation and prototyping, PLM software empowers enterprises to innovate continuously and bring new products to market faster.

For PLM software to be effective and truly meet the needs of enterprises, it must possess a set of critical attributes. These attributes ensure that PLM solutions facilitate collaboration, innovation, data management, compliance and adaptability.

Effective collaboration is paramount in product development. Successful PLM software should offer robust tools for real-time communication, data sharing and project management. Features such as collaborative workspaces, version control and integrated workflows enable cross-functional teams to work seamlessly, reducing bottlenecks and enhancing productivity. The ability to collaborate effectively accelerates decision-making and ensures alignment across all stages of product development.

Flexibility and scalability are key attributes that any successful PLM software must possess. Enterprises operate in ever-changing environments, and their PLM systems should be able to adapt to evolving needs. Whether introducing new products, adopting new manufacturing processes or integrating emerging technologies, PLM software should have the flexibility to accommodate these changes. It is critical that PLM software supports variability management as well as a range of product versions in the manufacturing or assembly processes. Scalability ensures that the PLM system can grow with the enterprise, accommodating increasing data volumes and expanding operations.

Robust data management capabilities are essential for any PLM solution to succeed. PLM software should efficiently handle the vast amounts of data generated throughout the product lifecycle. This includes organizing, storing and securing data, as well as ensuring its accessibility and accuracy. Advanced search functionalities, metadata management and data visualization tools enable users to find and interpret data quickly. Data integrity is crucial, as accurate and timely data is the foundation for informed decision-making.

Compliance features are critical for enterprises in regulated industries. Successful PLM software should include capabilities to manage compliance with industry standards and regulations. This includes features such as change management, audit trails and documentation control. Compliance and regulatory support should help ensure that all product development processes adhere to regulatory requirements, reducing the risk of legal issues and enhancing product quality and safety.

Lastly, user-friendliness and integration capabilities are vital for the success of PLM software. A user-friendly interface ensures that teams can adopt and use the PLM system effectively, minimizing the learning curve and maximizing productivity. Integration capabilities allow the PLM software to connect seamlessly with other enterprise systems, such as ERP, CRM and MES. Seamless integration ensures that data flows smoothly across all systems, enabling a unified view of product information and processes.

As enterprises navigate the complexities of product development, selecting the right PLM software is a strategic decision that can have far-reaching implications. A well-suited PLM solution empowers organizations to innovate, collaborate and manage data effectively, ensuring compliance and adaptability in a dynamic business environment. When evaluating PLM software providers, enterprises should consider attributes such as collaboration tools, flexibility, data management capabilities, compliance features, innovation support, user-friendliness and integration. PLM software should integrate closely with PIM and support the broader set of requirements from customer and commerce to supply chain and supplier systems.

By carefully assessing these factors and aligning their PLM strategy with business goals, enterprises can make informed decisions that drive success and maintain a competitive advantage. With the right PLM software, organizations can manage the entire product lifecycle efficiently and cost-effectively, positioning themselves for sustained growth and innovation.

The ISG Buyers Guide™ for Product Lifecycle Management evaluates software providers and products in key areas based on analyst and administrative specific support, catalogue management support, content management infrastructure support, alignment to benefits, data management infrastructure support, digital asset management support, digital innovation, enterprise support, integration specific support, industry standard support, management and manager specific support, PLM application support, product lifecycle support, product manager support, product specific management support, supplier support and investment.

This research evaluates the following software providers that offer products that address key elements of PLM as we define it: Aras, Arena, Bamboo Rose, CentricSoftware, CONTACT Software, Dassault Systems, Epicor, IBM, Infor, Logility, Oracle, Propel Software, PTC, Revalize, SAP and Siemens.

Buyers Guide Overview

For over two decades, ISG Research has conducted market research in a spectrum of areas across business applications, tools and technologies. We have designed the Buyers Guide to provide a balanced perspective of software providers and products that is rooted in an understanding of the business requirements in any enterprise. Utilization of our research methodology and decades of experience enables our Buyers Guide to be an effective method to assess and select software providers and products. The findings of this research undertaking contribute to our comprehensive approach to rating software providers in a manner that is based on the assessments completed by an enterprise.

The ISG Buyers Guide™ for Product Lifecycle Management is the distillation of over a year of market and product research efforts. It is an assessment of how well software providers’ offerings address enterprises’ requirements for product lifecycle management software. The index is structured to support a request for information (RFI) that could be used in the request for proposal (RFP) process by incorporating all criteria needed to evaluate, select, utilize and maintain relationships with software providers. An effective product and customer experience with a provider can ensure the best long-term relationship and value achieved from a resource and financial investment.

In this Buyers Guide, ISG Research evaluates the software in seven key categories that are weighted to reflect buyers’ needs based on our expertise and research. Five are product-experience related: Adaptability, Capability, Manageability, Reliability, and Usability. In addition, we consider two customer-experience categories: Validation, and Total Cost of Ownership/Return on Investment (TCO/ROI). To assess functionality, one of the components of Capability, we applied the ISG Research Value Index methodology and blueprint, which links the personas and processes for PIM to a manufacturing enterprise’s requirements.

The structure of the research reflects our understanding that the effective evaluation of software providers and products involves far more than just examining product features, potential revenue or customers generated from a provider’s marketing and sales efforts. We believe it is important to take a comprehensive, research-based approach, since making the wrong choice of manufacturing-related PIM technology can raise the total cost of ownership, lower the return on investment and hamper an enterprise’s ability to reach its full performance potential. In addition, this approach can reduce the project’s development and deployment time and eliminate the risk of relying on a short list of software providers that does not represent a best fit for your enterprise.

ISG Research believes that an objective review of software providers and products is a critical business strategy for the adoption and implementation of manufacturing-related PIM software and applications. An enterprise’s review should include a thorough analysis of both what is possible and what is relevant. We urge manufacturing enterprises to do a thorough job of evaluating PIM systems and tools and offer this Buyers Guide as both the results of our in-depth analysis of these providers and as an evaluation methodology. 

How To Use This Buyers Guide

Evaluating Software Providers: The Process

We recommend using the Buyers Guide to assess and evaluate new or existing software providers for your enterprise. The market research can be used as an evaluation framework to establish a formal request for information from providers on products and customer experience and will shorten the cycle time when creating an RFI. The steps listed below provide a process that can facilitate best possible outcomes.

1. Define the business case and goals.
   Define the mission and business case for investment and the expected outcomes from your organizational and technology efforts. 
2. Specify the business needs.
   Defining the business requirements helps identify what specific capabilities are required with respect to people, processes, information and technology.
3. Assess the required roles and responsibilities.
   Identify the individuals required for success at every level of the organization from executives to front line workers and determine the needs of each. 
4. Outline the project’s critical path.
   What needs to be done, in what order and who will do it? This outline should make clear the prior dependencies at each step of the project plan. 
5. Ascertain the technology approach.
Determine the business and technology approach that most closely aligns to your organization’s requirements. 
6. Establish technology vendor evaluation criteria.
Utilize the product experience: Adaptability, Capability, Manageability, Reliability and Usability, and the customer experience in TCO/ROI and Validation. 
7. Evaluate and select the technology properly.
Weight the categories in the technology evaluation criteria to reflect your organization’s priorities to determine the short list of vendors and products.
8. Establish the business initiative team to start the project.
Identify who will lead the project and the members of the team needed to plan and execute it with timelines, priorities and resources. 
   
   

The Findings

All of the products we evaluated are feature-rich, but not all the capabilities offered by a software provider are equally valuable to types of workers or support everything needed to manage products on a continuous basis. Moreover, the existence of too many capabilities may be a negative factor for an enterprise if it introduces unnecessary complexity. Nonetheless, you may decide that a larger number of features in the product is a plus, especially if some of them match your enterprise’s established practices or support an initiative that is driving the purchase of new software.

Factors beyond features and functions or software provider assessments may become a deciding factor. For example, an enterprise may face budget constraints such that the TCO evaluation can tip the balance to one provider or another. This is where the Value Index methodology and the appropriate category weighting can be applied to determine the best fit of software providers and products to your specific needs.

Overall Scoring of Software Providers Across Categories

The research finds SAP atop the list, followed by Oracle and Siemens. Companies that place in the top three of a category earn the designation of Leader. SAP has done so in seven of the seven categories; Oracle in six; Siemens in five; Dassault Systems in two; and Aras in one category.

The overall representation of the research below places the rating of the Product Experience and Customer Experience on the x and y axes, respectively, to provide a visual representation and classification of the software providers. Those providers whose Product Experience have a higher weighted performance to the axis in aggregate of the five product categories place farther to the right, while the performance and weighting for the two Customer Experience categories determines placement on the vertical axis. In short, software providers that place closer to the upper-right on this chart performed better than those closer to the lower-left.

The research places software providers into one of four overall categories: Assurance, Exemplary, Merit or Innovative. This representation classifies providers’ overall weighted performance.

Exemplary: The categorization and placement of software providers in Exemplary (upper right) represent those that performed the best in meeting the overall Product and Customer Experience requirements. The providers rated Exemplary are: Arena, Dassault Systems, IBM, Oracle, SAP and Siemens.

Innovative: The categorization and placement of software providers in Innovative (lower right) represent those that performed the best in meeting the overall Product Experience requirements but did not achieve the highest levels of requirements in Customer Experience. The providers rated Innovative are: CentricSoftware and PTC.

Assurance: The categorization and placement of software providers in Assurance (upper left) represent those that achieved the highest levels in the overall Customer Experience requirements but did not achieve the highest levels of Product Experience. The providers rated Assurance are: CONTACT Software and Infor.

Merit: The categorization of software providers in Merit (lower left) represents those that did not exceed the median of performance in Customer or Product Experience or surpass the threshold for the other three categories. The providers rated Merit are: Aras, Bamboo Rose, Epicor, Logility, Propel Software and Revalize.

We warn that close provider placement proximity should not be taken to imply that the packages evaluated are functionally identical or equally well suited for use by every enterprise or for a specific process. Although there is a high degree of commonality in how enterprises handle product lifecycle management, there are many idiosyncrasies and differences in how they do these functions that can make one software provider’s offering a better fit than another’s for a particular enterprise’s needs.

We advise enterprises to assess and evaluate software providers based on organizational requirements and use this research as a supplement to internal evaluation of a provider and products.

Product Experience

The process of researching products to address an enterprise’s needs should be comprehensive. Our Value Index methodology examines Product Experience and how it aligns with an enterprise’s lifecycle of onboarding, configuration, operations, usage and maintenance. Too often, software providers are not evaluated for the entirety of the product; instead, they are evaluated on market execution and vision of the future, which are flawed since they do not represent an enterprise’s requirements but how the provider operates. As more software providers orient to a complete product experience, evaluations will be more robust.

The research results in Product Experience are ranked at 80%, or four-fifths, of the overall rating using the specific underlying weighted category performance. Importance was placed on the categories as follows: Usability (10%), Capability (30%), Reliability (10%), Adaptability (10%) and Manageability (20%). This weighting impacted the resulting overall ratings in this research. SAP, Oracle and Siemens were designated Product Experience Leaders.

Customer Experience

The importance of a customer relationship with a software provider is essential to the actual success of the products and technology. The advancement of the Customer Experience and the entire lifecycle an enterprise has with its software provider is critical for ensuring satisfaction in working with that provider. Technology providers that have chief customer officers are more likely to have greater investments in the customer relationship and focus more on their success. These leaders also need to take responsibility for ensuring this commitment is made abundantly clear on the website and in the buying process and customer journey.

The research results in Customer Experience are ranked at 20%, or one-fifth, using the specific underlying weighted category performance as it relates to the framework of commitment and value to the software provider-customer relationship. The two evaluation categories are Validation (10%) and TCO/ROI (10%), which are weighted to represent their importance to the overall research.

The software providers that evaluated the highest overall in the aggregated and weighted Customer Experience categories are Oracle, SAP and Siemens. These category Leaders best communicate commitment and dedication to customer needs.

Software providers that did not perform well in this category were unable to provide sufficient customer case studies to demonstrate success or articulate their commitment to customer experience and an enterprise’s journey. The selection of a software provider means a continuous investment by the enterprise, so a holistic evaluation must include examination of how they support their customer experience.

Appendix: Software Provider Inclusion

For inclusion in the ISG Buyers Guide™ for Product Lifecycle Management in 2025, a software provider must be in good standing financially and ethically, have at least $25 million in annual or projected revenue verified using independent sources, sell products and provide support on at least two continents, and have at least 50 customers. The principal source of the relevant business unit’s revenue must be software-related, and there must have been at least one major software release in the last 12 months.

The ISG Buyers Guide™ for Product Lifecycle Management evaluates software providers and products in key areas based on analyst and administrative specific support, catalogue management support, content management infrastructure support, alignment to benefits, data management infrastructure support, digital asset management support, digital innovation, enterprise support, integration specific support, industry standard support, management and manager specific support, PLM application support, product lifecycle support, product manager support, product specific management support, supplier support and investment.

The research is designed to be independent of the specifics of software provider packaging and pricing. To represent the real-world environment in which businesses operate, we include providers that offer suites or packages of products that may include relevant individual modules or applications. If a software provider is actively marketing, selling and developing a product for the general market and it is reflected on the provider’s website that the product is within the scope of the research, that provider is automatically evaluated for inclusion.

All software providers that offer relevant product lifecycle management products and meet the inclusion requirements were invited to participate in the evaluation process at no cost to them.

Software providers that meet our inclusion criteria but did not completely participate in our Buyers Guide were assessed solely on publicly available information. As this could have a significant impact on classification and ratings, we recommend additional scrutiny when evaluating those providers.

Products Evaluated

Providers of Promise

We did not include software providers that, as a result of our research and analysis, did not satisfy the criteria for inclusion in this Buyers Guide. These are listed below as “Providers of Promise.”