PLM VS SCM: Which is Right for Your Business?
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Nobody said that decoding retail software terminology would be easy. Few retailers truly understand the difference between PLM and SCM. The reason for this goes far beyond similar sounding acronyms: The functions of traditional PLM (product lifecycle management) and SCM (supply chain management) solutions overlap, so it can be hard to define which functions fall under which umbrella term. The situation doesn’t lend itself to easy comprehension.
Shipping costs will remain abnormally high into the new year, driving inflation. Retail leaders need to understand industry terminology to make the right software decisions to mitigate the costs that they pass on to customers. That’s why, in this article, we’ll break down the functions of PLM and SCM solutions in layman’s terms. We’ll talk about what these tools traditionally do, where they overlap, key differences, and whether one can replace the other.
Let’s get into it.
What is supply chain management (SCM)?
So, what is supply chain management (SCM)? It’s one of the largest industries in the world. The global market for supply chain management solutions is predicted to reach $21.95 billion in 2023. Supply chain management is the process of tracking goods and services throughout your company’s supply chain. It refers to everything from transforming raw materials into a finished product, to your distribution and returns process. SCM is largely focused on production centers and warehouses where physical goods are made, and the people involved in producing those goods.
So what, then, is a supply chain manager? Supply chain managers oversee products throughout their lifecycle. This includes everything from converting raw materials into a finished product to communicating with stakeholders, from meeting production and safety requirements to managing warehouse and shipping budgets, and more.
A supply chain manager’s job requires them to have a comprehensive understanding of multiple branches of a business across multiple locations, all at once. No human without superpowers can do this all manually. Supply chain managers are leaning on integrated retail technologies for the overview and control they need to excel.
What is product lifecycle management (PLM)?
Next up is product lifecycle management (PLM). So, what is product lifecycle management? Product lifecycle management solutions traditionally focus on product development and the people involved in the product development process. PLM software helps retailers and suppliers determine what products they want to bring to market. Product lifecycle management offers transparency throughout the buying, designing, developing, sampling, and production phase of retail goods.
Most PLM software gives retailers and suppliers insights into their product lifecycle. However, for PLM solutions to help retail teams find product details and collaborate internally, they need to work in tandem with Product Information Management (PIM) and Customer Relationship Management (CRM) tools. A unified platform can help you identify the best partners, handle large amounts of product and collaboration data, and give you merchandising capabilities. Details such as where a product is in the production process, who did what throughout product development, how many iterations of a product exist, and more are housed in unified PLM and PIM tools.
Now, for the caveat. The retail industry requires buyers and sellers to get product images and data from external entities. Simple daily tasks like customizing quotes, posting on eCommerce sites, and finding image attachments can monopolize employee hours on the clock. Since most PLM software isn’t built to serve the retail industry, it lacks the integrated tools necessary to interface with external entities. This means that, despite having basic PLM software in place, most retail teams still use Excel documents, emails, image attachments, WhatsApp and text messages to collaborate. Only a Unified Product Collaboration Platform with the combined power of PLM, PIM, and CRM can give your team the ability to collaborate with internal and external stakeholders… right on the product images.
Where PLM and SCM overlap
They don’t just have similar acronyms, many of the functions of traditional PLM and SCM solutions mirror one another. PLM and SCM both focus on product development and distribution. They both provide a comprehensive overview of multiple business branches that enable more accurate reporting and decision making.
Both PLM and SCM are focused on the “who” of a retail operation –– they track which branch or individual completed tasks. They both provide a communication platform that teams can use to collaborate throughout the process. They even both track data throughout the production and distribution phases… but the similarities end there.
Key differences between PLM and SCM
Now let’s get into the nitty gritty. PLM is focused on product development; SCM is focused on the manufacturing process. In the retail industry, PLM answers the questions of “What” and “Who”: What does a team want to bring to market and who are the best partners to help them do that? PLM gives an overview of the buying, designing, developing, sampling, and production processes of an organization, and the people who fulfill those tasks. PLMs are traditionally focused on the product development functions that take place in-house: sourcing raw materials, product design and development, etc. Most PLMs are internal-only tools –– they’re built to help teams communicate with one another about products. However, to facilitate product lifecycle management in the retail industry, teams also need the ability to interface with external stakeholders.
SCM, on the other hand, answers the questions of “Who” and “How”: Who is fulfilling a manufacturing, testing, shipping, landing, or distribution task; and how is that product being produced, packed, shipped, tested, landed, or distributed? Supply chain management is a large umbrella term that encompasses specific software solutions that specialize in manufacturing, shipping/packing, shipping/freight forwarding, logistics and distribution.
Can PLM replace SCM, or vice versa?
While a complete supply chain management solution is actually comprised of multiple solutions that are overseen by a supply chain manager, product lifecycle management can be housed within a singular, Unified Product Collaboration Platform. PLM tools have evolved significantly. As part of a unified collaboration platform, retail software can now oversee not only product development, but also the shipping, sales, listing, distribution and returns process. A Unified Product Collaboration Platform can replace most existing SCM solutions, providing suppliers and retailers with 10x ROI on their software investment.
You don’t want your data to be siloed. Your company’s CRM, PIM and PLM solutions shouldn’t operate in a vacuum, either. Surefront is a Unified Product Collaboration Platform to power growth and ROI. Our patented PIM, CRM, and PLM solutions streamline the omni channel sales, merchandising and product development processes. By combining these essential functionalities, Surefront creates a single source of truth throughout your product lifecycle, sales and listing processes.
The results? Up to 150% more revenue per employee and a 40% shorter product development cycle is just the beginning. Try our 10x ROI calculator to see your company’s potential profits. Or, skip the noise and book a custom demo with one of our unified product collaboration management experts today. The retail industry evolves quickly and has a lot of moving parts. We do all of the research, so you don’t have to. Stay ahead of market fluctuations, trends and new features by subscribing to our Unified Product Collaboration Management Blog.
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