PLM for Process Manufacturers Provides a Competitive Edge in Global Markets

Gartner defines the PLM software as "a coherent suite of applications organized in a framework that supports the processes necessary to create, evolve and support product families from idea through retirement." PLM software evolved from a common infrastructure for product development to an infrastructure that aligns product development with the rest of a product value chain, extending support to nontraditional disciplines, such as sales, marketing, service, production, engineering, sourcing and senior leadership teams that own the product strategy. PLM allows organizations to monitor and analyze performance of life cycle activities and to field results to support critical product-related decisions, such as determining whether to add new features, to kill product initiatives, to introduce new products, to retire old products or to resolve problems and bottlenecks that hamper product-related business performance.

Figure 1 summarizes the key elements of a PLM infrastructure. The 11 classes of applications highlighted as "PLM Foundation" are necessary across all manufacturers, regardless of whether their manufacturing operations are discrete or process-centric. The classes of applications categorized as process manufacturing specifically address the design-through-manufacturing needs of product formulation and manufacturing engineering. Those applications under the discrete manufacturing category are useful to process manufacturers concerned about packaging. The integrated environment gives those manufacturers greater flexibility to modify packaging design, including labeling and artwork, as market demands and formulations change.

PLM foundation applications include:

Product team collaboration and PLM infrastructure — This IT infrastructure provides the ability to share disparate types of data across PLM applications and other enterprise applications. Users can also display, annotate and modify product content via the Web. It provides diverse and customized views of content, according to objectives, and it supports simultaneous or asynchronous collaboration.
Product innovation framework — This is software that supports user needs to identify and evaluate ideas or solve challenging engineering problems. It also helps companies identify potential risks associated with innovations, so that they can make better decisions regarding whether to embrace or reject innovation opportunities.
PLM-integrated sourcing — Manufacturers employ such software to coordinate supplier selection, material/equipment selection and procurement. It provides engineering with visibility to preferred suppliers and enables procurement organizations to benefit from economies of scale when purchasing in volume.
Archiving/vaulting — This is software that enables users to search and access information about items used to define and produce a product. Typical purposes might relate to R&D, manufacturing and purchasing or inventory management needs.
Regulatory compliance — Regulatory compliance software modules address adherence to 21 Code of Federal Regulations (CFR Part 11) for electronic signatures and new legislation meant to address the level of toxic materials, allergens and so on that are incorporated into products. The software identifies risks of noncompliance.
Product analytics — This is software that analyzes service reports, product returns, warranties and customer feedback to evaluate product defects and identify opportunities for product improvements. It can also provide real-time diagnostics for proactive service and maintenance.
Manufacturing process management — This entails an infrastructure for integrating software for manufacturing process design, validating the manufacturing processes and then improving them. It interfaces with design software as input to determine the processes. It interfaces with ERP and manufacturing execution system software to assess production constraints and to export proposed manufacturing plans.
Product structure/document structure configuration management — This class of software provides rules for configuring products based on engineering and manufacturing knowledge and documents, according to their intended structure and use. It also selects parts for products that may be used in products and creates a precise bill-of-materials input to ERP software. Best-of-class capabilities link the content within sections of compound documents to content in product configurations and maintain the documents under configuration control.
Product requirements/cost management — This involves processes supported by software to ensure that product design and the manufacturing process reflect a product's function, performance and cost objectives. The software provides visibility to performance, cost, manufacturability, service and disposal requirements.
Product program management — This involves the process of defining stages and milestones of a product life cycle. It applies to products and product platforms. It defines the schedules, budgets, resources and goals to deliver a product. It also incorporates project management functions natively or through integration with third-party software.
Product portfolio management — This involves the continuous cultivation of a product set by systematically allocating and guiding resources to product life cycle support, based on the requirements for growing the company. Product portfolio management (PPM) includes dashboards with executive views of decision variables, such as risk, opportunity, resource allocation, investments, product-revenue performance and customer acceptance.

Classes of applications specific to process manufacturers include:

Label/artwork management — This software capability allows manufacturers to ensure that content reflected in labeling conforms to what recipes and formulations include. As recipes and formulations change, the software streamlines the process of ensuring that labeling (for example, for ingredients and nutritional content) as well as advertising claims on artwork conforms to regulatory demands.
Process design and scale-up — This capability supports the design of manufacturing processes. Manufacturers also use it to validate that the processes are viable and can be scaled to full production.
Product modeling — This software enables manufacturers to do design of recipe- or formula-based products to react to intended physical characteristics, including color, flavor, texture, viscosity and customer benefit. Some pharmaceutical manufacturers and producers of personal care goods have interest in modeling formulas at the molecular level. Product modeling also involves simulations, which enable the ability to predict the outcome of chemical reactions or predict the target characteristics of products before committing to a formula.
Recipe/formula management — This includes functionality to create, capture, and reuse formulations and recipes from the earliest concept stages of product development through production. This includes flexible and dynamic change control to manage revisions and the ability to configure and track formulation variants. The capabilities should link manufacturing process steps to formulations, report nutritional content and ingredients for labeling, and minimally offer optimization based on mass and volume calculations.

Certain discrete manufacturing PLM-related applications are useful to process manufacturers to design and validate packaging. For example, food, beverage, and personal care manufacturers need to design packaging that is aesthetic and ergonomic to attract consumers. Yet, the packaging should have sufficient structural integrity to withstand the shocks and bumps of shipping without breakage. Also, a bill-of-materials (BOM) for the items that comprise product packaging is essentially the same as a BOM that any discrete manufacturer might use. Such packaging has the same configuration control and change control challenges that any discrete manufacturer faces. Therefore, process manufacturers will need functionality for packaging that discrete manufacturers prioritize.

The classes of applications that span these requirements include:

BOM-centric product change management — This includes support for approval processes, revision control and access privileges related to executing engineering changes to packaging and the associated bills of material. It should support publish/subscribe, state-based and formal structured workflow. Best-of-class software will enable persistent and nonpersistent, easy modifications to structured workflow. Manufacturers frequently use this capability to control design changes as design transitions into production.
Computer-aided design — Computer-aided design (CAD) includes tool design, and the aesthetics and ergonomics of packaging.
Computer-aided engineering — Computer-aided engineering (CAE) refers to software that process manufacturers can use to validate the structural integrity of packaging to minimize breakage during product shipping and storage. CAE can also be used to validate design of gates, runners and cooling lines in mold-injection equipment used to produce containers.
Computer-aided manufacturing — Software that automates the processes of generating machine tool path sequences of operations for fabricating molds and folding materials to make bottles and packaging.

Demand for PLM capabilities is well-validated. We see the largest manufacturers of formulation-based products driving the growth of PLM in process industries. Most of these are global manufacturers, serving multiple international markets. They are driven to invest, because most of their products are viewed as commodities under severe price pressure. Therefore, they must develop new products that command greater margins, while simultaneously reducing costs through greater efficiency, particularly for their flagship commodity products. They recognize that PLM enables them to manage recipes and formulations more efficiently, while simultaneously addressing regulatory issues and making supply chain collaboration more efficient in multiple markets.

Large business suite vendors, MES software vendors and large PLM software vendors will continue to improve their ability to serve PLM needs of process manufacturing companies. PLM vendors, such as Dassault Systemes, PTC and Siemens, all of which are well established in the discrete manufacturing space, are interested in this space, because it augments their established support for packaging and provides new avenues to grow business. Process PLM support is continuing to evolve as an increasingly important criterion, influencing larger and more-strategic software purchases.

Gartner has made a best effort to analyze the vendors from three perspectives: industries served, functionality supported and vendor-specific commentary. Figure 2 summarizes the presence of each of the 10 vendors in seven industry verticals highlighted in this report. Therefore, users should find those vendors that have the greatest presence and experience in their industry.

Figure 3 summarizes Gartner's assessment of 11 functional areas that our clients inquire about most. Our clients can use Figures 2 and 3 to evaluate the trade-offs between industry experience and functional capabilities. The Vendor Description section of this report provides profiles of each vendor, addressing background, software architecture, and details about overall business environment and maturity in this space. Profiles also highlight perceived strengths and cautions as well as recommendations.

We anticipate that this format will accelerate clients' understanding of the trade-offs across these vendors at a more granular level than either a Magic Quadrant or a MarketScope report. For example, a chemical manufacturer might quickly surmise that a vendor perceived to be strong in its industry with the right functionality might be viewed by senior executives as a viability risk. Or decision makers might prefer a small vendor with strong industry experience and deep domain expertise to get quick results, even if the vendor might be relatively vulnerable.

When manufacturers select PLM software vendors, they must understand a vendor's expertise in their industries to make better choices for candidate partners. Those vendors with the greatest industry familiarity usually deliver the fastest deployments with the least customization because previous experience with customers has cultivated knowledge of the software's functionality and workflow.

Gartner identified the 10 vendors most frequently cited in the market through inquiry and market intelligence that address seven industries. Each industry has a different complexion in the priorities that need to be addressed. For example, the pharmaceuticals industry has stringent requirements in compliance to 21 CFR Part 11, CAPA, and labeling regulations, while the chemical industry must conform to REACH to control chemical emissions and use of environmentally hazardous substances. Formulations measured by mass and volume may be important in the packaged food industry. However, personal care products and specialty chemicals may need to manage stoichiometry and other complexities of chemical reactions.

Figure 2 summarizes Gartner's understanding of vendor presence in process manufacturing industry verticals.

Process PLM is most mature in the packaged food and beverage industries, with most vendors providing strong presence and references in those industries. In other industries, small vendors have built deep expertise and have demonstrated strong ability to deliver value to large manufacturers quickly, despite their relatively small size. For example, large, well-known personal care goods manufacturers agree strongly that Enginuity PLM is best-in-class for enabling faster development of innovative new products. Likewise, flavors and fragrances manufacturers have strongly endorsed Selerant.

Also, despite their small size, companies like these have demonstrated an ability to survive in the face of much larger competitors. For example, Selerant was founded in 1990 while Enginuity PLM was founded in 1992, and both survived the high-tech bust of 2001. Both claim to remain consistently profitable. These are just two examples of small companies that CIOs at large manufacturers should not pass over simply because of their small size.

Just as vendors do not serve all manufacturing verticals equally well, they do not support all PLM functions equally well. These vendors have often built their reputation and companies from a single core competency and then expanded their portfolio of PLM capabilities. Figure 3 summarizes Gartner's assessment of the vendor's functional PLM capabilities.

From a functional perspective, recipe/formula management and label/artwork management are the two most mature classes of applications. The largest percentage of manufacturers say that they use these classes of functionality across all vendors. However, only a few vendors score well in creation of complex formulations to meet complex product requirements and regulatory needs. Enginuity PLM is the most functionally complete tool for such product modeling. Regulatory compliance reporting is also a key concern of process manufacturers. The three vendors with ERP roots, Infor, Oracle, and SAP, scored best, along with Selerant.

From a vendor perspective, Infor, Oracle, SAP and Siemens have the greatest functional breadth among the 10 vendors. Enginuity PLM, Oracle and Selerant had the most categories that were strongly endorsed by manufacturers, reflecting the greatest depth in vital functions.

Agentrics was created when GNX, which acquired its PLM assets from U.K.-based QSA in 2004, and World Wide Retail Exchange merged. This vendor is positioning its GenNovation PLM solution primarily for the retail private-label niche and packaged food manufacturers. The software won important technical benchmarks with Gartner food and beverage clients against much larger competitors. Agentrics offers its PLM product through annual Web-based subscriptions built on Microsoft technology.

Agentrics offers validated sourcing, procurement, global data synchronization, material traceability and demand chain management capabilities that complement PLM capabilities. Customers praised the software for its functionality and performance.
Agentrics PLM functionality is well validated for food retailers with a large number of stock-keeping units (SKUs), including a mix of private-label and named brands.
GenNovation offers strong specification management and workflow, particularly suited for development of retailer private-label packaged food products.

Although Agentrics has prepackaged integrations with Oracle (JD Edwards) and SAP, it typically does integration projects on a custom basis. Some customers cited integration with complementary applications as a capability that Agentrics needs to improve.
Agentrics is a relatively small vendor with strong technology that would be attractive to large ERP and PLM vendors seeking to win share in the PLM market for packaged food manufacturers and retailers.

Gartner views Agentrics as a strong candidate to support the retail supply chain for packaged foods and beverages on the merits of its software technology. We are cautious about recommending Agentrics PLM functionality for other industries.
Prospective buyers should evaluate their needs to integrate the Agentrics solutions with other enterprise software, including MES and ERP systems, and factor in any needed custom integration services when comparing price points between Agentrics and other PLM software providers.
Although we see Agentrics as more-vulnerable to possible acquisition than other PLM vendors, we encourage retailers and manufacturers to consider Agentrics. We believe that Agentrics has achieved a critical mass of customers that would continue to be supported with bug fixes and software enhancements, even in the aftermath of an acquisition.

While Aspen Technology has some strong engineering-centric PLM capabilities, we believe that its primary focus will remain process design and manufacturing rather than a broader PLM agenda. Aspen Technology works primarily in the continuous process industries and is focused on the design and optimization of the processes that will run in the plant. These designs are then handed off to detailed design tools from companies such as Intergraph and Bentley Systems.

Aspen Technology offers strong support for manufacturing process design, plant design, and production monitoring.
Aspen Technology's tools are based on a model-centric view of processes and products. The first principle models developed for process design are used throughout an enterprise to drive process improvements in existing plants. The focus is more on process efficiency and product quality than on the fundamental product chemistry.
Process models designed with Aspen Technology's applications help engineers design plans, including sizing, pricing and configurations for piping systems and specifications for equipment, such as pumps and heat exchangers. These core models help engineers scale process designs from "bench scale" laboratory pilot programs to full production.
Aspen Technology has a broad range of tools supporting the core competency of process modeling. This includes basic engineering support and economic evaluation based on standard data models.
This company also recognizes the opportunity for continuous improvement through integration of process design and manufacturing execution. Customers can leverage operations data to improve process models, enhancing their predictive capabilities. These strengths make Aspen Technology a strong complement to design software for the physical layout of a plant, particularly for such industries as oil and gas, petroleum, and chemicals.

Aspen Technology's offerings relate primarily to manufacturing engineering and management. The applications are not designed for R&D activities. For example, regulatory compliance relates to conformance of produced goods to specifications rather than the R&D function of assessing whether formulations meet regulatory guidelines. Therefore, Aspen Technology complements most of the vendors included in this study more than it competes with them.

Manufacturers should view Aspen Technology's applications as a complement to other classes of PLM software that focus on product definition, specification, and creation of formulations and recipes.
We recommend Aspen Technology for technical system buyers in its proven markets — primarily those with complex continuous-flow operations, such as petroleum and other types of raw materials refining. In these types of markets, Aspen Technology's advanced engineering support and simulation capabilities can avert mistakes and generate financial benefits that can justify the software expense and the extensive training and technical educational background needed to use the tools effectively.
Manufacturers in batch processing industries, such as packaged foods, beverages, personal care goods, pharmaceuticals and so on, should also consider Aspen Technology. However, because Gartner does not have the same degree of validation, we recommend that buyers demand site visits with reference customers in those industries before committing.

Conformia Software, founded in 2000, has established PLM domain expertise in the pharmaceuticals industry and has also been successful at establishing itself among producers of alcoholic beverages, notably wineries. This vendor has approached the market by building its Java-based applications for data visibility and detailed workflow that addresses the specific needs of its target industries. Since Conformia has been selling software applications for only one year, its customer base is still small. Conformia has aligned itself with SAP as a NetWeaver partner and to Documentum, complementing those larger vendors with functionality addressing product development through manufacturing process planning needs.

Deep expertise in the pharmaceuticals industry and among producers of alcoholic beverages. Early-adopter customers validate the increasing value of the software and its ongoing potential.
Demonstrations and briefings reflect comprehensive understanding of regulatory needs for its target industries.
Workflow reflects an integrative view of product development and its impact on manufacturing.
Strong data visibility across its applications and those of its partners such as SAP and Documentum.

Being a small vendor with strong intellectual capital, Conformia is more vulnerable to acquisition than others.
Adapting Conformia to manufacturing verticals that are adjacent to pharmaceuticals and alcoholic beverages is likely to involve additional cost of customization.

Pharmaceutical and alcoholic beverage manufacturers seeking PLM capabilities should evaluate Conformia.
Manufacturers in industries such as personal care products, with requirements that align with but don't exactly match Conformia's strengths, should consider Conformia with an eye to potential cost of customizing workflow to their needs.

Enginuity PLM was founded in 1992, primarily to serve manufacturers of personal care goods. Since 2002, this company's software has gained momentum with a growing number of companies that manufacture personal care products, pharmaceuticals and specialty chemicals. The bulk of the organization is dedicated to R&D, field services and support. Demonstrations and customer feedback indicate that the Java and XML base of the software is proving to be very flexible. Management positions the company for product developers in regulated industries, such as personal healthcare goods, pharmaceuticals, and packaged foods, with strong business drivers to innovate on large SKUs and short life cycles. Customer validation of the software has been strong.

The company has deep knowledge of requirements for designing and producing personal care products. Enginuity is executing well at leveraging that knowledge to expand into adjacent industries such as pharmaceuticals and specialty chemicals.
Enginuity ranks at the top for product modeling. The company received the highest praise for product modeling, among the customers we spoke to, across all vendors.
Customers report that the software is strong in its ability to manage complex formulations and regulatory demands.
The software demonstrates comprehensive capabilities at managing structured and unstructured data. Structured data might be variants of a common formulation to serve different markets. Unstructured data might be lab results for each of the variants, published as a document with a need to share globally.

Enginuity PLM is a small PLM vendor with deep domain expertise in specific industries. Therefore, we view Enginuity as a candidate for acquisition, though management assures Gartner that it wants to remain independent. But every company has its price.
While Gartner views Enginuity as at the leading edge of commercial technology for product modeling, customers report that the capabilities are not yet addressing their needs, as these capabilities are demanding to develop and demands for deep functionality seem insatiable.

Manufacturers in heavily regulated industries, such as personal care goods, over-the-counter medicines and pharmaceuticals, should consider Enginuity. Although Enginuity is a more-attractive potential acquisition than some other vendors in this study, we believe that some of the capabilities are unique, particularly for personal care products. Any potential buyer would most likely continue to support and evolve Enginuity PLM's capabilities.
Do not overestimate what can be accomplished with product modeling from Enginuity or from any other vendor over the short term. Clients that prioritize product modeling should prioritize Enginuity PLM as a candidate vendor but insist on clear documented communications when setting expectations for product modeling.

Infor acquired Formation Systems in the third quarter of 2005 to become a PLM provider addressing a broad range of process manufacturing industries through its Optiva software. The software is built 100% on .NET. Infor cites customers in industries spanning packaged food, beverages, personal care products, industrial chemicals and building maintenance products as referenceable.

The Infor PLM team has strong background and more than 10 years of experience in process industries. Infor claims support for a broad spectrum of PLM needs, including managing product requirements, costs, manufacturing process design, constraint-based product modeling (to identify formulations that conform to cost, performance, compliance and manufacturing targets), sourcing, analytics, regulatory compliance and program management.

Customers are positive about Infor's acquisition of Formation Systems, indicating that Infor ownership gives the Formation team greater business viability. However, feedback from customers and other independent sources suggest that, while Infor's ongoing investment in PLM is adequate for its customers' current needs, Infor appears to put less strategic focus on PLM than most of the other providers included in this study.

Customers we contacted validate the productivity of Infor's process PLM software for formula development and development version control.
Customers credit Optiva with a highly configurable open architecture and provide strong validation of the formula-recipe support for the research and development organization.
Customers validate strong global visibility of data.

In the past, customers reported that regulatory support is more comprehensive for North American customers than for the rest of the world. Infor addressed this through a partnership with Atrion, a software vendor that specializes in material compliance. While Infor claims that early adopters validated the value of this partnership, Gartner has not been able to confirm this independently.
Customer feedback suggests that software usability challenges and gaps in documentation are more challenging with Infor than with other vendors.

Manufacturers in packaged food and beverages industries should consider Infor.
Manufacturers interested in Infor should insist on a direct liaison with experienced technical experts who came from Formation, particularly if they are outside North America. Optiva benchmarks should include strong checks on regulatory support, given customer feedback that this report has been uneven depending on geography and industry focus.

Lascom, founded in 1989, develops PLM software called Advitium, which supports both process and discrete manufacturing within a common integral data architecture. The environment allows process steps to be interwoven with formulations. Also, items in BOM for packaging can be linked to items in process steps and the structure of formulations. Lascom supports product modeling, sourcing, regulatory compliance, program/project management and product portfolio management, and it has made its greatest impact in the packaged food industry. Customers in this industry confirmed the software's value for product data management, workflow modeling and product portfolio management.

All customers praised Lascom's software for its openness, configurability and customizability. All customers reported ease of incorporating custom workflow and trade rules without needing to customize Lascom source code.
All customers praised Lascom for the company's responsiveness and quality of support for product customization, rollout and support.
All customers reported strong value in the ability to organize and make visible formulation and related technical information across their enterprise and supply chain.
All customers reported the benefit of improved process setup and management when moving products from R&D into production.
Lascom has strong support for managing localizations or variants of base formulations with easy traceability.

Although Gartner believes that Lascom's architecture would enable support for global operations, the company may be challenged to support global manufacturing because of a lack of international presence and experience.
Although the software is highly configurable and customizable without disruption to end users, customers report that major software upgrades have been disruptive. They report that the upgrade processes are expensive and difficult.
According to customer feedback, Lascom, particularly the field organization, does not do enough to educate customers about the full range of capabilities and how to leverage them.
Lascom is among the vendors in this study we consider more likely to be acquired given its small size yet strong software infrastructure and comprehensive domain expertise.

European manufacturers and retailers, particularly in the food and beverage industries, should consider adopting Lascom.
Although Gartner believes that the software can scale to large international deployments, non-European manufacturers with international operations should be prepared to invest in Lascom's understanding and resources to support them.
Although Gartner is unaware of any vendor intending to acquire Lascom at this time, manufacturers planning to adopt Lascom's Advitium should plan for protection and contingencies in case Lascom gets acquired.

Oracle's PLM support for process manufacturers comes from Oracle's acquisition of Agile Software during 3Q07. Oracle Process Manufacturing (OPM) and E-Business Suite. A discussion of Agile's entry into process PLM provides a basis for explaining where Oracle will take the Agile platform. Agile Software purchased Prodika during the second quarter of 2006 to expand beyond its strong base in high tech and life sciences into the consumable goods industries (see "Agile to Buy Prodika to Serve CPG Manufacturers").

An investment in Prodika by H.J. Heinz before Agile's purchase infused substantial PLM capabilities for process manufacturers, making it a strong candidate for packaged consumable goods, including foods, beverages, personal care products and chemicals. Therefore, Agile brought a proven tool in formula/recipe management, regulatory compliance, specification management, material tracing and sourcing.

In addition to Agile's contributions, Oracle already had customers employing OPM for scaling and rounding of the ingredient quantities of the formula, entering manufacturing instructions, managing routings and quality control. Some Oracle customers also reported making headway at applying Oracle E-Business Suite in connection with managing a broad range of structured and unstructured data needed to support product development, manufacturing and regulatory compliance. However, the integration of Agile capabilities with the rest of Oracle's application suite is still a work in progress.

Agile Software brings strong PLM capabilities for process manufacturers and retailers with private-label brands, particularly for the food and beverage industries.
Oracle has been successful at acquiring and integrating companies such as PeopleSoft and Siebel into its operations. Related to PLM, Oracle was successful at transforming software from its 1996 acquisition of Datalogix into its well-respected Oracle Process Manufacturing software. Such experience at generating value from its acquisitions suggests that Oracle will generate value from its Agile acquisition as well. Manufacturers invested in Agile will be protected.
Oracle has complementary applications such as clinical trial and product information management that can be leveraged with PLM to make more compelling offerings in manufacturing verticals, such as pharmaceuticals and personal care consumer goods. Integration with clinical trials will streamline product development workflow for pharmaceutical companies (interested clients should also review "MarketScope for Life Science Clinical Study Automation and Management Applications, 2007"). Integration with Oracle's Product Information Management capabilities enhances opportunities for manufacturers to streamline collaboration with customers.
Given Oracle's strong track record, the acquisition of Agile Software promises a compelling software evolution path, bridging access to design data and proven workflow support for product development to a broader suite of back-office applications.

Customers have reported that Oracle's array of software applications is often bewildering. Adding Agile's applications may exacerbate the problem.
Although Oracle is responsive to customer requests, Agile customers express concern that service will degrade if Oracle replaces its current contacts with Oracle personnel. Oracle reports a decision not to replace current Agile customer contacts. However, if Oracle does make a change and the customer is not satisfied, he or she should be prepared to make that discomfort known quickly.
Integration of Agile's offerings to the Oracle infrastructure is still a work in progress.

Retailers with private-label brands and manufacturers in food and beverage industries should evaluate Oracle.
Manufacturers should evaluate Oracle's PLM capabilities primarily on the merits of software functionality and integration available within the applications that Agile made available. They should view integration with the rest of Oracle applications as a future direction, rather than as a criterion that will sway the software decision at this point.

SAP has a strong global manufacturing presence and has ongoing investment to continuously improve its formulation-based PLM. However, it needs further enhancement to support formulation development. SAP's PLM support for process manufacturers appeals to established SAP customers that want a common integrated system that will yield more-efficient business processes and better decision making. These customers also believe that adoption of SAP PLM as part of a broader SAP deployment simplifies IT management.

SAP presents a broad PLM vision that embraces financial, resource, process and technical implications of PLM. The recipe management capabilities, introduced in the third quarter of 2001, have been consistently improving during the past six years.

In this study, customers continue to report ongoing improvements. For example, SAP demonstrates increasingly sophisticated abilities to derive multiple recipes best suited for specific markets from single general recipes. For each of the site recipes, users have access to information about costs, suppliers, purchasing, manufacturing planning and manufacturing execution. The demonstrations highlight accessibility to environmental, health and safety implications, along with labeling support

Broad global ERP presence across many manufacturing verticals. SAP leverages its strong ERP base to promote its PLM offering.
CIOs promote SAP's PLM software because SAP bundles much of the PLM functionality into the core ERP offering. This endorsement by executives with ties to senior management gives SAP a selling advantage.
SAP's PLM vision with a strong focus on streamlining interdepartmental workflow appeals to senior management.
Integration with ERP functionality has potential to provide information consistency and can streamline design through manufacturing workflow during new product introduction plus service and support advantages during the active product life cycle.
Customer feedback suggests that SAP's formulation capability continues to improve. Ongoing progress will encourage existing SAP customers to adopt this offering.

Many Gartner clients and SAP references indicate that SAP's support organization responds quickly to user issues. However, the customer feedback also suggests to Gartner that it is more difficult to access knowledgeable PLM resources than with other PLM software providers. To alleviate this, our end-user contacts also contract services firms that specialize in SAP's PLM offerings.
Product features in SAP applications change from version to version. In Gartner's opinion, this complicates licensing and upgrade issues more than we see with other PLM software providers.
SAP continues to operate best as a system of record for released formulations. However, most manufacturers we speak with prefer specialty software to support the research and development needs.
While customers are giving SAP positive feedback on rate of enhancement, they give lower scores for bug fixing.