This article was originally published in our PLM Report 2023 – the definitive instalment in fashion’s longest-running dedicated PLM market analysis. To read other opinion pieces, exclusive editorials, and detailed profiles and interviews with key vendors, download the full PLM Report 2023 completely free of charge and ungated.
- The fashion industry is facing an interlocking grid of challenges, including climate change, sustainability legislation, supply chain risks, and an unpredictable market.
- PLM is a hub that connects people and digital solutions, and can be both a bedrock of stability and an enabler for wider digital transformation.
- Large enterprises are continuing to expand their PLM footprints, while smaller and micro-brands prioritize affordable, SaaS software as a key engine for their growth.
- With sustainability regulations being introduced and enforced, demands and expectations for PLM are destined to change, and PLM may need to become a sustainability and transparency solution by itself.
PLM has had a lot of labels over the years. The ones that have stuck the longest have been those that put the software and the idea where it belongs: at the centre of everything. The longest-serving of them is probably “single source of truth,” but I prefer “the heart of product design and development,” because it reflects the fact that PLM isn’t just a home for knowledge and process centralisation, but also a hub for connecting both people and a diaspora of different digital solutions.
But being the heart of anything can be a complicated prospect.
When things are going well, you sort of fade into the background. Sitting here, reading this, you probably weren’t aware of your own heartbeat until I just brought it up. Because that’s what hearts generally do: keep on going, quietly and steadily.
When things are going badly, suddenly all eyes are on you. Because when the organism is threatened by change, or when parts of it are injured, it’s the heart’s job to make sure the host survives.
And if we look at fashion from that perspective – as an entity besieged on all sides by threats, and with damage to its extremities up and downstream – then its heart should be working overtime right now.
In theory, this should translate into a universal upsurge of interest in PLM from organisations that haven’t yet adopted it, or that are looking to replace a legacy solution. In practice, I don’t believe that’s happened in quite that form, since new-name PLM sales remain buoyant but haven’t completely exploded.
But based on the data we collected this year, some related things have happened that hint that a greater weight of expectation is being placed on PLM as the outer world is becoming more hostile and difficult for brands, retailers, and producers.
Large enterprises that were among the earliest investors in PLM are continuing to expand their PLM footprints, acquiring new licences (often in huge numbers) and purchasing new modules and features to both capitalise on new opportunities and to mitigate the impact of big challenges.
And PLM for smaller and micro-brands continues to be one of the most active sectors – with brands across the SME market segment continuing to prioritise affordable, SaaS software as a key engine for their growth. Critically, this trend is continuing at a time when a lot of investment is focused on peripheral and extended solutions – DPC, eCommerce and so on – that promise capabilities that are more exciting, more immediate, and more current than PLM.
So brand and retail businesses at the both extremes of the size and complexity spectrum are evidently still finding value in the long-standing idea of consolidating core product information, connecting systems, and unlocking collaboration.
And at a time of historic disruption, brands are not just turning to new ideas and quick fixes; they’re building new or deeper relationships with foundational technology precisely because of those disruptions.
What are the disruptions I’ve hinted at? They’re all things we’re intimately familiar with. Spiralling input costs. Long lifecycles. Shrinking trend windows. Fractured supply chains. Overproduction and excess inventory.
But the largest of them, to my mind, is sustainability. That’s not a small claim at a time when we’ve seen a devastating pandemic and a catastrophic war in Europe in the last three years alone, but I think it’s an accurate one.
First let’s consider the pace. It’s now universally accepted that the effects of human-made climate change are already here, and that they’re going to get much worse.
Consumption markets might be spared the worst for a while, but a deadly heatwave that spread across sourcing and manufacturing destinations across Asia this April was made much more likely because of climate change. And the long-threatened 1.5 degree threshold for global warming now seems all but certain to be passed within the next five years.
Then consider just how quickly sustainability regulations are being introduced and enforced. Given the urgency of the problem this shouldn’t come as a surprise, but product passports are just the tip of the spear, and sooner rather than later both massive multinationals and single-country SMEs will be subject to the same official requirements for scientific, data-backed disclosure around their impact on planet and people.
And as it stands today, based on the level of visibility they have, and the level of technological maturity they’ve reached, very few brands are going to be able to comply with those regulations.
If there’s an existential threat to fashion, this is it. Changing consumer markets driven by unpredictable and extreme weather patterns. A humanitarian crisis on a catastrophic scale, disproportionately affecting the regions where fashion sources components and contracts labour. And punitive regulations that are already starting to enforce a level of disclosure and transparency that will be difficult – if not impossible – for most organisations to meet.
In these circumstances, the demands and expectations that companies have for PLM are destined to change. From core functionality like centralised product data and technical specifications, through to planning, supplier management, and much more, a lot of what the fashion value chain now needs is within PLM’s wheelhouse to deliver.
There will, though, likely to be two different schools of thought on how this should happen. And these will probably be correlated to the size of the business doing the thinking.
For a long time, a debate has been quietly simmering around whether PLM should “stay in its lane” and focus on improving core capabilities, usability, and stability, or whether it should be adding extra features. That debate is now taking on a new meaning as brands, retailers, and manufacturers begin to reckon with how to respond to all the disruptions I’ve already mentioned – but most importantly how they’re going to reshape their businesses to match the enormity of the sustainability challenge.
I suspect that larger organisations will prefer to continue to use PLM primarily as a system of record and a source of truth for style-level data and associated libraries. These audiences will more than likely want to manage supply chain risks, sourcing challenges, impact calculations, product provenance, and other variables in different best-in-class solutions that are then integrated into PLM. And in fact we’re already seeing these kinds of partnerships being forged.
For the smaller businesses that make up so much of the new-name PLM market every year, I think the emphasis might be different. Why, they might ask, can’t the platform that holds their key product attributes, tracks their journey from concept to approved production sample, and holds data on all their suppliers also be one of a small number of places they go to source the information they need to disclose for compliance purposes?
Or in other words, why can’t PLM be a sustainability and transparency solution by itself?
Quite how the technology market is going to respond to these asks is something we’re going to have to see develop over time (but not too much time, given the urgency involved). The Interline will be unpicking both the mandate for sustainability and how the broader technology landscape is evolving (and what that means
for sustainability tech as a standalone market segment) in a new report, coming later this summer. We expect to find both crossover with PLM and areas where entirely new platforms, solutions, and services are the only options.
As for PLM itself, I expect we’ll see further changes to how it’s labelled as it evolves in both directions: towards greater power in its core functions, and through partnerships and innovations in new directions.
But as unpredictability, climate change, and ethical consumption become even more prominent background forces in our lives, I suspect we’re going to see that beating heart become even more necessary than ever.