Product Life Cycle
Innovation has become the new battleground for today’s top companies. But finding great ideas, choosing which to invest in, getting them to market quickly, and optimizing them over time is far from easy. To accelerate the growth and stand out in the crowd, Product lifecycle management (PLM) is an innovative strategical boon.
PLM is the process of managing the complete journey of a product from initial ideation, development, service, and disposal. In crux, it means managing everything involved with a product, inside and out. With today’s product offerings coming in many flavors, PLM evolves itself to become a smart and connected platform to deliver the velocity needed to support digital transformation and drive faster product launches. The elements of a modern PLM platform are essential for companies that depend on innovations to help them grow. It is a solution that unifies processes, allowing for a seamless flow of data from idea capture to design, all the way through manufacturing and service so one can accelerate global product launches and time to market share.
Modern PLM involves everything from innovation management to product development, quality management, and every minute detail becoming part of the process. But, why does one need to focus their attention towards it?
Well, apart from the above-mentioned features,
1. PLM accelerates change management.
2. Minimize design cost.
3. Reduce supply risk.
4. Centralizes document management.
5. Awareness ofthe risks and profits involved.
Stages of Product Lifecycle.
The development stage of the product life cycle is the research phase before a product is introduced to the marketplace. This is when companies bring in investors, develop prototypes, test product effectiveness, and strategize their launch
The introduction stage is when a product is first launched in the marketplace. This is when marketing teams begin building product awareness and reaching out to potential customers. Typically, when a product is introduced, sales are low and demand builds slowly. Usually, this phase is focused on advertising and marketing campaigns.
During the growth stage, consumers have accepted the product in the market and customers are beginning to truly buy in. That means demand and profits are growing and market for the product is expanding and competition begins to develop.
The maturity stage is when the sales begin to level off from the rapid growth period. At this point, companies begin to reduce their prices, enhance the features, intensify distribution, to stay competitive amongst growing competition. During the maturity stage, products begin to enter the most profitable stage. The cost of production declines while the sales are increasing.
During this stage, competitors begin to take a portion of the market and products experience neither growth nor decline in sales.
At this point, you want your product to become the brand preference so you don’t enter the decline stage.
If your product doesn’t become the preferred brand in a marketplace, you’ll typically experience a decline. Sales will decrease during the heightened competition, which is hard to overcome. So either product is dis-continued or it is innovated and iterated in some way.
To understand better let’s take the example of lifecycle of FLOPPY DISK.
This relic was once a popular and convenient way to store and share data between computers and it astounds me to think of the very existence of cloud data sharing and other mass memory storage means.
Development: The first floppy disk was developed in 1970 by IBM engineers. It was an 8-inch flexible magnetic disk in a square case with 2MB storage capacity.
Introduction: It was introduced in 1971 and largely became known as the only way to transfer or major decline up to Hewlett Packard (HP) stopping production for the disk in 2009. The storage capacity for other products in the market grew to be more efficient.
Growth: The floppy disk was majorly used in the 1980s-1990s.
Maturity: Sold well in the market during the 1990s. Improving with time, it could hold 200MB of storage.
Saturation: Major competitors emerged at the beginning of the 21st century. The invention of USB cables, external hard disks, CDs and more gave people options to store their data.
Decline: The floppy disk faced a major decline up to HP stopping production for the disk in 2009. The storage capacity for other products in the market grew to be more efficient.
However, remember , not all products need to face the decline stage. Companies can extend the product life cycle with new iterations and stay afloat as long as they have several products at various points of the product life cycle.