Why is product lifecycle management important? | Product management #3

What is a product lifecycle?

The product lifecycle is a crucial process in product management. It involves a series of stages that a product goes through, starting from the creation of the prototype to its potential withdrawal from the market. The duration of each stage may vary depending on the product and market. Understanding the phases of this process is essential for anyone looking to manage a product effectively.

The importance of PLM for companies is evidenced by statistical data. For example, according to data from Statista, the product lifecycle management market is expected to reach a value of $50.7 billion by 2023.

The stages of a product lifecycle

The product lifecycle consists of several key stages. These are:

1. Development – at this stage, a product prototype is created, which is then tested and refined. For instance, when developing a new mobile application, an initial basic version is built and evaluated by a small group of users. Their feedback is essential for refining the application before its official launch.
2. Introduction – at this stage, the product is ready for sale but is not yet popular due to being new to the market. An example of this can be the introduction of a new application to the App Store, where, through marketing efforts, the number of users gradually starts to increase.
3. Growth – after a successful launch and an effective marketing campaign, the product enters a growth phase, becomes more popular, and attracts more users.
4. Maturity – at this stage, the sales of the product stabilize. The product has a strong reputation and a loyal customer base. Applications such as WhatsApp and Spotify can be good examples here, as they have devoted customers, as well as regularly introduce updates and new features to maintain user interest.
5. Decline – at this stage, product sales start to drop, which can be attributed to various factors, such as the emergence of competing products, changing user preferences, or technology obsolescence. An application in the decline phase is usually no longer updated and can’t compete with new, more advanced solutions on the market.

The importance of product lifecycle management in your business strategy

Understanding the PLM is crucial to developing a successful business strategy. A company needs to be able to predict which stage its product is in to make the right decisions concerning:

• investments in product development,
• marketing strategies,
• product withdrawals and recalls.

For example, at the product development stage, a company may choose to invest in research and development to create a product that meets users’ expectations. However, it would be a mistake at this phase to launch the product hastily, without proper testing and optimization, as it could lead to negative user feedback and poor sales.

The role of a product manager in product lifecycle management (PLM)

PLM is a process that involves planning, executing, and controlling all stages of the product lifecycle. It plays a significant role in the success of a product, as it allows a company to optimize its resources and maximize profits.

In the product development stage, a product manager is responsible for:

• identifying market needs,
• creating a product concept,
• coordinating engineering teams to build a product prototype.

In the introduction phase, a product manager deals with:

• developing a marketing strategy,
• coordinating sales,
• market monitoring.

In the growth stage, a product manager concentrates on:

• optimizing the product,
• expanding its reach,
• scaling operations.

In the maturity phase, a product manager’s responsibilities include seeking new opportunities for product development, managing competitors, and ensuring customer loyalty.

In the decline phase, it is up to them to decide whether to withdraw the product from the market or not, manage diminishing resources, and plan the next steps.

The future of product lifecycle management (PLM)

The future of product lifecycle management seems to be closely linked to the development of technology. Product lifecycle management software is becoming more and more sophisticated, offering companies tools to automate and optimize PLM processes.

Oracle PLM, Siemens Teamcenter, and PTC Windchill are software solutions that help companies in managing data, changes, and quality control of digital products throughout the entire product lifecycle.

Summary

The product lifecycle is a crucial process for any company striving to succeed in the market. Understanding this process and effectively managing it, can have a significant impact on the success of your product. In the era of digitalization and rapid changes, management has become more complex, but it also offers new opportunities for those who can effectively use available tools and strategies.

Proper product lifecycle management can give you a significant competitive advantage through the analysis of relevant data and making informed decisions. As a result, it is not only a key element of any business strategy but also an area that offers numerous opportunities for innovation and development.

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