Efficiency spotlight falls on merger

Electronic Data Systems Corp.'s acquisition of Structural Dynamics Research Corp. (SDRC) underscored last week the need for large enterprises to integrate product development with their supply chains. SDRC drove the message home by announcing partnerships with i2 Technologies Inc. and Asera Inc., as well as a suite of collaboration offerings.

Product development collaboration mixed with SCM (supply-chain management) software radically cuts time to market, lowers the cost of change management, and boosts revenues, according to analysts.

Forrester Research Inc., for instance, has seen a greater demand for improved product development systems among global companies, said Navi Radjou, an analyst at the Cambridge, Mass.-based market researcher.

Improved collaboration via the supply chain will mean a greater commitment to consulting, particularly in change management, Radjou said. "Firms can't expect to reap the benefits of their supply-chain apps unless they have promoted a collaborative culture that is conducive for information sharing," he said.

By combining with Milford, Ohio-based SDRC, EDS plans to provide software and services to digitally produce and share product planning, design, manufacturing, and distribution information for collaboration via corporate networks and the Internet. SDRC and its subsidiary will become the Unigraphics Solutions business line for the Plano, Texas-based EDS.

Bill Carrelli, SDRC's vice president of market and business development, said that SDRC's No. 1 reason for merging with EDS was to tap in to EDS' global reach and resources. Carrelli also said that partnerships with i2 and Asera are in place.

TeamCenter, SDRC's new collaboration suite, will simultaneously engage all of a company's partners from the project-design and product-requirements phases through the project and life-cycle management phase.

Ford Motor, a longtime SDRC partner, has been using collaboration techniques for years, beginning with sharing data through a mailbox system as long as 15 years ago, said Dan Snedecor, global release and supplier systems manager at Ford in Dearborn, Mich.

Snedecor said applications such as TeamCenter will allow Ford to cut down on product development time and will reduce the cost of making changes to products. "The earlier you find a problem in design compatibility, the cheaper it costs [to fix the problem]. If you have to fix the problem by retooling a plant, it is a tremendous cost," Snedecor said.

A case in point is Ford's discovery last week of a design flaw that forced the recall of thousands of Ford Explorers because the width of the vehicle was slightly too wide for the width of the assembly line in its Louisville, Ky., plant.

Experts said that if tools allowing collaboration between product-design and manufacturing-design teams had been in place the problem could have been at least foreseen before 50,000 sport-utility vehicles rolled out of the plant with cut tires.

(Additional Reporting by Brian Fonseca)

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