Today, measuring ROI for cloud PLM and QMS investments has evolved beyond traditional cost‑based justifications. While reduced infrastructure costs and lower total cost of ownership remain important, leading manufacturers now evaluate ROI through a broader, more strategic lens that emphasizes speed, resilience, productivity, and risk reduction across the product lifecycle.
The most successful companies track ROI as an ongoing measure of operational performance and business agility.
The sooner companies can get products to their customers, the quicker they can realize profits and first-mover advantages. Emerging technology companies require the ability to innovate rapidly with global teams to gain a competitive edge over established competitors. Their very success is measured by the speed it takes to invent and commercialize new solutions or products.
PLM and QMS solutions enable companies and their partners to design, test, develop, produce, and deliver high-quality products that work as designed. Paybacks achieved through efficiency and faster approval cycles are common and relatively easy to measure. The ability to track business process improvements for review and release cycles for engineering change orders (ECOs), closed-loop quality management, NPD, and/or overall time to market (TTM) illustrates the types of benefits that can be benchmarked and measured.
Over 1,450 Arena customers worldwide have evaluated and implemented our PLM and QMS solutions. We’ve captured key metrics of efficiencies gained by these customers through regular quarterly business reviews (QBRs) and customer case studies. Observed metrics include reduced costs stemming from operational efficiency gains as well as cost of goods sold (COGS). Additional business process improvements have been identified by accelerating regulatory compliance, reducing scrap and rework, and improving time to market.
CIMdata analyzed PLM benefits and ROI metrics and explained how businesses can realize key benefits.vi Their analysis stemmed from studies for Hewlett Packard, FMC, and other manufacturers. Given their examples and analysis, CIMdata cited a range of ROI metrics and benefits that could be attributed to the following areas:
“Affirmed Networks reduced engineering change cycle times by 90%.”
– Ron Garron, Director Operations
CIMdata also provided common investment measurements to consider when evaluating ROI:
Likewise, Arena has considered key metrics and case studies across many customers and industries. Benefits can vary based on prior tools and solutions used, size of company, outsourcing model, product complexity, and added regulatory compliance requirements. We’ve focused the ROI metrics among four areas of product development and present averages based on our experience:
