PLM Series 2022
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Innovator Spotlight: Volvo Construction Equipment

On a mission to build a better tomorrow, Volvo CE prioritized collaborative ways of working through a PLM-enabled digital thread, positively impacting both upstream and downstream stakeholders.

Overview: How Volvo CE reduced design, manufacturing, and service complexity with a digital thread

Volvo CE, a global leading manufacturer of construction equipment, manages a portfolio of products and brands that together maximize its profitability and market share. For Volvo CE, a history of acquisitions combined with rapidly changing market conditions, shorter lifecycles, and new product features led to a high level of complexity in its data, processes, systems, and organization. With increasing cost implications and pressure to get products to market faster, leadership had to make a change.

Volvo CE sought to establish an end-to-end product development process based on a single source of product data to create more efficient ways of working, an optimized user experience, and tool chain integration. Volvo CE implemented Windchill, PTC’s PLM solution, to manage its products throughout the entire lifecycle—integrating people, processes, information, and business systems. It sought to increase efficiency and quality to improve customer satisfaction with fewer mistakes caused by information handovers.

The results to date have been significant:

UP TO 50%
Icon_DownArrow reduction in the number of late loopbacks
UP TO 30%
Icon_DownArrow reduction in the cost of poor quality
UP TO 70%
Increase-Arrow efficiency gain from quality of work instructions
UP TO 30%
Increase-Arrow improved change management handling
UP TO 40%
Icon_DownArrow reduction in duplicate parts
UP TO 30%
Icon_DownArrow reduction in poor data entry (human errors)
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Challenges

For Volvo CE there was an urgent need to increase efficiency without compromising the ability for teams to release high-quality, innovative products and solutions to market. Yet, its legacy IT systems did not support a concurrent way of working across its global teams.

Internally, there lacked commonality across processes, systems, and data –resulting in redundant designs and products that were too hard to manufacture and service. Reducing complexity became a strategic imperative to beat the competition and achieve margin and revenue targets.

Externally, market conditions were changing rapidly putting pressure on Volvo CE to shorten the product lifecycle. There was an urgency to develop new business models and establish integrations across the value chain to do so. New mechanical components, smart products and services, and customized products were all at the forefront of Volvo CE’s innovation strategy.

But without a globally established product development process in place, teams lacked the digital traceability and governance to meet customer requirements.

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Solution: Establishing a PLM-enabled digital thread

Volvo CE is driven by portfolio growth, excellence, and innovation, with an eye towards sustainability and environmental care. To help achieve these strategic objectives, it needed to unify its product development systems with a goal of continuous improvement.

To do so, Volvo CE turned to Windchill as its information backbone to establish global and local processes that broke down organizational silos. With Windchill’s out-of-the box capabilities, along with PTC’s value-ready deployment methodology, Volvo CE created an end-to-end value flow and established a strong approach to program management.

Leveraging Windchill’s open architecture and easy integrations with other enterprise systems, Volvo CE recognized the opportunity to establish a digital thread and a consistent product architecture. Rather than working in siloed systems and manually handing over product data, this enabled all teams to collaboratively manage product hardware and software complexity in one place.

Volvo CE’s new approach to PLM has covered all of its fundamental product lifecycle needs. Furthermore, it has laid the foundation for broader value across the entire organization, giving employees access to capabilities that allow them to better contribute to the company mission of building a better tomorrow.

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Implementation Spotlight

Volvo CE uses Windchill to improve efficiency and performance across the organization. Establishing a best-of-breed IT solution motivated its employees and increased global collaboration and process optimization from planning/requirements management, to product development, sales configuration, production, aftermarket, and phase-out. The spotlights below highlight Volvo CE’s core leadership initiatives to execute this strategy by establishing a PLM Foundation with collaboration at its core.

Building a Better Tomorrow
From PDM to PLM
Commitment to Collaboration
By implementing a PLM-enabled digital thread, Volvo CE can more easily manage increasing product complexity and focus on innovation and collaboration.
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Volvo CE turned to PLM for a product-centric information backbone—a digital thread—that serves as the authoritative source of truth across engineering, operations, suppliers, and customers.
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During their digital transformation, Volvo CE drove change from the bottom up. All job functions were involved in developing a strategy and value flow/KPIs, from senior vice presidents to operational experts.
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