PTC and Ford: Using PLM to Track Supplier Sustainability

We recently came across this announcement from PTC and Ford suggesting that PLM tools might become a critical component of tracking sustainability metrics at the part and bill of material level. According to the announcement, "As part of a broader commitment and blueprint for sustainability, Ford Motor Co. is now surveying 35 of its top global suppliers to gain a better understanding of their greenhouse gas emissions footprint ...The 35 suppliers, which represent close to 30 percent of Ford's $65 billion in annual procurement spending, initially include companies that make commodities such as seats, steering systems, tires and metal components." Ford then plans to use a PLM toolset to granularly track sustainability metrics and details.

But the real secret green sauce behind the effort lies with putting sustainability information back in the hands of those who need it most -- the design engineers. Just as the majority of cost in a product is already influenced and locked-in during the design phase, so is its environmental footprint. Accordingly, Ford plans to use its PLM toolset to work with suppliers "to match parts in the bill of materials with models of their individual carbon and energy impacts," which in turn will allow engineers and designers "to roll up the carbon and energy impacts at a vehicle level" and identify design changes that will have the greatest environmental impact.

What's most interesting about this announcement technically is that Ford is using a design toolset to drive its direct materials sustainability efforts (rather than a supplier information management or related procurement spend analytics platform). Even though a range of products within procurement today -- including newer generation spend visibility tools such as Endeca -- allow companies to capture and enrich spend data with related datasets (e.g., sustainability, compliance) at the line-item level, this announcement suggests that the real power comes from looking at this data in the context of engineering and design drawings. If Ford's approach becomes more common, perhaps we'll see procurement organizations begin to look at sustainability details in the aggregate through supplier management and spend analysis platforms, reporting on the supplier level, while leaving the task of getting down to the material, part and bill of material level for item-level reporting, analysis and collaboration to the PLM players.

Jason Busch

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