However, this change in the PLM’s role also triggered a shift in its design and implementation. Now, PLMs are expected to correct data misalignment between engineering and production, and enable delivery of increasingly complex, mass-customized, and servitized products. Manufacturers no longer have the bandwidth to undertake weeks-long, $60k worth of PLM upgrades every couple of years. They need self-upgrading platforms that are agile, nimble, and play well with their evolving technology stack.
In other words, manufacturers need cloud-based PLM systems that alleviate the troubles of their on-prem counterparts. Fortunately, this shift will leave manufacturers with more breathing room in their technology budgets, while enabling them to build unmatched continuity and context in their product lifecycle.
The business case for cloud-based PLMs
Traditional PLMs are rapidly becoming an obstacle for manufacturers navigating today’s competitive industry landscape. Deployed on-premises as clunky instances, they not only require regular, manual upgrades but also require hardware-level interventions to scale up. Upgrades tend to run into tens and thousands of dollars and repeatedly disrupt established functionality.
Lessons learned from the CPG industry
While legacy, on-prem PLMs do offer a high degree of customization, the latter raises the overall complexity of the deployments. Moreover, integrations require custom connectors, which adds further to the maintenance burden of the overall deployment. But more importantly, legacy PLMs fail to exploit the abundance of data that is generated across the engineering, production, service, and customer experience domains in the product life cycle.
For these reasons, cloud PLMs make financial and strategic sense for manufacturers. While their easy maintainability would be adequate to convince IT teams that are tasked with the maintenance of on-prem PLM deployments, the upsides of cloud PLMs go far beyond.
The upsides of cloud PLMs
The foremost benefit of cloud PLMs is the logical continuity and traceability that they bring to the product life cycle. In heavily engineered products with multiple variants, cloud PLMs can reduce the complexity of orchestrating the product life cycle, and build a continuous feedback loop across the value chain.
Here are some of the key benefits of cloud-based PLM solutions:
- Cost benefits: Cloud PLMs eliminate the operating and capital costs associated with hosting, upgrading, and maintaining on-prem PLMs. Their updates and patches are automatically handled by vendors, with most offering lucrative SLAs that on-prem PLMs are seldom capable of delivering without heavy investments.
- Increased agility: Setting the foundation for digital threads, cloud PLMs bring continuity to the plan-to-operate and design-to-build process. At the same time, they also inform engineering teams with direct customer feedback from service and customer experience data domains. This accelerates time-to-market and elevates quality outcomes.
- Easy integration: Cloud PLMs are easy to integrate with QMS, engineering design, ERP, MES, and Industrial IoT networks. This enables manufacturers to mature their connected digital manufacturing vision for complex, configurable products. This composability will trickle to 60% of all PLM applications by 2028, making it easier for businesses to implement digital threads.2
- Bidirectional scalability: Because they are hosted on cloud, modern PLMs can be scaled up and down within minutes based on the changing requirements of manufacturers. This elasticity enables businesses to size their digital estate strategically over time.
- Frictionless collaboration: By bringing engineering and manufacturing to the same page with real-time product data, cloud PLMs remove the critical gaps that otherwise cause rework, production delays, and quality issues.
These advantages of cloud PLMs over their legacy on-prem counterparts make PLM cloud migration an inevitable step in the strategic agenda of manufacturing organizations today.
PLM cloud migration: key considerations
Migrating PLM data to the cloud calls for a carefully calibrated strategy that addresses the security requirements of sensitive IP, and how the PLM deployment fits into the overall enterprise architecture. Here are some key aspects that must be considered:
#1. Ensure interoperability across enterprise systems
The deployment should sync seamlessly with ERP, MES, CRM, and CAD platforms using middleware that supports real-time, bidirectional data flow. The cloud PLM can then be architected to index and query product data across distributed repositories, enabling unified analytics and decision-making.
#2. Plan secure data transfer and adopt zero-trust security principles
Configure the cloud PLM to restrict data movement and use geo-fencing and watermarking to safeguard sensitive IP. Use hybrid encryption, VPN tunnels, and cloud identity providers (IdPs) to control data migration and enforce least-privilege access in multi-tenant cloud PLMs.
#3. Design a unified digital thread framework pre-migration
It is crucial to define process-level mappings between upstream and downstream systems to ensure the digital thread remains intact and traceable post-cloud migration. In addition, classification schemes, naming conventions, and metadata fields should be aligned before migration to avoid schema mismatches or logic failures during cloud ingestion.
#4. Automate compliance and traceability controls
Lastly, the cloud PLM should be configured for built-in audit logging, automated validation workflows, and digital signatures to enforce traceability from requirements to design, manufacturing, and service. This is also a good opportunity to integrate e-signature protocols and embed configurable rule engines to auto-validate BOMs, change requests, and documentation against compliance standards like ISO 9001, IATF 16949, REACH, or RoHS.
