Volvo Cars’ Digital Technology Shift: How PLM, DevOps and CEVT’s Experiences Can Deliver World Class BOM Management
Verdi Ogewell posted on November 20, 2019 |

Configuration and BOM management are undoubtedly the bread and butter of car production.

Automotive manufacturing is literally about producing millions of Bill of Materials (BOMs) every year. The complexity of this variant management is extremely difficult to deal with, even for a smaller manufacturer such as the Geely-owned Volvo Cars, which produces and sells close to 650,000 cars annually as of 2018. Geely Group in total produces more than 2 million cars per year; this is almost as many cars as Mercedes. To put it simply, nearly every individual vehicle represents a master BOM (Bill of Materials), which in turn contains of a series of "sub-BOMs" or delivery modules/article structures for the engine, dashboard, gearbox, bodywork and more.

But it doesn't stop there. BOMs are also divided into several types. This includes engineering BOM's (eBOMs) produced via the PLM system, which are normally converted into manufacturing BOMs (mBOMs) in the ERP system. If you want to move it further along the chain, there are also such things as sales BOMs, service BOMs, and so on.

Added together, the number of BOMs involved is staggering. It’s clear that successful vehicle product realization at these volumes requires extremely capable systems to have any chance of success. The bottom line is that this is closely linked to how well a company will succeed in business. I would venture to say that these pieces are the most crucial factors in creating profitability.

So, how do you create the kind of successful configuration and BOM “mathematics” needed for world-class success in the face of constant and dramatic changes in product realization being imposed by new technologies? How did CEVT, Geely’s Sweden-based vehicle platform company responsible for developing Volvo's well-known Compact Modular Architecture (CMA), attack these challenges? What’s the role of Siemens Digital Industries’ Teamcenter suite? And what does DevOps mean within this context?

I will discuss these topics in today’s article, which is based on an interview with the man responsible for CEVT’s PLM solution, Erik Gräns. 

The Swedish-Chinese car manufacturer's digitalization program is very comprehensive and means that Volvo Cars is implementing a technology change throughout the organization to improve the customer experience and internal business processes.  In this transformation, the concept of DevOps plays an important role. But what does it mean and what can it mean for the way to develop the sharpest vehicle of the future?
The Swedish-Chinese car manufacturer's digitalization program is very comprehensive and means that Volvo Cars is implementing a technology change throughout the organization to improve the customer experience and internal business processes. In this transformation, the concept of DevOps plays an important role. But what does it mean and what can it mean for the way to develop the sharpest vehicle of the future?

A couple of weeks ago, Volvo Cars announced HCL Technologies as its IT service provider. There is nothing sensational about this, since HCL has been a supplier to Volvo in this area since 2016.

What’s interesting is that, within the framework of the agreement, this also includes HCL contributing to the implementation of Volvo's new digitization program, expanding the existing collaboration to run a large-scale digitization project and create business success with the help of new technology.

“DevOps Cooperation” with HCL and Capgemini

The Swedish-Chinese car manufacturer's program is comprehensive and means that Volvo Cars is implementing a technology change throughout the organization intended to improve the customer experience and internal business processes. This will, of course, affect all aspects of the business—PLM and ERP included.

On the ERP and SAP side, Volvo has a collaboration with another major global consultant, Capgemini, around S/4HANA.

Erik Gräns is responsible for CEVT’s PLM solution and its new capabilities for managing product configuration and BOMs. CEVT is Chinese automotive company Geely Group’s vehicle platform technology daughter, which has developed the CMA platform. This solution has been used as the platform by Geely-owned Volvo Cars, Lynk & Co., and the Geely vehicle brands.  Gräns and his 2,000-plus coworkers in CEVT produce the “bottom platform” which then is handed over to the customers in Geely Group.

Erik Gräns is responsible for CEVT’s PLM solution and its new capabilities for managing product configuration and BOMs. CEVT is Chinese automotive company Geely Group’s vehicle platform technology daughter, which has developed the CMA platform. This solution has been used as the platform by Geely-owned Volvo Cars, Lynk & Co., and the Geely vehicle brands. Gräns and his 2,000-plus coworkers in CEVT produce the “bottom platform” which then is handed over to the customers in Geely Group.

But whether it concerns PLM or ERP, the concept of DevOps plays an important role. But what does it mean, and how will it affect development of vehicles of the future?

Guidance can be found in another company within Geely Group—namely CEVT (China Euro Vehicle Technology), where PLM manager Erik Gräns ​​and his 2,000 coworkers successfully worked with PLM inspired by a DevOps attack angle. Among other things, CEVT has developed the CMA platform that Volvo Cars uses in vehicle development. The same platform is also used by Geely Group’s other vehicle brands, Lynk & Co. and Geely.

The digitization plan prepared by HCL and Volvo Cars contains measures to create a flexible and product-oriented organization. "Thus," HCL writes in the press material, "Volvo can handle the complexity of the business efficiently and get the products out to the market faster, but also benefit from advantages such as mobility solutions and subscription-based services, as well as electric and driverless vehicles."

But Volvo is not only leaning towards HCL in this. In July of this year, they also signed a collaboration agreement with global consultant Capgemini, which now delivers a wide range of transformation services including DevOps and cloud services. This also makes Capgemini another of Volvo's partners in digital transformation and cloud services.

However, the main focus of the Capgemini deal is on services and other matters related to the vehicle manufacturer's SAP solution, S/4HANA. Outside Volvo Cars’ business system side, in the PLM area their own proprietary configuration KDP data base and external suppliers are in force. The main tools are Siemens Teamcenter suite and Dassault's CAD solution CATIA V5, including solutions to bridge the V5 version into CATIA V6.

A Scary Business

A shift of this magnitude is always a “scary” business. There will be pitfalls, but the good news is there are workarounds and valuable experiences that already exist within the Geely Group. Specifically, we’re talking about CEVT and their journey to success, especially in the area of configuration and BOM management.

CEVT plays a key role in the development of new car models within Geely Group and Volvo Cars. Founded in 2013 and located in Gothenburg, Sweden, CEVT is owned by Geely Holding, which is also the owner of Volvo Cars. CEVT is an innovation center, focused on developing smart—or should we say, smarter—ways to build cars. They create platforms where much of the basic work is done when developing new models.

Volvo Cars and the CMA architecture are good examples of what CEVT is doing. It is basically the platform for the new cars that are being developed. This is done through a design based on a modular concept, where the PLM system in general—at CEVT as well as Volvo Cars—uses Siemens PLM's Teamcenter, and the product configuration in particular forms the main pillars of the development work.

“Product configuration tools are doubtlessly the bread and butter of the car manufacturing industry,” says Erik Gräns. “Having effective digital tools for this is fundamental,” he asserts, adding that, “The point is to be able to quickly plan, manage and make available features that surround this part of the product definition process.”

A key issue and critical success factor in the context of product structures and configuration is BOM data management.

“Absolutely, being able to validate product structure and data as early as possible is crucial,” Gräns continued. “It also allows our departments to work in parallel processes. The BOM data is the most important driver in the configuration work.”  

A PLM System Up and Running in Nine Weeks

It is not common practice to get a complex PLM solution in full operation in just nine weeks—especially not in the case of complex automotive industry operations. But this is exactly what CEVT succeeded in producing under the leadership of Erik Gräns when the business was launched in 2013.

Since then, all measurements have curved steeply upwards. In just six years, the number of employees has expanded from a few hundred to more than 2,000. CEVT now has offices in two Swedish cities, Gothenburg and Trollhättan.

CEVT develops, crash tests and test runs basic car platforms. The platform is then handed over to the client. In this case, Volvo Cars produces what Gräns describes as "a top hat" for their cars: exterior and interior design. The platform is a “skeleton” that Volvo Cars dresses up in an elegant state-of-the-art “garb.”

The CEVT developed CMA platform is a sort of “skeleton” that Volvo Cars can “dress up” in any state-of-the-art “garb.”
The CEVT developed CMA platform is a sort of “skeleton” that Volvo Cars can “dress up” in any state-of-the-art “garb.”

Dynamic Development Competition Keeps CEVT on Its Toes

The combination of PLM and CAD that both CEVT and Volvo Cars work with, consisting of Siemens’ Teamcenter and Dassault’s CATIA, is not unusual for automotive OEM’s.

Volvo has spent many years in these environments, but it was a newer experience for CEVT.

CEVT’s PLM journey began with Teamcenter at the start of the company in 2013, to handle product and system information in a tightly integrated way. At the same time, the vehicle development world is dynamic; nothing is carved in stone, and additions in functionality must be done continuously.

Here, Erik Gräns ​​and his colleagues chose a method of attack inspired by DevOps, an angle of problem solving that has been used since 2013.

In this, CEVT has worked closely with business and PLM development to deliver fast and efficient solutions. The PLM team consists of people with business-related analysis capabilities, as well as those who are competent in coding, implementing and operating the PLM system, which leads to effective results with high business value.

New Teamcenter configuration management features provide a good example of these dynamics.

“It is important to constantly be on our toes and take in things that sharpen our processes,” asserts Erik Gräns, adding that, “Vehicle platforms are complex and anything that simplifies the complexity and facilitates the ability to effectively manage complexity and variation across several car platforms is valuable.”

What is DevOps All About?

Generally, DevOps can be described as a continuous, never ending development process, often symbolized by the figure-eight symbol typically understood as representing infinity.

Robert Gistvik, from the consultant firm Frontit, has come up with a useful description:

“DevOps is a result of the agile methodology's need for fast cycles and is about the collaboration between development (Dev) and IT operations (Ops). What one aims at is to enable a culture and environment where it is possible to build, test and launch frequently, quickly and reliably.”

The focus is on cultural and structural changes, Gistvik continued. “It’s about bringing together those who develop and those who are responsible for the infrastructure. There is not a specific tool for DevOps, but instead it is a set of tools used in a chain where each tool fits into one or more of the phases.”

Note that the chain has no real beginning or end, so the results of measurements and conclusions of the latest launch should flow back into the planning section. The time between planning to the next step depends entirely on the conditions one's system has and what one wants to achieve, but the whole DevOps idea is based on shortening the timeline as much as possible.

“One of the goals is continuous integration (CI), which is about reducing the number of complex code mergers by continuously merging the code that develops into a common code base, preferably as soon as any new functionality or part of functionality is completed. In addition to the code being collected continuously, it should also be built and tested automatically at each check-in with unit tests to see that the new code does not have any unexpected consequences. CI is a vital part of being able to fulfill the Create (and partly Verify) part of the DevOps toolchain,” noted Robert Gistvik, adding that the concept “requires well-developed test automation in order to be successful.” 

What are the general gains with DevOps?

“In a quality context, you sometimes talk about, ‘you become what you measure.’ The same principle can be applied in this area. With DevOps, operations can be steered in the desired direction. If the most important goal is to be able to get their releases out quickly, there are tools for that, but DevOps can just as well be used to only increase the quality of a product,” explained Gistvik.

As of spring 2019, the Volvo Cars XC40 model for the Chinese market is being built at a manufacturing facility in Luqiao, south of Shanghai, which is owned by Geely and operated by Volvo Cars. By doing this, XC40 production will be closer to the Chinese market and will follow previous production increases to meet XC40 customer orders.
As of spring 2019, the Volvo Cars XC40 model for the Chinese market is being built at a manufacturing facility in Luqiao, south of Shanghai, which is owned by Geely and operated by Volvo Cars. By doing this, XC40 production will be closer to the Chinese market and will follow previous production increases to meet XC40 customer orders. "Demand for the XC40 has exceeded our most optimistic expectations," said Håkan Samuelsson, CEO of Volvo Cars. "Building the XC40 in Luqiao creates extra capacity, provides flexibility in our global manufacturing network and is a clear proof of our strategy of 'building where you sell.'"

That being said about DevOps, let’s move ahead to see how this can work out in real life practice and how CEVT has considered this from a PLM and configuration perspective.

Wanted an Out-of-the-Box Solution

New Teamcenter configuration management features are examples of these dynamics. A key element of this is understanding and capitalizing on the common features of product variants in order to effectively manage the complete range of configurations and maximize reuse.

At the center of CEVT's initiative is Teamcenter's “Product Configurator,” a variant management solution that enables the company to plan, manage and report variations from idea to production.

“The solution we have developed around this makes it easier for everyone to do their job. No one needs to think of another tool for managing configuration data,” says Gräns.

He adds that they wanted an "out-of-the-box solution." The benefits are multiple: an out-of-the-box solution offers new opportunities, superior flexibility and requires no customization, while lowering the cost of ownership.

“We had a vision of what we wanted to achieve,” explains Gräns. “We needed to develop a solution that would serve as a global foundation for us, without us having to reinvent the wheel for that reason.”

The solution CEVT implemented around product variant management and BOM makes it easier for everyone to do their job. No one needs to think of another tool for managing configuration data.
The solution CEVT implemented around product variant management and BOM makes it easier for everyone to do their job. No one needs to think of another tool for managing configuration data.

First in the World with Teamcenter's New Product Configurator Generation

With Teamcenter’s Product Configurator, Gräns ​​claims that the management of product functions, compatibility and impact assessment has been sharpened over the product life cycle.

In April 2017, with the implementation of Siemens PLM's new generation of product configurators, CEVT saw the first major upgrade in the world from Siemens' previous generation of product configurator software.

This was a big step, but also a natural next step in CEVT's PLM development strategy. For platform solutions that have been developed to hold a world-class standard, and working with the dynamics that characterize today's automotive segment, it is important to continuously expand capabilities. CEVT has therefore renewed its PLM platform to a large extent over the past three years. In particular, this relates to CEVT’s rapid growth.

In fact, the Teamcenter environment has been defined as the main model for the entire Geely Holding Group, and has been used from January 2018 onwards to serve the entire global organization.

One year after the implementation, there are now a total of about 7,000 users, including 3,300 simultaneous users in Teamcenter.

Today, variant planning is often disconnected from the actual product development and configuration. This can lead to a gap between product management and product marketing. As Siemens PLM says of its latest generation configuration solution, it will be

Today, variant planning is often disconnected from the actual product development and configuration. This can lead to a gap between product management and product marketing. As Siemens PLM says of its latest generation configuration solution, it will be "difficult to get a grasp of how the product will look in the market" and how the various engineers in the development team develop solutions to support the marketing vision for the product. But what if you can link variant planning to the "real" product development? 

With Teamcenter, Siemens PLM believes that it has widened the limits of what can be done, compared to traditional product configuration software. Siemens has always talked a lot about its "Integrated Product Definition" and BOM management, including discussions about BOM configuration management and the best methodology for configuration management. They believe the new Teamcenter Product Configurator to be the "best answer on the market" to this type of problem. Today it can be stated that CEVT, with its installation of Teamcenter’s Product Configurator, was among the first globally to invest in this. It is something that has paid off well, argues Erik Gräns.

Almost as Big as Mercedes

Over the years, Geely has developed into an ever-larger player in the automotive market. In 2018, Geely Holding Group sales for its entire car group increased by 18.3 percent to reach 2.15 million cars sold. By comparison, Mercedes' total sales for 2018 was 2.3 million cars.  

The first car built with the new product configurator was another brand in the Geely stables: Lynk & Co. 01, which rolled off the production line in August 2017. From February 2018, between 10,000 and 15,000 cars manufactured by Geely companies have been developed using the Teamcenter Product Configurator. Sales of Lynk & Co. models 01, 02, and 03 ended up at 120,000 in 2018.

But the companies in the Geely group aim higher than just having this configuration solution as an internal development and production tool. The goal of CEVT and Geely is to enable their customers to visually configure a car online. In this, they need to understand what is possible, what the chosen configuration costs and when it can be delivered.

“We want to make sure that we can effectively sell what we produce. It should be straight through valid configurations that use the definitions of possible variables that our Teamcenter backbone allows,” says Erik Gräns.

Digital Twins and a Single Source of Truth

Perhaps one of the most important aspects of CEVT's product configurator is the ability to provide a single source of product configuration information, “one single source of truth,” to guide and validate the product development lifecycle.

“We needed this for things like R&D, technology, product planning, sales and to be able to validate during the product life cycle,” explained Gräns. “Now everyone can see the same information at the same time. Teamcenter has made this possible.”

But anyone who aspires to be a global player must also find a way to keep this information consistent.

“Indeed, we don't want islands of information. Otherwise, it is typical for our industry that OEMs have several systems, but that would not work for us,” Gräns stated.

CEVT has also experienced a radical improvement in the seamless product documentation that goes on throughout the product development and manufacturing journey.

“On the bottom line,” commented Gräns, “the company's vision is to define a full digital twin over the entire product life cycle, including product, production, service and sales.”

"We don't want islands of information," said Erik Gräns.

To Establish a Parts-Led Approach

CEVT now works from a parts-driven perspective. They start with parts early in the process, separate them from the designs, and customize them—which is also why capability for early verification and validation of BOM data, including parts and product configuration at the platform and vehicle levels, is so essential.

“Very early in the product definition process, the focus is on CAD,” said Gräns. “As the product definition matures and you begin to shift your focus to become parts-driven, there is often a lack of connection in the definition of product variables, which needs to be resolved if you work across multiple systems.”

It is always associated with some concerns to transfer data from one system to another. This is not news, but the phenomenon nevertheless exists.

“Yes, normally you get a lower quality and have to redefine a lot of information when you ‘move’ to a parts focus. But we have not suffered from this because we have retained both parts and design in the same core system, Teamcenter, and adapted them there,” Gräns added.

Careful Visualizations

By using this tightly integrated “PLM approach” for product and process configuration, the impact on the variants becomes clear, easy to understand and accounted for at all stages of product development. Accurate visualizations are available on request to all users regarding any product configuration, or even for a variety of product configurations at once.

This offers proactive, industry-unique progress and allows CEVT engineers to clearly grasp and understand the effects of new and developed product features in conjunction with product requirements, product definitions and manufacturing processes.

These capabilities come with Siemens new generation product configurator, claims Gräns. “Attention is quickly given to relevant functions and the affected product solutions, making a previously rather tedious, perhaps even erroneous, process simple and correct.”

What does the next step look like? CEVT plans to further utilize the Teamcenter Product Configurator to formally handle variability and product definition, which is even more closely tied to the platform-centric strategy. By utilizing reusable product architectures broken down into parts, it is meant to be able to plan and manage the product definition with maximum modularity and reuse across the platforms.

It’s a tough job, but Erik Gräns and his colleagues have already proven what they can achieve.

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