PLM 2010: Game changers

 

Life around us is changing dramatically. The current global economic situation and technology have the potential to change the business and industry landscapes for many existing companies. When I look at the companies’ performance indicators and on how users are looking for highly optimized solutions, I think that this will result in what I term as ‘game changers’. Crisis and downturn is always a time when you cannot do ‘business as usual’ and you need to come up with a diversified solution and technological set. So, with this intro, I’d like to sum up my potential ‘game changers” for PLM in 2010.

PLM Evolution

Product Lifecycle Management is in a complex position. The two biggest elements of this position are value proposition and enterprise software cost. What actually happened is that the market became mature for PLM. Companies have recognized the value and benefits on one side, but perceive PLM solutions as being expensive, on the other side. This creates a barrier on the PLM road to success. In the current economy, cost becomes the driver for change. The companies that will be able to lower the costs of their solutions while keeping the value of PLM value will be leapfrogging in 2010.

Microsoft Enterprise Convergence

The long-term dominance of Microsoft in the Desktop application was the foundation of enterprise productivity. MS Office and beyond-Office applications hold the majority of the enterprise market share. With the development of SaaS based alternatives, Microsoft will be actively looking at how to increase their enterprise presence by multiple product and technologies for the enterprise. For Microsoft, the next disruptive offering afterwards will be the enterprise information worker. MS Office, MS SharePoint and other products look like a very good platform for this, and MS will be actively moving in this direction. The ability to converge PLM collaborative capability with the Converged Microsoft offering can have a good potential for companies in this space. 

Google Push 

Google Push into the enterprise is becoming more visible. GSA and Google Apps comprise a potential collaborative platform for the enterprise in the future. In addition, Google offerings in 3D technologies such as SketchUp and O3D have the potential for future mainstream deployment in applications related to 3D design and Product Lifecycle Management.

Open Source

Open Source software has not reached a leading edge in the PLM industry. But, in the current economy, some vendors can consider the open source option for gaining access to new potential customers. When initial license cost is going down and there is visible increase in service and recurrent revenues trend, open source has a good potential for growth.

I’m sure that there are other trends and opportunities for making changes in the PLM industry. I’m convinced that in the near future, manufacturers will be looking for new and innovative ways to solve their problems. I think that the trends mentioned above have a good chance of being part of these new stories.

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8 Responses to PLM 2010: Game changers

  1. Tom Gill says:

    Hi Oleg,

    Could you elaborate on when you think Open Source will reach the leading edge of the PLM Software market?

    Also, I’ve seen several articles on companies dropping software maintenance on licenses to reduce expenses. Since most vendors charge a penalty to reinstate the licenses, what impact do you think this might have? Do you think the “game changer” will come from an existing player?

    Tom Gill

  2. Tom,
    I don’t know when Open Source will reach the leading edge. This is not about technology in my view, but more related to business model and overall environment – means how many other Open Source vendors are around.
    My prediction is that Open Source have potential to become “game changer” in current product/technology landscape. – Oleg.

  3. Tom, interesting statistic on open source in CNet announcement – Up to 24 percent of software purchases now open source. http://news.cnet.com/8301-13505_3-10238426-16.html?part=rss&subj=news&tag=2547-1_3-0-20
    I don’t know how this number is accurate but trend is clear. -Oleg.

  4. Oleg, thanks for another interesting post. Always good to step back and think over the trends. We’ve been distributing open source PLM for nearly 3 years, and while the growth rate in downloads has always been very good, the download rate accelerated 2x at the beginning of the economic crisis (about Nov-2008). You are 100% right that this crisis is deep and broad enough to force some ‘game changing’ thinking in the PLM industry.
    What I find interesting is that even the ‘open source’ model is under change. The new adopters are influencing the model to suit their business needs, and the final result will somehow combine typical Microsoft Office / SharePoint on-site software and Cloud Services together.

  5. Peter, Your point about influencing model is very interesting. Do you see Open Source will morph to something different in the future? Do you see any trend toward hybrid models? – Thanks.Oleg

  6. Open source is already morphing! Can you imagine 5 years ago talking about open source and Microsoft in the same sentence? In the past, open source meant you had to have source code all the way down to the firmware on the chips, and it was primarily academic users. Your prediction of hybrid models is a reality. Now we see Commercial users are running open source business applications on top of the Microsoft stack. These users neither need nor want the source code for the whole stack.
    I think the hybrid model is here to stay.

  7. Samuel says:

    Good to hear what you see as PLM technology trends. Have you also posted on PLM business trends. Like ‘globalization’, ‘outside-in’ development, etc?

  8. Samuel, Business trends… this is interesting turn. I will think about it :)… Oleg

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