Cloud PLM and disruptive technology economic impact

We love word “disruptive”. It is so nice and tasty. However, very often, we use it without thinking twice what does it mean. Read materials from many startups and large companies – you found lots of statements about “disruptive technology” or “disruptive innovation”. Wikipedia article provides a very decent definition of what disruptive innovation and technology mean.

A disruptive innovation is an innovation that helps create a new market and value network, and eventually goes on to disrupt an existing market and value network (over a few years or decades), displacing an earlier technology. The term is used in business and technology literature to describe innovations that improve a product or service in ways that the market does not expect, typically first by designing for a different set of consumers in the new market and later by lowering prices in the existing market. The term “disruptive technology” has been widely used as a synonym of “disruptive innovation”, but the latter is now preferred, because market disruption has been found to be a function usually not of technology itself but rather of its changing application. Sustaining innovations are typically innovations intechnology, whereas disruptive innovations change entire markets.

I’ve been reading McKinsey Names the Most Over-Hyped (and Under-Hyped) Major Technologies Out There article earlier this week. McKinsey made an analyzes of projected economic impact of disruptive technologies. I found the diagram interesting.

Navigate here if you want to read a full report. I also found the following passage notable.

In its latest report, MGI set out to answer an even more unanswerable question: What will be the economic impact of the dozen most “disruptive” technologies, including utility devices that talk to each other, cars that drive themselves, and printers that can print printers? Their summary graph is the image that kicks off this post. In a sentence: There’s mobile Internet, and then there’s everything else.

What is my conclusion? To predict a future is one of the most risky things. McKinsey ranked cloud as #4 by a potential economic impact. In my view, cloud can make a difference. Will cloud drive future difference of enterprise software and PLM systems? Pure speculations… Nevertheless, I like McKensey’s numeric approach. PLM vendors must take note – the time of fluffy marketing is about to end. Data first. I’m looking forward to see numbers presenting an economic impact of cloud enterprise systems and to compare with a traditional enterprise software stack. Interesting time. Just my thoughts…

Best, Oleg

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