Who will build PLM startup on top of Box platform?

April 24, 2015

box-platform

Few months ago, I speculated if Box can become a platform for PLM. Navigate to my previous article to read more details. In a nutshell, it was about aligning Box industry strategies with the opportunity to use Box cloud storage for engineering data.

Business insider article yesterday Box and VCs have created a $40 million fund for startups building on Box’s platform made me think again about the potential opportunity for Box to be a platform for engineering applications. The article is stressing the point of use storage for business applications. Here is the passage from article explaining why Box is looking for startups.

If Box wants to rule the business software market, it needs a lot of people using it. To get a lot of people using it, it needs apps that use it as the storage service on the backend. To get apps that use the service, it needs more startups willing to do it.

So, how to start? Navigate to the following TechCrunch article to learn more about Box development edition. The cost of storage is decreasing and companies like Box are looking how to create future business differentiations.

Box has recognized for some time that cloud storage is a commodity. Knowing that and noting it on stage, the company pressed its various services that it has built on top of storage, like permissions, access statistics and content management. Box Developer Edition is a bet that developers want to integrate storage and file management into their apps, but don’t want to bother with all the hassling details, something that Box has spent significant time and resources figuring out.

More details about Box development edition is here. On the following picture, you can see a possible template for enterprise application on top of Box platform.

box-enterprise-app-pattern-2

Take a look on many enterprise PLM applications and you can recognize similar pattern – groups, folders, content, permissions, collaboration.

What is my conclusion? I like the idea of turning Box towards a platform to build enterprise applications. The barrier to get in the market of enterprise applications is high. Enterprises’ preference to work with large trusted companies is well known in the market. And most of startups are dying because they cannot reach customers. Having investors and neutral horizontal service like Box as a foundation can be an interesting start for new PLM company. Just my thoughts…

Best, Oleg


Onshape, API and cloud architectures

April 23, 2015

cloud-API

I assume you are aware about Onshape, the new CAD software outfit founded by Jon Hirschtick and part of his old SolidWorks founding team. The software is in public beta for the moment. You can reference to my previous posts – PLM thoughts after Onshape public beta and Develop3D live set a stage for cloud CAD competition. I also recommend you Develop3D article – Onshape Beta goes live – start your engines. Navigate to the following link to discover more Onshape resources.

Integration is a very important thing in engineering application domain. Engineers and manufacturing companies are using multiple applications for design, simulation, product data and lifecycle management. Therefore, system architecture and availability of APIs is absolutely important in order to develop integrations and more specific and complex engineering data flows.

Earlier today, my attention was caught by Onshape blog by Steve Lewin-Berlin, which gives you some perspective on Onshape APIs. Onshape is using own APIs to create first integration with Graebert Drawings. Here is the passage from the blog explaining that:

I’ve been leading the development of the Onshape API for the past year. COFES was our team’s coming out party, marking the first public discussion of the API. The introduction of Onshape Drawings and our partnership with Graebert GmbH is an important part of the story.

We decided to build Onshape Drawings on top of the same API that will be available to partners. In a classic case of “eating our own dog food,” we believe that using the API for a significant internal component validates the capability and performance of the API. This also provided a clean interface between Onshape and Graebert technology, allowing us to leverage the extensive technology available in Graebert’s core drawing engine.

As you can see in the screenshot below, Onshape Drawings run in a tab just like Parts and Assemblies, and use a native Onshape style toolbar and command structure.

onshape-drawings

Last week at COFES 2015 I spent some time learning about what Onshape is doing with APIs and integrations. You will be able to integrate Onshape using three different approaches – file exchange, live link using REST API and by creating more complex integrated cloud workflows. Few pictures below can give you some idea about Onshape integrations (apologies for the quality of pictures. I’ve made them in standing room only during Onshape presentation at COFES).

onshape1

onshape-file-exchange

onshape2

onshape3

Onshape is promising to make APIs and documentation available to broader audience later in May.

What is my conclusion? Hybrid architecture and APIs. For the next decade we will live in the world of new cloud apps and existing desktop tools. I can see people starting to use new cloud services in parallel with existing design applications. Openness will be even more important than before. It is critical to follow open integration architecture and REST APIs to support a mix of required integrations. Just my thoughts…

Best, Oleg

Image courtesy of Danilo Rizzuti at FreeDigitalPhotos.net

 


Will Aras pave the road to PLM heaven?

April 22, 2015

plm-heaven

I’m following Aras PLM annual event online this week – ACE2015. There is a moderate volume of tweets coming from Detroit. Navigate to the following link to have a look. You can take a look on the agenda here.

For the last few years, Aras is developing as a very interesting story. Do you remember my post back in 2011 – Aras PLM lines up against Windchill, Enovia, and TeamCenter. If you listen to updates coming from Aras, this is actually coming truth and I’ve seen presentations made by few customers explaining how Aras is replacing existing PLM implementations or co-exist with PDM implementations from Enovia, TeamCenter and Windchill.

The following slide caught my attention yesterday. It was part of Sonnax presentation at ACE2015. It gives an interesting definition of PLM nightmare vs. PLM heaven.

aras-plm-heaven

PLM Nightmare

Spreadsheets, Workflow software and Activity database. I can see a point of spreadsheets. Especially after my yesterday blog referencing complex automotive configuration environment made of Excel. However, the sense of nightmare with workflow software and activity database was a new thing for me. If I think about each PLM software, workflows and activities is an essential part of every PLM platform. My hunch is that PLM workflows are complicated and hard to implement. And it makes terrible experience for users.

PLM Heaven

Flexible, accessible by all and dollar doable. I found this combination interesting. It clearly shows the level of concern manufacturing companies have with software licenses cost. Flexibility is something that often associated with spreadsheets, but I can see a point of configurable flexible data models. Accessible by all is the most important. And this is, in my view, it is a combination of technology and license cost. Cloud, web and mobile are technologies that can make PLM software accessible. However, it should come in the package with business models allowing to all parties to be connected.

It made me think about accessibility of PLM solution as a key component of a successful PLM software. PLM software must be available to every person in manufacturing companies and connected eco system of suppliers, contractors, service providers and (probably) customers. Without that, PLM will be in a danger to stay a database of engineering change workflow and manage revisions of CAD files.

What is my conclusion? Aras is using tagline “Rethink PLM“. Actually, I like it very much. Coincidentally, I posted about it – Cloud is not the way to rethink PLM. Then what? We can see lot of disruption these days in many industries – communication, transportation, connected devices, home automation, mobility. So, rethinking will be coming to PLM too. But, the meaning of “rethinking” is tricky and should be filled with clear differentiation supported by 10x better technologies, new business models and use experience. Just my thoughts…

Best, Oleg

Image courtesy of Master isolated images at FreeDigitalPhotos.net

 


The role of Bill of Materials (BOM) in PLM competition

April 21, 2015

trucks-scania-man-vw

It is hard to overestimate the value of bill of materials (BOM) in product design, engineering and manufacturing. It is everywhere – product design and configuration, engineering, manufacturing, operation, etc. BOM is equally important and complex. In my earlier articles, I touched multiple dimensions of BOM complexity – disciplines, product lifecycle, changes. PLM vendors are focusing on high level of integration of product information into development process. Few months ago in my article When BOM is not BOM, I touched some of aspects of BOM complexity and how it related to BOM ownership, BOM errors and future battle for MBOM ownership between PLM and ERP.

Actually, the battle between PLM vendors for superior BOM solution can be even more interesting. Engineering.com article – Volkswagen’s Epic Challenge to synchronize PLM for its Truck Brands brings a very interesting story about German automotive giant trying to unify PLM solution across its commercial vehicle brands. Take some of your lunch or evening time and read the article.

The example of Scania brings up the value of well integrated PLM solution to support vehicle configuration and manufacturing.

The secret to Scania’s success is a sales model where product development and modular manufacturing processes are interwoven with sales into a holistic system. The company is known for its tailor-made vehicles. Scania’s PLM plays a big role in its business model. Scania uses Dassault’s (DS) CATIA V5 while ENOVIA V5 serves as the CAD vault. PDM functionality is handled via Scania’s proprietary OAS platform which defines the rules for how the components can be assembled. The OAS works as a product database, configuration and structural control solution. CAD geometries are downloaded from the ENOVIA CAD vault in accordance with the configurations delivered by OAS. In terms of the eBOM and the mBOM, it’s once again about OAS and its couplings to ENOVIA. The company’s manufacturing solutions can’t handle many variations; you have to prepare one at a time and make them individually for each truck.

For some your it might be a big surprise, but according to the article, Excel is a key element of PLM solution used by another vehicle manufacturer. MAN is using Excel based technology to work with EBOM and MBOM.

MAN uses both Dassault’s CATIA V5 and PTC’s ProEngineer/CREO. After a succesful pilot last year that considered product development (ie, not production), the company chose PTC’s PDMLink (part of Windchill) for their CAD vault and PDM system. Configuration and structural control is principally handled via an Excel Integration with PDM Link. The eBOM (engineering BOM) and the mBOM (manufacturing BOM) are produced by PDM Link via the Excel integration, picking up the parts from the CAD vault. The implementation of PDM Link is under way but at a low speed in anticipation of a final PLM decision.

The story of MAN and Scania made me think about importance of BOM management in complex product configurations and vertical integration with manufacturing. Build to order or engineering to order environments are extremely complex and require fine tuned integration between engineering bills, configuration parameters (features) and ability to translate it into manufacturing and as-built environment.

Here is my favorite passage from engineering.com article which put nail in the head of BOM importance.

BOM management issues will be the most crucial and will determine the direction the company takes. Regardless of what VAG decides to do, the gains that can be made through sharp, highly automated BOM creation and MDM (Master Data Management) solutions is significant. The advanatge of an MDM solution is that it connects the PLM, MES and ERP systems into seamlessly functioning IT units for the shop floor and manufacturing.

What is my conclusion? Platformization is one of the trends in modern PLM according to CIMdata. The example of VW shows an importance of BOM management in order to provide robust and scalable PLM solution for complex automotive manufacturing. My hunch BOM will become one of the most important weapons PLM vendors will be using to differentiate future PLM platforms. Just my thoughts…

Best, Oleg


COFES 2015: PLM and the cloud briefing

April 20, 2015

plm-cloud-adoption

Last week at COFES 2015, I shared my thoughts and opinion about what happens between PLM and the cloud for the last few years. That was a teaser of my COFES session in the agenda:

As recently as three years ago, the cloud was viewed as a differentiator for some PLM vendors. The PLM world was divided between those who viewed the cloud as “the future” and those who viewed it as a fad. Today, most PLM vendors touch the cloud or engage with it in some way. But… what has really changed? Where do we stand with the big questions/challenges with PLM? Can the cloud still be the source of a competitive differentiator for PLM vendors?

Cloud is an outcome of web technological revolution of 2000s. Consumer web applications and social networks provided great user experience, open source technology and taste of new business models. In many situations, we experienced better performance, usability and robustness of consumer applications compared to our business solutions. Which basically set all enterprise CIOs on fire from 2010 to deliver new enterprise solutions.

But cloud is not only about technologies. It is also about transformation in business models. We can see a shift towards SaaS applications with subscription models and variety of innovation in different business models – pay for storage, pay for use, references, etc.

Manufacturing companies are looking for new PLM business models, which can allow them to have sustainable licensing mechanism to grow, remove upfront cost and deliver “less expensive PLM” to existing and new users.

Enterprise software discovered SaaS applications and cloud too. Salesforce.com was pioneering so called “no software” paradigm from early 2000s. In manufacturing and enterprise, Netsuite is another example of software vendor using cloud as a strategy. Bom.com (later transformed into Arena Solutions) was a first on-demand application providing PLM related functionality. Windchill and Agile PLM software are also examples of PLM products experimenting with hosting and on-demand delivery.

plm-cloud-history-2015

The revolutionary step was done by Autodesk PLM360 in 2012. Autodesk was not engaged with PLM activity until that time. It was even famous for anti-PLM rants. However, in 2012, Autodesk introduced PLM 360 (built on top of Datastay acquisition), which became a game changing trigger for PLM industry. Since 2012, we can see an increased trend among PLM vendors to adopt cloud strategy.

Below is a slide deck summarizing my PLM and the cloud briefing. It provides few more details, so take a look.

Cofes 2015 plm and the cloud briefing (public) from Oleg Shilovitsky

What is my conclusion? Few things are clear today about PLM and the cloud. It is obvious that cloud is not fad and it removes significant IT headache to install, configure and maintain PLM. With cloud option, you can start PLM development almost instantaneously. However, PLM implementations are still hard. What is not clear is the future cloud PLM adoption trajectory. Manufacturing companies made significant investments in existing PLM installations and implementations. What ROI can trigger their decision to move into cloud PLM? There is an opportunity for companies that never engaged in PLM, to start with cloud PLM as a more efficient and easy way to adopt PLM. However, the implementation phase is still painful for many customers. Therefore the main question for me is what can bend future a curve of cloud PLM adoption. Just my thought…

Best, Oleg

Image courtesy of Pixomar at FreeDigitalPhotos.net


COFES 2015: Product Lifecycle, Supply Chain and Data Networks

April 17, 2015

complexity-product-data-supply-chain

I had a chance to share my thoughts about complexity of product lifecycle in supply chain at COFES 2015 Design and Sustainability symposium. Manufacturing companies and software vendors are facing new enterprise reality these days – distributed environment, connected work and cloud software. On the other side we have skyrocketing complexity of products. Each product is a system these days. Think about simple activity tracking device. It is a combination of hardware, mobile application, cloud data services, big data analytics and API to work with partners. The complexity of modern luxury car is 100M line of software code. Think about product information changes in the system which is combined from engineering, customer, field support and connected devices working together.

Product data complexity is introducing new level of challenge in front of software vendors. I think it is a time for software vendors to think how to break limits of existing PLM architecture to support a level of complexity demanded by manufacturing environment and complexity of products.

So, what to do if a single database approach is dead? Federated architecture was one of the approaches PLM vendors used in the past (Actually, I think, this is probably the only one that works in production for very large enterprises). But this approach is expensive in implementation and requires too much “data pumping” between silos. Opposite to that, an experience of some companies with network based data architectures shows some promising results.

COFES 2015: Product lifecycle, supply chain and data networks from Oleg Shilovitsky

What is my conclusion? The growing complexity of manufacturing environment and products creates the demand for new product lifecycle architectures. These architectures will be able to support management of multidisciplinary product data (mechanical, electronic, software) and will operate as a global distributed data network. Just my thoughts…

Best, Oleg


Can we see CAD-PLM unicorns on a horizon?

April 16, 2015

3d-unicorn

I’m on my way to COFES 2015 – annual gathering of people discussing a future of engineering software in Scottsdale, Arizona. It made me think about an intersection of startup and engineering software world. Last year I shared my thoughts about a potential surge of CAD / PLM startups driven by new cloud technologies, web, open source and multiplied by large amount of unsolved problems in engineering software such as globalization, slow ROI, complexity and cost. So I want to continue a startup theme today.

My attention was caught by article by Dave McClure – Bubble, My Ass: Some Unicorns Might Be Overvalued, But All Dinosaurs Gonna Die. Article speaks about Unicorns – an unofficial term used to call a startup with valuation greater than $1B. According to recent WSJ article, there are 82 startup companies in the world with such valuation. You can see companies from consumer and enterprise space there. The following picture (from 2013 TechCrunch article) can show you the split:

2013-unicorns

My favorite part in Dave McClure’s article is actually related to a great summary of reasons why Dinosaurs companies are going to die – 1/ Dinosaur companies don’t innovate; 2/ Dinosaur Companies have a tough time recruiting & retaining top technical talent; 3/ Dinosaur Companies don’t get how critical internet marketing is becoming. The following passage is my favorite:

Fundamental to all of the above is the following observation: most public companies have not taken to heart how absolutely mission-critical software technology & internet marketing have become to business competitiveness. Thus, almost every Dinosaur Company is extremely vulnerable to a Startup Unicorn eating their lunch (stated so eloquently this past week by none other than JP Morgan Chase CEO Jamie Dimon).

You cannot spot engineering and manufacturing software companies in these lists. However, we can see few companies that can be associated with enterprise software business and used by manufacturing companies – Dropbox, Box, Tableu, Workday, Palantir. The largest valuation of CAD / PLM startup that was mentioned recently was $295M for Onshape – here is the Fortune article mentioning that:

Onshape, a Cambridge computer-aided design (CAD) software startup, has raised a total of $64 million in funding from New Enterprise Associates, North Bridge Venture Partners, and Commonwealth Capital. The funding values the company, which has operated stealthily for the past three years, at $295 million, including the funding.

Here is a question to think about. Can engineering and manufacturing software industry create a unicorn startup in the next decade? As a reference you can take a look on available information about market capitalization of some CAD / PLM companies – Dassault Systemes ($16.1B), Autodesk ($14B), PTC ($4.26B). But these are public companies with 20+ years of lifetime. At the same time, I’m not aware about any startup company in engineering software domain that has revenue close to $100M. According to latest CIMdata analytical researches, PLM market (which includes CAD business too) grew up 6.8% to $37.2B in 2014. Onshape is probably the only company on a horizon that (based on funding and buzz it created) can think to be a unicorn in the future. However, Onshape is still very early in the lifecycle and it is hard to predict its future trajectory.

What is my conclusion? From traditional engineering software viewpoint, it is hard to see how CAD / PLM industry can bring a new company that will be valued with $1B in coming 5-10 years. However, here is the thing…. Look on companies in the list of unicorns. Many of them made a transformation in the traditional industry landscape (transportation, hospitality, communication). That was the main reason for their premium ($B) valuation. Until now, CAD companies made CAD and PLM companies made PLM in the way we knew that for the last 15-20 years. The future might be different. Just my thoughts…

Best, Oleg

Image credit GrabCAD


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