Cloud PLM and SaaS sales mindset

May 22, 2015

cloud-plm-sales

I want to talk about PLM sales today. If you want to succeed in sales, a mindset is a right starting point. But, enterprise sales needs a special mindset. PLM sales is very special case. These days SaaS / cloud software is setting new rules for enterprise software. How does it influence and change PLM sales? What advantages cloud PLM can get compared to a traditional PLM products and sales model?

Few days ago, I posted about how to stop blaming engineers for PLM sales problems? In my view, engineers are on average bad sales people. Therefore, to put engineers in the spot of selling PLM and blame them for wrong articulation of PLM value is a bad idea. There are thousands of books and article on the topic of how to sell to enterprise organizations. It is a good reading for coming Memorial Day long weekend. Today, I want to talk about cloud PLM sales – a new category that has a chance to change the way we sell PLM.

I can see two aspects of cloud PLM sales. First is related to a new reality of our world – internet, online connectivity, social networks, virality. How does it help to sell PLM? It certainly helps to create a new level of awareness about what your product does. If you didn’t setup your product twitter account, blog and other social channel, do it now! But, it doesn’t change a fundamentals. Despite all social channels, selling to enterprise is still very much old-schoolers game. In my view, there is no PLM vendors that discovered a new way to sell PLM until now. You can read more in my earlier post – PLM, Viral Sales and Enterprise Old Schoolers.

Second aspect is related to the fact how PLM companies are managing enterprise sales process and new business models. My attention caught the A16Z blog post – If SaaS products sell themselves, why do we need sales? The article gives you an excellent perspective on the details of sales process. I like the comparison of enterprise sales to the process of getting a bill passed in Congress. Certainly true. Although PLM is not a new category in the market, I would consider PLM sales challenge to create a unique value for every customer as something real PLM vendors are facing every day. PLM sales are competing with many other activities in manufacturing companies and it is literally hard to take it through the all three steps of decision process – why to buy PLM, why to buy PLM from a specific vendor and why to buy PLM now.

SaaS sales are facing the same level of sales difficulties. At the same time I’ve been thinking how cloud PLM can get some advantages over a traditional PLM product sales. And the point of "customer facing activity" form A16Z blog is clearly resonating here. This is a passage to pay attention in my view:

SaaS is a winner-take-all market involving a “land-and-expand” sales strategy. However, landing doesn’t necessarily mean expanding and winning. Staffing your startup with customer-facing resources — professional services, customer support, etc. — at this stage is an investment that will pay off not only in expanding your footprint inside that account, but in building the most powerful sales tool there is: a good reference. And while new clients are great, the best place to sell something is where you’ve already sold something.

You may ask me how is that related? Here is the thing… Landing should be an easy process in SaaS PLM compared to a traditional PLM sales process. And this is where cloud PLM can provide a clear differentiation. A traditional PLM approach is to sell on a premise of changing the way customer is doing business and manage product development processes. When it is done, you can setup PLM system and prove it. But it is a very lengthy process. Opposite to that, you can think about cloud PLM first sale as a "land" process. Do it for the most painful problem customer has. This is why PLM sales should be more technical. Land it to the customer for a cost of zero dollars. After all, you can leverage elasticity of the cloud as a biggest advantage. After you done, work on expand option. New subscription business models will help you to provide a new way for customer – pay per use.

What is my conclusion? Moving to the cloud, doesn’t mean PLM can sell itself. After earlier attempts, it looks like wrong sales strategy. At the same time, landing small feature to solve the most painful problem for a customer can be a right step to start. The challenge is to have enough customer facing resources that can help to discover it and land an initial solution with very low cost and super fast ROI. In my view, it is a completely different mindset from what we had before in PLM and enterprise. It is a time for PLM vendors to retool sales teams with new skills. Just my thoughts…

Best, Oleg

Image courtesy of Kittisak at FreeDigitalPhotos.net


Onshape quietly developed “Google Drive for CAD”

May 11, 2015

onshape-vision

Cloud storage and CAD files. This topic always created lot of controversy and questions. File sizes, speed, security, CAD formats and viewing. At the same time, the need to collaborate and share files is obvious. In my early blog – PLM Cloud Concerns and Dropbox Reality for Engineers 3 years ago, you can find some interesting statistics about how engineers are using Dropbox services. I don’t have updated numbers, but my hunch that usage of public cloud storage services is not decreasing.

GrabCAD was probably the first widely adopted CAD storage and share service. I debated usage of specialized CAD storage and collaboration service – 3 pros and cons to have a special CAD file sharing tool. You can find some more comments in my chat with Hardi Meybaum of GrabCAD.

Onshape cloud storage and collaboration

I’ve been watching recording of . It is a bit long, but if you have time, watch it. Here is a skimmed version with my comments .

Onshape developed a platform that allows users to store, view and collaborate with CAD files. It allows to export and import files, manage revisions, view and edit models and drawings. The list of export and import file formats is not comprehensive yet, but in my view can easy cover the needs of many small and mid size manufacturing shops.

There are 4 main scenarios explained in the webinar – 1/ use Onshape as cloud storage tool; 2/ vendor collaboration; 3/ design review; 4/ access for people with no CAD (viewer). Slides below can be give you some additional explanations.

1-cloud-storage-tool2-collaborate-with-vendors3-design-review-tool4-increase-access-nocad

There are few interesting things that are not obvious in my view if you think about Onshape as CAD tool only.

You can upload and store any type of files to Onshape. Embedded browser viewer is available and you can see them online (you need to convert file into Onshape geometry for viewing). The ability to share and comment on files inside of browser brings “social element” into collaboration. Revisions will help you to keep baselines of files shared with subcontractors.

Onshape’s pricing model can support collaboration. I guess, as soon as somebody with paid Onshape license will share file with you (via email), it will give a free access after registration steps.

What products Onshape is competing with?

Onshape is clearly not the only vendor to support collaboration and storage of CAD files. I just want to mention few of them. I mostly focus on public cloud tools. I’m sure missed few tools, so please feel free to add them in the comments to the blog post.

[Update: 11-May 2015] As expected, I’m getting comments about tools I forgot to mention in this section. So, I’m re-arranging the list. It is alphabetical and will be expanded. Watch for updates…

Autodesk A360 is a cloud project collaboration tool that can support different CAD formats, viewing and collaboration. Navigate here to learn more.

GrabCAD (even after acquisition by Stratasys) is around and after GrabCAD announced Workbench is free, it can be an attractive option too.

Kenesto is an outfit that recently announced the availability of “Kenesto Drive” – cloud tool that can help you to collaborate on CAD files instead of using shared network drive. I’ve been sharing my thoughts about Kenesto here. You can get more info here.

TeamPlatform is a tool that was acquired by 3DSystem. More info is here. It can give you a set of viewing and collaboration capabilities with CAD files.

What is my conclusion? The think I like the most with Onshape is simplicity. The ability to follow Google Drive or Dropbox scenario of File download, Save As, Translate and browser (URL) based model is something you can appreciate if you are doing a lot of work online. Onshape feature set is limited and it is not clear how fast it will grow. It can be a good opportunity to discover what Onshape can give you, but you should consider Onshape beta status. Just my thoughts…

Best, Oleg


Cloud PLM provider check list

April 30, 2015

cloud-plm-checklist

Cloud is everywhere these days. Despite high popularity of cloud solution, I still can see some confusion on the side of a customer trying to make a decision about moving towards specific cloud services. The discussion I had at COFES 2015 earlier this month made me think about key questions you want to ask your potential cloud PLM provider before signing your SLA.

A server, which is connected to the internet is not automatically cloud (SaaS) application. The devil is in details and by understanding specific cloud characteristics you will save time and money for your organization.

Here is a check list you might consider for your cloud provider due-diligence process. .

1- Infrastructure

Most of cloud PLM vendors are not running their own infrastructure layer to bring cloud solutions to you. This is so-called IaaS (infrastructure as a service) layer is pretty important for the architecture of your solution.

Professional cloud provider and partners used for IaaS should be responsible for maintenance of infrastructure layers. Then this partner is also responsible for the entire maintenance of the infrastructure (servers, operating systems, databases, backups, etc.). Patches are published on a weekly basis (usually for good reasons) and this is alone is a valuable service which reduce a pressure on your IT department. The level of availability guaranteed usually lies close to 99.99%; a level which the market leaders in the cloud segment also actually achieve.

2- Maintenance and upgrades

From the perspective of cloud vendor, the maintenance of cloud based apps is much simpler than on-premise solution. User can see it as a clear advantage. However, you should validate how is that aligned with customization and test environment. It can take an interesting turn on your own IT upgrades to leverage the same time frames and also identify the impact you your own company maintenance schedule.

3- Multi-tenancy

This is one of the key things, in my view. Compatibility to multi-tenancy has nothing to compare with the ability to set an environment for many customers. This is about how application architecture was developed in the way to be used by multiple clients. I touched few years ago in my post, which can give you more details.

Essentially, it is separated into two topics – application multi-tenancy and data multi-tenancy. The first will insure all customers are running the same version of the application. It simplifies maintenance for vendor, but bring an additional level of complexity for application and service providers. To insure your environment and data are compliant with a new version takes time and you want it to be very efficient. Data multi-tenancy is a next level. In some cases, you can consider it as non-important. However, after more thoughts, it might be wise to check how multi-tenant application is working with multiple customer databases. It might be too complex to maintain and it might make an upgrade more complicated.

Be aware, multi-tenancy is a key thing in cloud architecture and it require major re-architecture if you speak about existing on premise software. An on-premise solution cannot be made compatible to cloud overnight. Therefore, anyone who is trying to convince you that technology developed back in 1990s runs on both cloud and premise locations might have a great sales skills, but not much technological competency.

4- Security

One of the most often asked question is about security. For the last 3-5 years, cloud providers developed a set of security procedures. Good vendors have them available online in a very transparent way. Ask for a link. If you cannot get one, this is a red no go flag to work with this vendor.

What is my conclusion? Cloud technologies can be very different. But, as a customer, you shouldn’t take blind decision about what are you buying. The most important to understand – you are not buying product anymore. You are buying “service”. SLA is your marriage contract if you will. Whatever is in that contract will define how your PLM system will perform. So, check contracts upfront and look for technological and business differentiations. Just my thoughts…

Best, Oleg

Image courtesy of arztsamui at FreeDigitalPhotos.net

 


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

 


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


PLM PaaS may not happen after all

April 13, 2015

PLM-PaaS-off-target

Platform is such a lovely word. Software vendors like platforms because it gives them an additional capability to partner with a community of developers. In cloud era, platform is often associated with PaaS (platform as a service). For the last few years, PaaS was mentioned as a next step in developing of cloud platforms. PaaS is often seen as a layer (together with SaaS and IaaS) in many marketing cloud slides presented by software vendors. CAD and PLM vendors are using it too.

I put some of my thoughts about PLM and PaaS earlier – Cloud PLM and PaaS dilemma. It is a difficult task to create PLM platform that can be used by other developers. In my view, none of existing cloud PLM products regardless how they call themselves cannot be qualified as PaaS. Will cloud PLM vendors develop PaaS options is a question I asked last year. I don’t think we got any good answer so far.

The usage of word platform and PaaS is often controversial as well as a definition of a platform. Meantime, the bigger world of PaaS ruled by large platform vendors (Amazon, Google and others) are going to rethink PaaS too. TechCrunch article Whatever Happened To PaaS? speaks about some interesting transformations happening with PaaS development by large cloud vendors. Companies are not rushing to provide their strong commitments to PaaS platforms. Here is the passage explaining three reasons why customers are not running towards PaaS and keep IaaS option as preferable.

App Engine’s prices drop regularly, but they’re voluminous and confusing, and a single instance — a pretty puny virtual machine — costs more than a dollar day, not counting storage or bandwidth. Same for Heroku. You get more bang-per-buck by simply buying and running your own servers. You also get enormously larger headaches, and significantly slower development time; but that tradeoff isn’t worth it for many

Then there’s lock-in. Once you build your app atop App Engine’s custom APIs, you’re committed; there’s no easy way to back away and go to another provider. The lock-in is less for other PaaS providers, but it’s still there. There is no universal PaaS equivalent of de facto IaaS (infrastructure-as-a-service) standards such as OpenStack or Docker.

The third, least valid, and arguably most powerful reason is culture. Companies don’t want to give up perceived control over their systems–even if that control is never worth its associated complexity–and sysadmins, understandably, don’t want to evolve themselves out of a job.

In my view, it explains well why PLM PaaS idea may be dead on arrival. The only reason for partners and developers to use platform is cost and speed. If I can spin a new server in minutes and develop my own cloud application, why I should bother with using of PLM PaaS. The potential reason could be data access and interoperability. But it will come down fast to customer lock-in. Openness and interoperability is a big issue in engineering world. Engineers and manufacturing companies don’t like to be locked on a specific software. Even PLM PaaS will provide an attractive set of functionality, I hardly can see how developers of vertical applications and solutions will lock themselves on a specific PaaS and won’t keep an option to provide this solution for other platform and vendors.

What is my conclusion? For the moment, PaaS looks more like a marketing buzzworld used by PLM and CAD vendors. I think vendors will take time to understand what means to deliver cloud platform that will be robust enough not to break under the complexity of multiple vendor dependencies, long development and usage lifecycle and technological innovation. So, PLM PaaS is not here yet and may not happen after all. This is a not for PLM architects to watch technological trends of large vendors and think how to develop future PLM platforms. Just my thoughts…

Best, Oleg

Image courtesy of Stuart Miles at FreeDigitalPhotos.net


Why 2015 will be the year for PLM to rethink cloud?

April 10, 2015

plm-rethink-cloud

I’m coming to COFES 2015 next week, which will take place in Scottsdale, Arizona. PLM and the cloud is one of the topic I’m planing to discuss during the analyst and user briefing sessions. I’ve been thinking to beat a schedule and share some of my thoughts on blog before to spark a conversation.

The last few years have been building some foundation for PLM and cloud. It is certainly became more mature from every standpoint – to understand cloud value proposition, try different business models, discover partnerships and build possible roadmaps for the future. It is different from what we had back in 2010. Cloud is pretty much everywhere these days. Vendors and customers are not asking a question if they need to focus on the cloud, but more about how to do that from different standpoints. Vendors are considering different technologies and ways to build their product differentiations.

The next web article Why 2015 will be the year that the cloud comes of age caught my attention few days ago. I liked a very precise definition of cloud characteristics: self-provision, elastic scale and pay per use. The real cloud solutions are leveraging that part of cloud technologies. Products like Arena and Autodesk PLM360 are probably best examples here. At the same time, it is not clear to me how other PLM vendors are going to fit that definition with technologies and strategies that more aligned with hosting of existing PLM platforms using IaaS platforms or specific hosting providers. You can take a look on my post about where to host cloud PLM.

My favorite passage from the article is related to the ability of cloud technologies to level the playing fields between enterprise giants and small ventures. Here is the passage I specially liked:

“Before the cloud, companies implemented new software and technology in a relatively traditional way through structured, company-wide deployments,” explains John Brennan, head of business development at international communications firm BT. What the cloud brings to the table is versatility that allows end users to invest in the exact resources that they need — no more and no less. Companies can switch over to lightweight, cloud-based deployments that require little in the way of on-premise configuration and management.

Lightweight, cloud based deployment is a key. This is where companies can deliver differentiations. This is where most of PLM vendors can see cloud advantages – to remove IT burden and to lower upfront implementation cost for PLM.

However, expensive IT and on-premise installation is only part of PLM deployment problem. Another part is related actually to the way PLM system is implemented, how it can streamline product development processes. In my view, this is related to a second point mentioned in the article – information exchange.

Today’s top technologies — and human-to-human communications protocols — are dependent on APIs. Thanks to very simple programming, applications can connect to support the swift and efficient flow of information ranging from product SKUs to media buys, CRM data, and credit card transaction details. “Cloud based APIs and microservices simplify information exchange,” says Chris Hoover, global vice president of product and marketing strategy at Perforce Software. “It lowers the barrier for new vendors to enter the market.” The result, according to Hoover, is a trend in which enterprise companies are moving away from a ‘top down’ approach to software and information exchanges.

This is a place where PLM systems are not aligned with a cloud. Few modern cloud based APIs are exposing REST API. However, most of PLM platforms, even hosted in the cloud, still provide only old fashion API frameworks. The level of openness and the way implementations need to be done in an organization is still the same for cloud and non-cloud systems. It is a lengthy process, which requires clarification of requirements and alignment with the organization.

What is my conclusion? PLM industry did a great first step by moving into cloud. Customers are actively engaging with vendors trying to understand cloud technologies and business models advantages. However, implementations are still very painful. So, how to change existing PLM implementation paradigm and make PLM implementations granular and painless. The question is on the table. Whoever, will be able to crack it, has a chance to win a future differentiation game in PLM. Just my thoughts…

Best, Oleg

Image courtesy of renjith krishnan at FreeDigitalPhotos.net


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