“True Cloud” Solution and PLM Competition

July 2, 2011

CAD, PLM and engineering software world is very competitive. Time ago, CAD vendors competed on the number of features. It is not unusual to see lists that comparing features and functions. However, nowadays the competition on features becomes useless. In the era of iPad apps and Web 2.0, you can just say that this application isn’t cool enough :) . I’m almost not following competitive conversations online, and you can rarely see such a type of topics on my blog.

The following Vuuch blog article struck my attention – Vuuch is the first "true cloud" PLM application. Take a time during your 4th of July long weekend and read this article. My good fried, Alex Neihaus is taking the conversation to the level combining some competitive statements mixed with really geeky and cloud language. Here is my favorite passage from this blog:

…despite lots of strategy talks with customers and high-concept keynotes at user conferences from the big PLM vendors, the first company across the finish line with a true cloud application for the PLM community is Vuuch…

…To be a true cloud app, it’s not enough to have a web portal that users access. That’s what Gmail is. Instead of your messages being stored on an internal server behind a corporate firewall, they are stored on Google’s servers. Big deal. That ain’t what we call cloud. To really be a cloud app, the application must have an API that can be called remotely. That is, it must not only have UI, it must be callable from other applications, using cloud technologies…

I found this definition a bit shocking and decide to provide some clarification about cloud technologies that can help to readers to translate this from geeky to normal.

Cloud Computing in Various Forms

First of all, I’d like to point readers to Wikipedia’s article about Cloud Computing. It is educational and provide a comprehensive analyzes of multiple aspects of cloud applications.

Cloud computing refers to the use and access of multiple server-based computational resources via a digital network (WAN, Internet connection using the World Wide Web, etc.). Cloud users may access the server resources using a computer, netbook, pad computer, smart phone, or other device. In cloud computing, applications are provided and managed by the cloud server and data is also stored remotely in the cloud configuration. Users do not download and install applications on their own device or computer; all processing and storage is maintained by the cloud server. The on-line services may be offered from a cloud provider or by a private organization.

Modern development of cloud qualifes three levels of cloud based solution – SaaS, PaaS, IaaS.

SaaS (Software as a service) is a software deployed over the internet, available to the end user as and when wanted. It is also called sometime "software on demand". Payment is per-usage or subscription. SaaS can be considered as the oldest and mature part of cloud computing. Examples of SaaS are salesforce.com, Netsuite, Google Gmail and some others.

PaaS (Platform as a service) is a combination of a development platform and solution stack delivered as a service on demand. It provides the infrastructure that can be used to build a new software application or extend the existing ones without underlying cost of buying and deploying additional hardware and software. Sometimes, PaaS is used to extend the capabilities of existing SaaS solutions. Examples are Force.com (from Salesforce.com); Google App Engine and Microsoft Azure.

IaaS (Infrastructure as a service) delivers computer infrastructure, typically a platform virtualization environment. It includes service, software, data-center and network equipment available as a single bundle. The best known IaaS environments are Amazon EC2 (Elastic Compute Cloud) and some others.

PLM on the Cloud

The idea of PLM on the cloud isn’t new. The first company pioneering cloud deployment in PLM space was Arena Solution (former Bom.Com). Nowadays, vendors are talking about cloud solutions. I can see different PLM vendors are taking various strategies related to the cloud. Among 4 main companies in this space, Dassault is leading with their cloud offering based on utilization of AWS and placements of V6 platform on EC2. Autodesk strategy seems to be interesting too. On one side, Autodesk Buzzsaw is a mature application service (SaaS – according to classification above). On the other side, Autodesk is trying "cloud water" with multiple applications – some of the utilize cloud infrastructure (i.e. Amazon EC) and some of them are focusing more on mobile (AutoCAD WS). Siemens PLM and PTC are more neutral in this cloud game. Vuuch, as I learned from Alex Neihaus’ blog, is now joining PLM on the cloud race.

What is my conclusion? Competition is a tough thing. Especially, when it comes to technology. Customers are not interesting in technologies and more focused on applications these days. I’m a very happy customer of Google Apps and I don’t care if Gmail is "true cloud app" or "false cloud app". I see PLM and engineering software lives in the world of SaaS. Efficient leverage of PaaS and IaaS can be PLM cloud apps successful. Just my opinion, of course. YMMV.

Best, Oleg

*pictures are courtesy of Wikipedia and Vuuch blog

Leave a Comment » | Daily PLM Think Tank | Tagged: , , , , , , , , | Permalink
Posted by olegshilovitsky

PLM Collaboration and SaaS Wake-Up Call

January 18, 2011

I read on Forrester Blog about acquisition of Dimdim by Salesforce.com. T.J. Keits of Forrester is discussing various aspects of Dimdim advantages as well as Salesforce acquisition details. Last year, I had a chance to try out Dimdim and I found the environment very convenient. The following characteristics of Dimdim mentioned as very complimentary to Salesforce’s Chatter released earlier – tools for social collaboration. Here is the quote from T.J. Keits blog:

Dimdim’s real-time communications technology fleshes out the collaboration story Salesforce began with its social offering, Chatter, last year. This blending of tools will boost the collaborative power of some key Chatter features:

  • Profiles. On its own, this social tool is the foundation for information sharing and expertise location in an organization. Users can post information about themselves and their job and associate their profile with certain shared information in a searchable format. With added conferencing capabilities, employees can locate an individual and start a meeting with them, allowing the parties to communicate and jointly view data in real time.
  • Groups. Salesforce’s turn on team workspaces allows employees to share information and work together in a central location. Unlike a team space in SharePoint or Lotus Quickr, though, there was no integration with any tools that would allow for synchronous interaction. With the inclusion of Dimdim’s conferencing tools, information workers can now communicate within the context of the team space, allowing for real-time collaboration within a workflow.
  • File sharing. This is a recent addition to the Chatter offering, but an interesting one because it allows for content sharing within their activity stream. Of course, the real potential of this will be unlocked when the option to start a web meeting is included with that shared document, allowing a worker to start a live discussion with the individual who posted the content.

PLM, Social Collaboration and Platforms

Vendors in PLM space put a significant emphasize of “social aspects” of collaboration. Social Link of PTC, Social Innovation of Dassault and some others are best examples to present an interest of PLM vendors not to lose “social aspects”. However, none of PLM vendors didn’t decide to have a core collaborative functionality as part of their own portfolios. Most of the work PLM vendors are doing was about integration of existing collaborative features and platforms (i.e. SharePoint etc.).

What is my conclusion? Salesforce presented an interesting case related to the acquisition of platform capabilities. In my view, this is a very logical step in the future development of Saleforce’s platform. What it means for PLM? In my view, it makes Salesforce more competitive. Some of PLM vendors are thinking about their cloud / SaaS offerings. The wake-up call for owning some fundamental technologies can be too late. Just my thoughts…

Best, Oleg

Leave a Comment » | Daily PLM Think Tank | Tagged: , , , , , | Permalink
Posted by olegshilovitsky

Manufacturing Companies and SaaS Business Opportunity

January 11, 2011

I had a chance to watch Jason Green’s video interview by TechCrunchTV Sarah Lacy. Take a time, watch and make an opinion. I found interesting to listen to Valley VC, which is strategically focusing on cloud and enterprise opportunities. This is not a common trend, in my view.

Take a look on the following video.

This is not a first time I’m writing about a cloud opportunity in the manufacturing market. Navigate your browser to few of my following “cloud posts” if you had a chance to miss them: PLM and Cloud: Hold the Promise? and PLM and Pragmatic Cloud- Do Less. However, this video made me think about few interesting trends I wanted to share with you.

B2B and Cloud Services Trend
One of the important trends I can see in the enterprise cloud market is the development of B2B cloud services. Why it is interesting, in my view? It provides an alternative way to just pushing enterprise customers with enterprise product suites converted to the “cloud or SaaS model”. Business Services can become an interesting and disruptive approach for enterprise market.

PLM on the Cloud
I have a mixed feeling about PLM and Cloud. Definitely, few mindshare vendors already made (or planning) to make plans for cloud offering. The top two companies here are Autodesk and Dassault. In the past, PLM industry had few companies moving towards SaaS/On Demand. Arena Solutions as well as PTC/IBM bet on their future with Cloud/SaaS infrastructure. The biggest problem I can see in this domain is the replication of existing products, portfolio and plans to the cloud. This is not how I can see manufacturing and engineering software need to be developed.

Bottom Up Approach
I can see an interesting opportunity in development of manufacturing services, which has an opposite philosophy to the current mindshare PLM and ERP vendors. Existing enterprise and PLM models are very top-down oriented and assume a significant agreement about how a system needs to be implemented and how data need to be managed. Development of business services can be an interesting approach to provide an alternative solution on the market.

Freemium Business Models
Another aspect of SaaS and Cloud business is in implementing new  business models. Freemium is one of them. Normally, people see “Free” as an option that can be used only for a consumer market. The complexity of enterprise implementation and high potential cost of free services, it seems to be a wrong option. However, I can hear Jason is talking about 10-15% convergence rate in enterprise freemium models. It can shake business modeling canons and create a significant opportunity in the market.

What is my conclusion? Thinking about PLM Reset 2011, I can feel it is a time to re-think common practices of SaaS applications. Companies have tried to replicate existing software and shift the delivery towards the cloud. This is a wrong approach. The biggest potential of cloud will be in the combination of new approaches, technology, delivery and business models. Just my thoughts…

Best, Oleg

Leave a Comment » | Daily PLM Think Tank | Tagged: , , , , , | Permalink
Posted by olegshilovitsky

Collaborative PLM and Oracle 2011 Targets

January 3, 2011

I’ve read the following article Oracle butts into online collaboration space with Cloud Office. It struck me as something important. Forget about Google vs. Microsoft online wars. It seems to me Oracle is not only thinking about Fusion Apps, but started to understand the value of seamless collaboration on the level of documents and spreadsheets. This can be an interesting move. Oracle announces Cloud Office. Here is what written on Oracle website:

Oracle Cloud Office is a Web and mobile office suite. It includes word processing, spreadsheets, presentations, and more. Based on Web open standards and the Open Document Format (ODF), Oracle Cloud Office enables Web 2.0-style collaboration and mobile document access and ensures compatibility with Microsoft Office file documents. Oracle Cloud Office is integrated with Oracle Open Office, which enables rich offline editing of complex presentation, text, and spreadsheet documents.

I found the following video interesting:

You can get some more information from Oracle Cloud Office data sheet. The following picture caught my interest. Oracle Cloud Office SaaS architecture.

Oracle PLM portfolio

Oracle’s PLM-related story includes few interesting facts that, in my view, need to be pulled together. After Agile PLM Software acquisition in 2007, Oracle boosted their PLM capabilities. In addition to Agile, Oracle also acquiredCimetry Systems – a provider of AutoVue viewer and collaborative application. During the last few years, I can see a constant effort from Oracle to develop PLM-oriented business apps as part of Oracle Fusion technology and strategy.

What is my conclusion? I think, Oracle focus to the collaborative application in style Oracle Cloud office , can be an interesting benefit for PLM implementations. The amount of Excel spreadsheets in PLM is huge and growing. The ability to handle them as part of the Oracle portfolio can provide some benefits to companies already paying a lot to Oracle. However, it might not bring new PLM customers to Oracle and they will follow Microsoft SharePoint PLM path. What is your opinion?

Best, Oleg

4 Comments | Daily PLM Think Tank | Tagged: , , , , | Permalink
Posted by olegshilovitsky

PLM Innovation and Packaging Trajectories

December 18, 2010

Innovation is a popular word these days. It sounds modern and trending. Everybody wants to jump to this bandwagon. I found myself reading and listening a lot about innovation during last time. The best book, I can recommend you is Peter Druker’s bestseller – Innovation and Entrepreneurship. It was re-printed many times. You can buy one on Amazon for a price less than one buck. However, the book is exceptional.

I spent Thursday listening and talking about innovation in engineering software during COFES Israel Forum in Hilton Tel-Aviv. You can get an idea about who attended by navigating your browser to COFES Israelwebsite. Brian Shepherd of PTC brought the idea of packaging in PLM. It made me think about some interesting trajectories related to the innovation in general and more specifically in PLM.

Packaging and Roles

The idea is to split application into pieces and providing different applications to people in a company. It sounds to me as a blend of the old “role-based” portfolio and trending App Store ideas. The fundamentals of this model are very healthy, in my view. However, the execution of this “re-packaging” is mostly important. The ability of apps for inter-play and exchange information is one of the most critical aspects. The second will be usage of heterogeneous Apps coming from different vendors. As you can see the backside of flexible packaging is the same data problem. PTC has something called Common Data Model. You can listen Mike Campbell of PTC is speaking here about Creo Common Data Model. It will be interesting to see how it will be different from Dassault V6 platform.

Enterprise Open Source

Another idea how to charge people for PLM in a less painful manner. Aras Corp. is leading this PLM innovation. You can get PLM software for free – no associated license cost. However, you will be able to get extra services by paying maintenance, subscription and services. This model, re-package a very complicated PLM sales process as well lower entry barrier. An additional aspect of this innovation is to prove software maturity by enabling people to run free download and evaluation. The last is only half true, in my view. Yes, you can download for free. However, your organization time is not free. In most of the situations, you can have a free PLM software for evaluation from other PLM vendors.

Services

This business model started many years ago as ASP model. Later, it was renamed as “on-demand” and SaaS. Now this model is associated with so called “cloud” platforms. The leader of SaaS offering, San-Francisco based Salesforce.comis selling the software by charging service money per month/year contracts. PLM early innovators in this space is bom.com (later re-branded as Arena Solutions). To sell services is an interesting approach and provide some financial benefits. However, PLM by nature removes one of the most strong advantages of SaaS model – flexibility to stop service at any time. At the time your data will be locked into PLM database, you need to pay to both providers until you will transfer your assets in an alternative system.

What is my conclusion? Reading the same book by Peter Druker, you can find, innovation may happen in different places. Product, Technology, Services, Business Processes, Logistic and Business Model. Edward Lewis from Hollywood fairy tale Pretty Woman is buying up businesses to break them up and sell them off in piece with a profit. It is hard to sell large PLM Platform these days. PLM vendors are trying to find an alternative model, which will be more successful in 2010s. Services, Open Source, Re-packging – all these models have one single root – to find an appropriate way to match customer needs and product offering. The innovation is in a business model. However, the simplicity of products is probably the key to success.

Best, Oleg

1 Comment | Daily PLM Think Tank | Tagged: , , , , , | Permalink
Posted by olegshilovitsky

Cloud PLM and Small Manufacturers Survival Plan

October 1, 2010

While big OEMs are very visible, the majority of manufacturers are represented by small companies. The numbers are different in US and Europe, but my guess is that the number is in the range of 65-75%. How to address the need of these companies in coming years? This is one of the questions that frequently asked by many industry reviewers. One of the conclusions made after multiple conversations about Open Source PLM is that OSS will not become a silver bullet for small and medium size manufacturers. So, if OSS is out of the game, what if Cloud PLM can be a survival plan for a vast majority of small companies in manufacturing domain?

Cloud Computing and SME
I read an article in ComputerWeekly.com named Cloud Computing to explode SME market. Have a read and make your opinion. The article summarize opinions coming from 360 IT event that took place in London a week ago. I found few very interesting opinions about the role of cloud computing in SME market. I put few quotes below:

Cloud adoption could become more widespread in the small business sectorthan in larger organisations, said experts speaking at the 360IT event in London….”There are so many businesses already using Google services. Cloud services are the only way in the medium term for these businesses to access enterprise-class robustness and service. It will be huge,” he said. [Gregor Petri, adviser at CA Technologies.]….But Errol Rhoden, director at OEM Solutions, said security would remain an issueunless service providers do more to gain customers’ trust.

PLM Cloud Switch?
PLM was born for big companies to provide solutions to handle product development processes and lifecycle of design, engineering and manufacturing information. The complexity of this information is very high. For the last couple of years, I see a definite trend of software vendors to find alternative solutions for smaller companies. It comes in multiple forms – providing industry vertical practices, packaged out-of-the-box solutions and many others. Cloud (or OnDemand) business was considered problematic. Few companies experienced in PLM on the cloud and, in my view, didn’t find how to switch PLM into a cloud mainstream road. So, what changed now? In my view, small manufacturing companies will try to cut their IT costs by moving their infrastructure and computing assets to external cloud providers. PLM software vendors will be able to bundle PDM and PLM application into hosted IT stacks.

What is my conclusion? Small and medium manufacturers are experiencing tremendous pressure on how they optimize their information infrastructure and reduce IT costs. At the same time, they have an increased need to optimize their product development work. Massive movement of IT services to cloud can create a second chance for PLM software vendors to come with new type of solutions adopted to changed cloud environments. Just my thoughts…

Best, Oleg

2 Comments | Daily PLM Think Tank | Tagged: , , , , | Permalink
Posted by olegshilovitsky

SaaS PLM – New, Complex, Expensive?

September 21, 2010

Last week I had healthy debates with one of my blog readers about different options to deploy PLM for the small manufacturing companies. Here is the part of this conversation

[...yet SaaS PLM presents a difficult decision for most engineering managers. "Do I want to have my company data hosted off-site or on-site?" The primary reason for answering "yes" is the perceived complexity of managing a PLM on-site. So we directly address that complexity, and give them a simple product - available as a subscription, if that's also an important benefit - which lets them keep their mission-critical data under their direct control. I'm sure it won't shock you that we also have a web page devoted to the on-site versus off-site debate: http://www.buyplm.com/best-plm-software-license-decision.aspx ...]

I recommend you to have a look of PDXExpert PLM website and make your opinion. The following passage is actually very interesting:

SaaS is new & complex… and complexity is expensive. On-demand PLM moves your product data into an off-site facility with out-sourced IT resources. The PLM application service provider (ASP) lets you to rent, rather than buy, your software as a service (“SaaS”). Your data is hosted off-site (in the “cloud”) where details like physical location, update schedules and network infrastructure are hoped to be irrelevant.

My experience with cloud applications in consumer space is slightly different. Almost all my moves to “cloud-base” option was driven by reducing of complexity. I can bring some, pretty obvious, examples. Migration from Microsoft Office to Google App allowed me to reduce a complexity of dealing with Microsoft Outlook, to forget about the complexity of handling Outlook pst and other local files. My files and emails are available now for every device in a seamless manner. Another case is Evernote. Previously, I used Microsoft Office tools. Evernote allowed me to capture notes simultaneously on multiple devices, synchronize them between devices and making them available for me at anytime. My last example is dropbox. I’m using dropbox for short time file sharing and exchange information between different devices. USB stick was a previous solution. Now, I can drop a stick in favor ofDropbox. No hassle, I shouldn’t care about USB sticks, viruses coming from Windows and can access it from multiple devices.

What is my conclusion today? The idea of SaaS is not new. We used to call it ASP, Hosted, OnDemand… Today it comes as SaaS. Some PLM vendors tried this option before with more and less success. Can we make a conclusion about SaaS PLM cases today? I think, it is still too early to drive a simple decision. Massive influence of consumer internet software, in my view, will influence individual and company decision makers towards SaaS solution. I’m interested to know what is your opinio and experience.

Best, Oleg

*Picture credit of The Hindu.

Leave a Comment » | Daily PLM Think Tank | Tagged: , , | Permalink
Posted by olegshilovitsky

What Are Demands for “PLM on Demand”?

May 27, 2010

Thanks to David Isenhower  for twittering a very interesting whitepaper from Siemens IT. The name of the paper is Software as a Service (SaaS) with Sample Applications. Yesterday, I was able to get this whitepaper without any registration using this link. One of the sample applications discussed in this paper was Siemens “PLM OnDemand” TeamCenter. I believe, this is a sort of visionary evaluation, since I never heard about existance of “PLM OnDemand” TeamCenter before. However, as it seems to me, author is discussing more demand rather than the available solution and presenting the view of Siemens IT on what should be the future implementation of PLM on demand.

It made me think about how PLM can be delivered on demand. I took the proposed vision of PLM on Demand from the whitepaper mentioned above and compared it to PLM Think Tank visionary proposal.

PLM on Demand: PLM “ready to use” industry solutions.
This is a short vision for Siemen’s IT vision. The white paper defines PLM as one of the conservative areas. Companies are always concerned about investments that need to be done in PLM project. It defines a potential demand for new type of PLM solution.

CIOs may see an opportunity to decrease the overall cost of PLM solution by moving to the cloud as On-Demand Services. “Companies are always less ready and willing to bury valuable developer resources in PLM projects for months. In no other corporate process is the wheel reinvented as often as with PLM, leaving significant potential idle at the same time“. Later, in more detailed way, it explained as “…As a special multi-tenant enabled SaaS solution, PLM on Demand bundles PLM industry solutions with high-quality operation and service in a package with a usage-based price model. Options enable the package to be adapted to individual business requirements. PLM on Demand is not only a new financing and operation model however.  It primarily involves the provisioning of a preconfigured PLM application tailored to the needs of an industry. The “price” for this advantage is that the scope of freedom for individualized customer configurations is limited…“.
In addition, I see the mention that PLM solution needs to have a specific industry orientation: “…the solution offered must also actually cover the typical business requirements of the sector. This depends significantly on the sector and process know-how of the provider…“.

Alternative: PLM Marketplace On Demand
Since, I’m taking a role of “Devil Advocate” on PLM Think Tank, I’d like to introduce an alternative version of how to get into Product Lifecycle Management solution on demand. I have to say that I share Siemens’ vision about demand for low TCO solution that may solve problems of manufacturers. However, I see the future in a different direction. The way the solution can be developed will be as following:

Cloud Based Data Storage
The economy of scale can propose a more efficient solutions to store and manage data online. Design, Bill of Materials and other data can be stored on cloud and easy distributed to customers. When typical corporate email storage varies between 500MB to 1TB, cloud can offer enough data to accumulate product and manufacturing information. Just compare it to 8-10GB of Google Mail storage. I believe very few companies will build new data centers in 2010s, so to move data into the cloud will become more natural.

Application Market Place
One size doesn’t fit all. I believe manufacturing represents a special kind of “long tail” and requires a granular set of solutions to solve their problems. If I’m looking on marketplaces proposed by Saleforce.com, new solution places developed Zoho and vision of Google Market Place, I can see it as a potential way to develop on demand services for manufacturers.

What is my conclusion? The PLM story on demand is still not discovered. I think, Siemens IT made an interesting try to present a potential for PLM on demand. It can be a choice for a big company. However, in this case, I don’t see how it will be different from delivery on premise solutions we have today. I’m looking forward to your comments and thoughts.

Best, Oleg

Share

2 Comments | Cloud Application, Daily PLM Think Tank | Tagged: , , , , | Permalink
Posted by olegshilovitsky

PLMosaur, Traditional PLM and SaaS Newbies

May 14, 2010

I think cloud / SaaS option for PLM can become a reality earlier than expected. Listening to customers, vendors as well as reading all news and buzz stream, I can definitely see a changing trend with regards to cloud based solutions. There is an increased trend of discussion about possible PLM scenarios to introduce a cloud based and SaaS solutions. I can recommend to read the following posts from Jim Brown blog – Cloud and Multi-touch CAD/PLM: Engineer’s Nightmare , Josh Mings’ SolidSmack about SolidWorks on the Cloud. In addition, you can take a look on a very interesting presentation about Cloud/SaaS and PLM strategy by Tata Consultancy Services from PDT Europe last year. You can download slides from this location and, dispite “the confidential note”, these slides contain some excellent thoughts about PLM SaaS, PaaS and IaaS offerings.

Cloud and PLMosaurs
In my view, existing PLM vendors are facing significant disruption from the side of agile and lean vision of PLM/SaaS. Why I’m saying a vision? Because, realistically, I don’t see a significant presence of SaaS / Cloud based offering on the market. It seems to me, existing vendors have hard time to make solutions co-exist (i.e. PTC/IBM or Oracle Agile). The issue of security is a nuclear weapon that on premise vendors put in front of the customers when a discussion about moving to SaaS becomes really hot. As part of this discussion, the story of private cloud comes up, and I can see a tendency of PLM providers to think about moving existing PLM solutions hosted by public or private clouds. What will happen to existing PLMs? Is there a possibility for existing PLMs to survive and successfully squeeze into a cloud, or they will become PLMosaurs? This is a very good question, and I think, we’ll experience multiple trials of existing PLM solutions jumping on the cloud soon.

Lightweight and Granular
Life on cloud is not as easy, and if I’m looking on the experience of Salesforce.com, PLM vendors need to think twice before moving current product offering on the cloud. I’d recommend an excellent reading Behind The Cloud by Marc Benioff. Current monolithic architectures may have potential problems and will require re-engineering. Cloud will require a different content creation and application granularity techniques. Current solutions have a potential to re-use expertise and leveraging existing customer base, but this is going to be a challenging path.

PLM SaaS Newbies
There is a small presence of new companies in this space. PLM+ made a splash last year by their announcement, Vuuch is another interesting solution that can pretend on some of the space covered today by existing PLM products. I was reading Jim Brown’s write up about the future of engineering software strategies. He mentioned fewer new entrances and, at the same time, stated that “to innovate in a garage” is much easier than doing the same in a big company.

What is my conclusion? It seems to me PLM companies need to think how to ramp up with SaaS solutions. My concern is that hosting current product offerings as a SaaS by moving them to the cloud is one possible strategy, and it will be realized by PLM mindshare leaders soon. There are some advantages together with some disadvantages and a danger to end up moving all existing PLM problems on the cloud. I think, PLM needs to find an alternative way to solve manufacturing problems by providing granular SaaS solutions. This is the time to learn from the past experience of Arena, PTC/IBM and other pioneers of SaaS PLM offering and think about the future.

Just my thoughts…
Best, Oleg

Pic by lleugh (http://www.flickr.com/photos/lleugh/ / CC BY-NC-SA 2.0)

Share

8 Comments | Cloud Application, Daily PLM Think Tank, Future Trends, Technology | Tagged: , , | Permalink
Posted by olegshilovitsky

PLM, Cloud, SaaS and Software Upgrades

February 25, 2010

I’m continuing to discuss various aspects of PLM on the Cloud and SaaS. The issue I wanted to discuss today is related to the software upgrades. This topic is considered as a painful in the enterprise software and requires additional significant investment and effort. Let think what SaaS/Cloud can change potentially? In my view, there are two separate aspects we need to analyze: technological and business.

Technology of SaaS/Cloud
From the technological standpoint, moving to cloud or SaaS solution still doesn’t mean change in comparison to what we have today when we run software on premises. If your PLM solution, for example, will be delivered on dedicated servers hosted in data centers, you are not going to experience any change in comparison to the web solution deployed in the orgnization. These servers will run the specific version of PLM software installed on them and you (or your provider) will need to care to upgrade them in the same way you are doing it today. However, if PLM solution will be delivered in the multi-tenant architecture, and you’ll share instances of the servers with other customers, you have a potential to experience non-stop migration between software versions deployed by vendors. Even in this case, the question of how it will happen to be heavily dependent on details of the system implementation, data modeling aspects and many others. So, in my view, the devil of SaaS/Cloud technology is in details. You’ll need to watch it closely and understand what can be supported by your software provider. Certainly, some of the software aspects related to data modeling will still require “upgrade point” anyway.

Cloud / SaaS as a business model
This is another aspect that I’d not connect directly to the technology of an upgrade. The most widely accepted situation when moving to SaaS model is to get software licenses paid by a subscription fee and not by license fees. These change of the business model will likely move your software expenses to a monthly/yearly payment. I had chance to read some interesting observation about that business from Burton Group blog yesterday. You can find it here. (http://ccsblog.burtongroup.com/collaboration_and_content/2010/02/a-.html). However, even this subscription looks like a big change, in practice, lots of SaaS contracts that promoted actively as monthly payments, will be considered as 1-2 years contracts. So, forklift event, Burton’s blog is writing about, will be created by vendor.

What is my conclusion today? Marketing is doing a great job around SaaS and cloud software. However, not all marketing presentations are translated into practical realities. It can stay in the power point slides. Even if SaaS/Cloud computing is providing an option to be different from software on premises, you need to watch details of a specific solution you are going to move to.

These are just my thoughts… What is your opinion on that?

Best, Oleg

Share

27 Comments | Business, Cloud Application, Daily PLM Think Tank | Tagged: , , , | Permalink
Posted by olegshilovitsky

« Previous Entries
Follow

Get every new post delivered to your Inbox.

Join 71 other followers