The Enterprise and PLM will rock 2012?

December 18, 2011

As usual, at the end of the year, there is a time for blog posts with predictions, opinions and future trends. Last 2-3 years of technological boom were around consumer applications – social, web, mobile. These are three major application field that developed many technologies of the past years. How it may impact enterprise and PLM?

I was reading thebarefootvc blog earlier today – 10+ trends: recap of 2011 and what’s next… One of the trends mentioned in the context of 2012 was Enterprise. This is my favorite passage:

The Enterprise: The last few years have focused on consumer usage and adoption of technology. However, large companies are recovering from the shock of the 2008 collapse and re-aligning to the New Normal. Technology can play a role through cost reduction and creating efficiencies (virtualization, cloud computing) as well as top line revenue enhancement (utilizing data and social media for better customer service and sales strategies). New financial services and healthcare regulation will also create the need for related IT solutions.

It made me think about PLM in 2012. Few important events happened in the end of 2012. One of them – Autodesk entered PLM. This is an important move. Autodesk means "volume". Consumer market is also about volume. Volume means broader adoption and lower prices. Volume is about Toyota and not about Lexus. Second is a broader adoption of the cloud technologies. For many enterprise organizations now it is a question of "when" and not a question of "why".

What is my conclusion? 2012 has a potential to become a year of PLM rock stars. Cost will be one of the most important factors of PLM in a near future. Cloud technologies and behemoths like Autodesk will be playing a significant role in this process. Just my thoughts…

Best, Oleg

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DIY PLM and Zero Email Policy

December 16, 2011

Let’s talk about emails today. How many of them are you reading or writing daily? A lot? Emails are with us for the last 50 years. Will it stay with us for the next 50? Actually, some researchers are saying that we are reading fewer emails. Especially when it comes to younger people. Read last year NYT article – Email gets an instant makeover. Take a look on the following chart below from this article.

Younger people are actually banning emails and moving towards social networks. I remember the story that happened to me few months ago on board of the flight to Europe. Talking with my neighbor, I discovered that he has no email account. When I asked him how he is communicating, he said – Facebook and cell phone.

Do It Yourself PLM (DIY PLM)

What is DIY PLM? Earlier, this year, in my presentation during Autodesk Forum in Moscow, I analyzed PLM implementation options. You can see my presentation here. DIY PLM is one of the ways people are implementing PLM these days.

One of the observations, I’ve made is that email is one of the fundamental tools companies are still using to create an easy path to PLM by allowing to people to communicate and run product development processes.

Zero Email Policy

About a couple of weeks ago, I was reading the following ABC News article – Tech Firm Implements Employee Zero Email Policy. Employees of tech company Atos will be banned from sending email under new company "zero emails" policy. Here is a very interesting quote:

CEO Thierry Breton of the French information technology company said only 10 percent of the 200 messages employees receive per day are useful and 18 percent is spam. That’s why he hopes the company can eradicate internal emails in 18 months, forcing the company’s 74,000 employees to communicate with each other via instant messaging and a Facebook-style interface.

What is my conclusion? I think zero emails can be an opportunity for PLM vendors to propose some "new collaboration" infusion to companies. At the time companies are tired from emails and new generation is shifting towards something different like Facebook-style communication, PLM vendors have some advantages. It is already happened. Lead PLM companies are thinking about new "social" ways. You can see Dassault’s 3DSwYm, PTC Social product development and some others. However, vendors, please don’t make it lame… like emails. Just my thoughts…

Best, Oleg

image is courtesy of neboweb.

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PLM and Strategic Technologies for 2012

October 26, 2011

We are in the Q4 of 2011. It is a traditional time start thinking about what is going to happen in 2012. I was reading Gartner’s Top 10 strategic technologies for 2012 published after Gartner’s ITxpo 2011 Symposium last week in Orlando. What is strategic technology according to Gartner:

What’s a "strategic technology"? The short version is that a strategic technology is one that has the potential for "significant impact on the enterprise in the next three years." That means either an existing technology that’s matured or become suitable for wider use, or it’s an emerging technology that could provide a strategic business advantage for early adopters. If it’s new(ish) and going to impact your organization’s long-term plans or initiatives.

I expected (and hope you too) to see "cloud" in the list. However, the rest of the list looks interesting. Here is the list:

  • Cloud computing
  • Big Data
  • Extreme Low-Energy Servers
  • Next-Generation Analytics
  • App Stores and Marketplaces
  • In-Memory Computing
  • Mobile-Centric Applications and Interfaces
  • Contextual and Social User Experience
  • Internet of Things
  • Media Tablets

Read about Gartner perspective in details here. Some of the things are resonating with my thoughts about what PLM technologies will emerge and how CAD/PLM vendors can leverage them. Please take a look below on my take about what technologies will be important for the future development of software for manufacturing and engineering.

Cloud Computing

Well.. this topic is everywhere. I think "cloud" is about shifting paradigms. People, by mistake, see the cloud as a renaissance of mainframe computers connected via the internet. However, it is wrong, in my view. There two things where cloud will provide a shift – cost of services and availability. Take a look on one of my latest posts about the cloud- 3 Key Cloud principles: will CAD/PLM follow?

Big Data

The stories about Big Data are fascinating. The importance of big data related technologies in manufacturing is obvious. The amount of data gathered by enterprise organization is huge. Most of this data is "invisible" today. A fraction of this data is controlled by enterprise software. Rest lives between workstations, databases, Excels, portals and personal USB drives. A significant portion of data now is on the web, but it is not connected to information inside of companies. To have the ability to connect information Design-Engineering-Manufacturing-Support-Service-Marketing (sounds PLMish) is where big data technologies can help.

Next generation analytics

Business in general and manufacturing company specifically is all about a decision. You cannot manage anything if you cannot measure and analyze data. How efficient is your design, energy consumption, customer adoption rate, customer complains, supplier’s efficiency – all this information needs to be analyzed? The ability to embed analytics in the decision process is the key issue and top priority for most of the companies.

App Stores and Market Places

This is part of what called "consumerization". We finally got it with iPhone, iTunes, etc. Now we expect the same magic to happen in business. In my presentation earlier this month on Dassault PLM forum, I mentioned Enterprise App Store as something that will have a huge potential in the future. However, many questions are still not answered – who will decide about the purchase, how apps will be selected, how integration will happen, etc.

In-memory computing

The impact of how products can leverage new memory technologies (i.e. Flash drives) is incredible. Especially when it comes to calculation, simulation and analyzes. So, I expect it to be part of technologies, CAD companies will use the most.

Mobile centric application and interfaces

I hope you are taking mobile seriously. The revolution here is under go, and we will see lots of improvements in this space. However, the main point – you don’t need to be at your desktop to decide is probably the key. The amount of time, people will use mobile device and not laptop/workstation is growing. It will help to develop fields like – marketing, support, technical operation and many others. Since I published. Who can generate 3D/PLM content for Apple iPad two years ago, we can see a huge progress. You can see mobile/ iPad apps in the portfolios of almost every CAD/PLM company. Future here will be just amazing, in my view.

Contextual and Social Experience

Well, this is another "new kid". I think, everybody these days experienced "social addiction" of Facebook and other social networks. The "aha" moment these days is to understand how it will impact our business life and business decisions. Social technologies are running fast, but to find really workable stuff is hard. One of my last write ups about that is -PLM and Social Enterprise: Files vs. People? can give you some ideas where social can go.

Internet of things

Another "fascinating topic" in my eyes. I’m following "internet of things" trend for some times now. Here is my short note about that almost 2.5 years ago – PLM and Internet of Things. Some technologies in this space are really interesting for manufacturing / engineering – sensors, image recognition, 2D to 3D conversions.

Media Tablets

This technology is kind of extension to "mobile" story. However, it is all about experience and information consumption. My favorite example – Flipboard for iPad. You can take another "almost 2 years ago post" – Things are getting touchy (PLM Tablet user experience) and compare it with your experience today. Another aspect of tablet technologies is the development of API for information access.

What is my conclusion? Prediction is a tough job. Talking about technologies in the context of the future is twice though. In general, customers don’t care about technologies. They care about "getting job done". However, speaking about engineering, manufacturing and enterprise, I can see a "momentum for new technologies", because this place was too long unchanged. Just my thoughts…

Best, Oleg

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PLM Vendors and “Cloud Marketing” Hype

October 19, 2011

From time to time, I’m experimenting with Google Trends. These results, obviously, cannot be counted as a serious research. At the same time, they can provide some insight on what happens. This morning, I was playing around “cloud” and “database” terms. I wonder if possible to find any evidence of changes in the balance between these two trends from the marketing standpoint. So, you can take a look on results:

Looking on the picture above, you can see the trend is clear. However, in order to neutralize the influence of “ash clouds” :) , I also made a comparison between “database software” and “cloud software”.

PLM Marketing

CAD/PLM companies demonstrated a significant amount of focus introducing cloud oriented solutions. Earlier, I was talking about Autodesk and Dassault investments into cloud solutions. However, I found some interesting thing about Arena Solutions too. Arena is definitely not a newcomer if we speak about what we call cloud. Arena roots are going back into dot.com era 1990s when the company was started as bom.com. I tracked some funny marketing transformations that happened to Arena very recently.

Take a look on former definition of what Arena is doing (I took it from the old press release almost 4 years ago).

Arena Solutions is the leading provider of on–demand (SaaS) product lifecycle management solutions for manufacturing companies of all sizes. As the only true on–demand, secure Internet–based PLM service, Arena PLM provides a superior alternative to complicated, lengthy and expensive traditional PLM software deployments.

Fast forward into 2011. Pay attention on how Arena Solution presented now – Bill of Material (BOM) and change management solution in the cloud. It is also interesting to see a fresh look and feel of Arena solution website saying: Put your product data where it belongs. In the cloud. Interesting marketing transformation. Kind of “back to roots”.

What is my conclusion? I think, changes are really happen now. Even less than a year ago, people exposed lots of fear when talking about business solutions in the cloud. Not any more. I can see strong trends among the companies trying to evaluate possible advantages of cloud technologies. At the same time, when lots of things happen around in consumer technologies, marketing hype around the cloud becomes very strong, so enterprise software companies are trying to catch the wave. Just my thoughts..

Best, Oleg

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PLM & Market and Technology Trends

October 14, 2011

Yesterday I spent my day on Dassault PLM Forum in Moscow. The event website is here. You can see the agenda of the forum in English here. I was talking about PLM relations to modern market and technological trend.

Best, Oleg

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PDM/PLM and Future Competition

August 19, 2011

Google-Moto deal created a lot of fuss and speculation. At the same time, it created an example of cross-domain innovation, which in my view, worth being analyzed. I’ve been reading Forrester blog earlier today -What Signal Does The Google-Motorola Marriage Send To Product Strategists? Thinking about PLM future, I found the following strategic guidance important:

1. Forget what you know about traditional competitors. If you think you have a rock-solid understanding of your biggestcompetitive threats — think again. You’re probably wrong.

2. Learn as much as you can about adjacent innovations. Look around the fringe of your organization and yourindustry. There are likely to be several pockets of adjacent innovations all around you. If you can’t see them, you’re not looking hard enough. In fact, the next big disruption in your industry will be the result of the unexpectedconvergence and application of those adjacencies.

3. Learn how to control the chaos of idea overload. If you calibrate your R&D spend to stay within your traditionalindustry guardrails, you will fail to see the big adjacent opportunities that may be staring you in the face from theoutside. To be clear, this doesn’t mean to spend more on product development. It means to spend differently, in otherwise unexpected ways.

PDM/PLM eco-system today dominated by a small number of giant providers associated with either large CAD vendors – Dassault, Siemens PLM, PTC and large ERP vendors – SAP and Oracle. The number of smaller companies in this space decreased significantly for the last few years as a result of acquisitions and retirements. I decided to put some of my thoughts related to the potential future of PDM / PLM product, technologies and market space.

Innovation and Consumer IT technologies

I think, manufacturing companies these days are facing a very interesting and even maybe a unique situation. I want to name two most important trends – globalization and cross-organizational optimization. Product cost is the issue on the table, in my view. Because of the current economic situations, companies are not ready to follow the solution path they used before. At the same time, in order to have an ability to decrease product cost, companies are looking how to introduce new solutions, which will be different from what companies have been doing last 10 years. It requires the next level of IT development. Today’s systems are squeezed to the highest level of their potential. Existing PLM software is too expensive and relies on the technologies developed 15-20 years ago. Consumer and web technologies is a potential place where future innovation can come from.

During the last 10 year, the enterprise IT was very busy working on existing software assets and implementations. After Y2K, the enterprise PDM and PLM space wasn’t a place where people focused their innovative ideas. However, last 10 years accumulated huge amount of technologies coming from the web and consumer web space. Web 2.0, online games, social networks, photo-sharing services, e-commerce. This is only a short list of places where real innovation happened. Open source and technological platforms are coming from this place. Manufacturing companies and stagnated enterprise data management deals can be a place to apply these technologies. Focus on how to decrease the cost of change and low TCO can create a future shift in this industry.

What is my conclusion? I think, there is a significant pain in today’s PDM / PLM market status quo. We can see some movements made by existing players on the market. However, in most of the cases, they just put a "lipstick on a pig". To change existing platforms and business models is very costly and painful. Not every business can afford to do so. Especially when you have lots of existing customers and revenues. As it usually happens, outside players can get in and disrupt the space. Do you think it will be possible? I want to know your opinion. Speak your mind.

Best, Oleg

Image: renjith krishnan / FreeDigitalPhotos.net

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PLM Open Source: Strategic or Off Road?

March 17, 2011

I’m watching closely everything that happens around with Open Source. The world of Open Source is changing all the time. Remember, in the beginning it was about Linux. Then it comes to other places – content management, CRM, enterprise search, mobile platforms and many other places. What happens with manufacturing and engineering systems? Is there a place where Open Source can provide some advantages? I read an article Open Source Software Hits a Strategic Tipping Point by Laurie Wurster. The author discusses what traction Open Source getting in the industry. Here you can see some information about the level of Open Source acceptance on the picture below provided by Gartner.

Picture-25.png

These numbers made me think about what possible path Open Source can take in engineering and manufacturing software segments.

Open Source Debates

I can observe multiple debates in the software community about what is Open Source and what software can be qualified as Open Source. In general I can see an open source as a model that promotes availability of the software source code to the system end users and following modification. However, the model, is not clean and transforming all the time. Some disputed models in this space are community-based development as well as mixed licensing where some of the system code is proprietary and another piece is open under one of avaialble open source licenses. Alternative, stricter definition refers to the Gartner’s definition of Open Source as a software released under Open Source Initiative licenses.

Open Source and Engineering Software Segments

In my view, Open Source might have a different potential in engineering and manufacturing software segments. It depends on the level of specialty, community size and existing software product and vendors strategy in this segment. In general, I can see an open source trend is to go bottom up from more generic type of software to more specific one. The size of the potential community is also very important. For example, CAD/CAE is a segment, which can be characterized by very specific skills, large number of mature products and software vendors. Despite few examples (Archimedes, BRL-CAD,avoCADo), I think, chance for CAD Open Source is relatively low in coming few years. On the other side, data management has a wider implementation scope. There are several mature open source products in this space such asMySQL, Cassandra and others, so a potential data management solution such as PDM can be very possible created by community of data-oriented developers. The last segment I wanted to touch is so called "software for collaboration". In my view, this is one of the most confusing in the space of engineering and manufacturing. At the same time, there are many open source tools in this category that can provide a value and can be easy enhanced with additional features.

What is my conclusion? I think Open Source gains acceptance and making progress in diverse fields. Depending on the application field it can become strategic or get off road. However, your organization needs to have a set of skills to make an open source happen. It is all about implementation, changes, coding, testing. It cost money and resources. Multiple tools can be combined into compelling solution. Do you think Open Source is for your organization? What flavor of Open Source do you prefer and see more applicable? I’m going to discuss it next month during my Beyond PLM panel on Aras Community Event (ACE) next month.

Best, Oleg
Freebie.

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How To Stop Searching for PLM Killer App?

March 12, 2011

Are you familiar with the "Killer App" syndrome? In my view, conversations about a "Killer App" are very popular when some technological device or broad technological innovation needs to be proven. Killer App becomes so popular that return on the technology becomes obvious. I can bring some examples of Killer Apps in the past:VisiCalc on Apple II or Lotus 1-2-3 for IBM PC. However, in my view, talks about "killer app" are also a good indication about problems with a product or technology.

The following article caught my attention yesterday: What is the Killer Application for a Modern Engineer? I missed it when it was originally published in January. Chad Jackson, my colleague in the PLM Blogosphere, is talking about CAD, Collaboration and Mashups as examples of killer applications for Engineers. Where I disagree about the "notion" killer application in the context of engineers, I found analyzes Chad made in his post interesting.

Examples of Killer Apps?

CAD App
Personally, I think CAD is a mainstream technology. It was proven by many years. I don’t think, somebody today is designing any product without CAD system. History of CAD passed many waves of technological innovation that moved CAD between 2D, 3D and different computers platforms. I found surprising the fact SolidWorks wasn’t mentioned in the list of CAD products, but the choice of CAD was always somewhat "religious" and Chad’s selection didn’t surprise me.

Collaboration App
The history of various "collaborative applications" in the engineering space, in my view, started by introducing of data management to a wider company audience and following trial to expansion into PDM and PLM. The discussion about what is the killer app for collaboration is on going even today. My favorite collaboration tool for many years is email. Since I moved to Google App, I found it as a good addition to my email experience. PDM and PLM applications are constantly trying to replace email without visible success, in my view.

Mashups
The story of mashup is funny in my view. The word itself came to us from the Internet and Web space where applications (mostly running in the browser) "mashed up" the web content and making it more valuable for end users. The most successful mashup application, in my eyes is Google Map. I wrote about mashup on my blog before (Will Mashup Grow Up in PLM?) In my eyes mashups are interesting, but too vague and unclear from the standpoing of end-user who trying to get a job done.

PLM as a Killer App

In the beginning of 2000s PLM was introduced as a next big thing for engineers and manufacturing. After almost a decade of debates and different technological and product development attempts, I can see Product Lifecycle Management more as a "business and technological strategy" rather than "application".

Product Development: One Size Doesn’t Fit All?

Now think about design, engineering and manufacturing. It is all so different from various perspectives. Industry specific needs, departments and roles are different. Finally, every manufacturing shop is developing their own strategy for how to compete in the modern world and what can make it unique. If you ask me what application can fit everything, my ultimate answer is simple – Excel. Yes, Excel rocks when it comes to the flexibility and user adoption. The cost of customizing Excel to fit your needs is huge and the cost to support it even bigger (remember my Do you need chief Excel officer to manage BOM?)

What is my conclusion? PLM software vendors and analysts need to stop searching for a next "Killer Application". Flexibility and granularity are two important directions software vendors need to follow to gain next level of PLM software adoption. Just my opinion, of course. YMMV.

Best, Oleg

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PLM Reset 2011

January 6, 2011

Winter break is a time to make a traditional "lesson learned" or "next year" blog posts. I wanted to come with some thoughts about what I see happens in the industry and where the biggest shift is going to happen. The name "PLM Reset" comes to my mind as the most appropriate. For the past couple of years, I’ve been listening to quite many stories about how PLM was implemented in many companies. These stories made me think about a strong need to clean up the table of PLM implementations. Something that can improve PLM value proposition and make implementation more efficient.

Enterprise Trends
I can see few important enterprise trends happen now: cloud solutions, mobile enterprise, social and polygamous. All these trends will have a major influence on the future development of engineering and manufacturing systems as well as opportunities in this space.

Cloud Solutions will be one of the enterprise trends in 2011. IDC forecast IT spending will hit 1.6 trillion this year with 13% growth coming from software and services. The biggest growth will be in public cloud services. Cloud is not peripheral solution anymore. In 2010 Google proved that Google’s solutions are secured enough to serve GSA. Additional announcements came from Microsoft and other vendors involved into providing of cloud solutions. In my view, cloud can become a classic disruption story for the enterprise industry and software for engineering and manufacturing (including PLM) can take a significant benefits from that.

Mobile is a definite trend. I can see a tremendous success of iPad, iPhone and other devices. It leads to a lot of additional opportunities and changes in the enterprise landscape. All these devices are not completely ready for enterprise. However, the future development in cloud computing will make them connected to the enterprise cloud grid in a seamless way.

Social is another interesting story. I’ve been writing about social trends many times during the past year. In my view, "social" will be proliferating in organizations and will create a new connection system that will help to communicate in an organization. I can see a significant value of social component to improve PLM collaboration.

End of Microsoft’s dominance is another trend. Until now, most of the software used by enterprise were developed either in Redmond of Redwood Shores. Not anymore. We can see a significant growth in Apple adoption. Businesses are less interested in maintaining existing applications and looking how how to try something new that can help them to solve a problem in a different way. We will see also a massive adoption of software coming from employees.

Building a Simple PLM
In addition to the enterprise trends mentioned above, I can see a strong strive of enterprise organization to simplification. For many years, the complexity took a king role in the business of enterprise organization. In PLM, the complexity was a factor to justify high cost , services and implementations. The traditional PLM mind share in the enterprise – we need to have a complex solution to solve complex problems. Wrong! This is something that will be changed very soon. A very long time ago, Mark Twain wrote – “If I had more time, I would have written a shorter letter.” The simplicity is very thought. However, there is no other option these days. It needs to be understood by vendors and customers.

What is my conclusion? In my view, PLM is definitely in the position to re-born. All trends I mentioned above plus a demand for a simpler solution will lead customers to hit "reset" button. "Business as usual" is not an option anymore. The disruption of cloud and influence of other trends will impact PLM and make a future move towards introduction of new solutions in 2011. Just my thoughts…

Best, Oleg

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PLM and Cloud – Hold the Promise?

December 18, 2010

Cloud is trending. This is not a first time I’m touching the topic of cloud. During the past days, I had lots of healthy debates about different topics around PLM, Technologies and Innovation. Surprisingly, the topic of SaaS and Cloud didn’t come much into this discussion. Israel wasn’t cloudy during the day of COFES Israel event. Maybe it was a reason. Who knows? Autodesk R&D Israel and Dassault Solidworks presentations mentioned the influence of cloud, but only from the standpoint of mobility and device diversification. Originally, I wanted to spend some time speaking with PLM+ in Israel – a startup company working on a new on-demand solution for PLM. Unfortunately, a startup business and events are not always going together. I decided to spend some time and out my thoughts about PLM, Cloud, On-Demand and market demands.

PLM and Enterprise Software

What happens with enterprise software these days. Think about 2000s. The corporate life in 2010 is not much different from how it was in 2000. Multiple applications, interoperability problem, tons of Excel files and people who need to get a job done. Back in 2001, companies accepted long roadmaps. It is a different story now. Two factors become the most critical in Enterprise Software – the cost of implementation and cost of change. Another thing is a demand for simplicity. Simple is always winning. The last ten years of consumer software revolution created a huge demand for a change in enterprise software. PLM is strongly associated with two words – complex and expensive. Mindshare PLM leaders as well as smaller PLM vendors are reacting. You can see PTC Creo, Aras Open Source and some other initiatives are trying to break a perception of complex and expensive PLM software. It is also interesting to see how Autodesk is making an effort to solve PLM problems without calling themselves PLM.

PLM and Cloud Promise

People have different understanding of what cloud means. I can probably break it into three main category. 1- Software available from the cloud (i.e. Salesforce). 2- Access to data anywhere (i.e. Dropbox). 3- Elastic computational power (i.e. AWS). I can see companies are trying to embrace cloud technologies. They do it differently. Software access for the cloud is a place where companies are hold the promise (i.e. Dassault cloud offering planned in 2011) or experimenting with tools (i.e. Autodesk Lab projects, including acquisition of Israeli Visual Tao and creating AutoCAD WS). The security conversation is dominant when you are talking about data on the cloud. The advantages of data access are obvious. However, regulation and company concerns, even if it looks like a red-herring, are still dominant in these discussions.

Cloud and Cost

Will cloud solution be cheaper? This is an answer press, analysts and users are trying to get from vendors. However, there is no straightforward answer on the side of vendors. I think, one of the main reasons is a very unclear situation related to the marginal cost of cloud services. Big cloud players, such as IBM, Amazon, HP, Google and IBM are playing with buzzwords- cloud servers, private cloud, data centers. Software vendors are experimenting with all of them. I don’t see much clarity in this space.

PLM and SaaS

If you think, about PLM and SaaS (or OnDemand), you need to put your hands on the experience of Arena Solution. Re-branded bom.com, started during the late 1990s, Arena is providing PLM on demand solution for the last decade. One of their struggles was to provide an appropriate connection to design systems. As a result they focus on industries less dependent on heavy CAD experience. PTC and IBM also made some experiments in this space. I found interesting to learn about Autodesk BuzzSaw experience (even if this not presented as PLM solution, the SaaS experience is interesting). To analyze the advantages of PLM on Demand, I’d suggest to think about the potential benefits of SaaS and try to apply it into PLM space.

Anywhere access - this is an obvious benefit. Gmail is a good analogy. Is it possible to have an access to a corporate application using VPN tunnels and other channels? I think, yes. So, it will not play as a significant differentiation factor, especially for big companies.

No capital investment and cost - this is a big thing. The usage of a subscription model is a significant financial benefit. However, only if it comes to a comparable cost to a solution to be implemented on a premise. Companies will be easy to make their own calculations and decision about buy vs. rent.

Monthly payment obligation – this benefit is only true if you make a monthly contract. Many SaaS/OnDemand solutions, in fact, are signing yearly contracts. In this case, the benefit of payment is diminished within the time. In addition, data is another element that can decrease an effect of “pay-as-you-go” solution. If you decide to move, you need to keep an existing system at least until you transfer all your data between systems. SaaS/OnDeman model is also a potential data locker with a more complicated way to access the data for export/import purposes.

Faster implementation – most of SaaS solutions are very simple. Therefore, fast implementation speed is obvious. However, it is complicated in PLM. Nobody is running their manufacturing shop in the same way. The ability to provide a match to customer needs is a key. The balance of flexibility and OOTB solution is an easy, but a very complicated answer. OOTB decreases a potential list of customers. Flexibility can also increase an overal solution cost.

Scale-Up and Efficiency - this is an obvious benefit for companies that have no abilities to invest in data centers and hosted servers. The ability to raise a number of users can be a nice feature. However, the question of cost will be probably a key one to decide if it is worthwhile.

What is my conclusion? Cloud is an interesting these days. It provides a multi-dimensional opportunity for customers and business to optimize the solution. Can it solve main problems of manufacturing companies looking how to get the job done? Probably yes. However, not in a straightforward way. I can see a cloud as a very dynamic place. To be able to provide a solution fast, react on customer feedback is probably one of the key factors to success in this space. Just my thoughts…

Best, Oleg

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