COFES 2015: PLM and the cloud briefing

COFES 2015: PLM and the cloud briefing

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.

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

 

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  • Hi Oleg,

    I am sorry that I missed COFES, now that I have aged into the right demographic.

    One of the interesting things for me about the cloud is tailoring/customization. One of the best (and worst) things about on-premise data and process management solutions is an organizations’ ability to make these solutions their own. This can be a good thing, but is very often what makes them more expensive and problematic in the long run.

    Most cloud solutions to date allow for little customization, and when they allow it what can be done is circumscribed so that new versions can be seamlessly brought on-line. Overall I think this is a good thing, but it will be a bad habit that companies and systems integrators will have to unlearn.

    Stan Przybylinski

    VP of Research

    CIMdata, Inc.

  • beyondplm

    Hi Stan, thanks for your comment! Customization is a killer factor for many implementations turning them in some sort of “PLM titanic”. However, I can see some similarity on the side of cloud PLM solutions too. Not all cloud PLM solutions are the same. But some of them are providing the amount customization compatible with on-premise products. And implementation compatibility is a huge challenge for these vendors.

  • Troy H

    In general, I think it is important for PLM products (as with pretty much all enterprise products) to provide approved methods for customization. Like most things, there is a right and a wrong way. When done the right way, customizations provide efficiency without drastically affecting upgradability.

    I also remember reading the Autodesk Anti-PLM rants, a bit of egg on the face there in hindsight. Additionally, selling implementation of PLM360 as being as easy as setting up an account is pretty shady. You can be in the environment quickly, but getting it configured to be functional is a much much longer proposition and getting it to be part of the culture of a company is even longer.

  • beyondplm

    Troy,

    Thanks for your comment! The problem of upgradability usually comes to PLM in 2 situations- 1/customer is using direct SQL injections. 2/ PLM vendors stop supporting APIs. I don’t have statistics, but my hunch #1 is a very common case and as a result to upgrade old PLM system is very hard. Focus on APIs and openness is very important here.

    You are absolutely right about implementation part of PLM related to PLM360. You can find interesting to read one of my previous blogs

    What cloud PLM cannot do for you?
    http://beyondplm.com/2014/09/19/what-cloud-plm-cannot-do-for-you/

    Best, Oleg

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