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.
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…
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