Cloud PLM and Small Manufacturers Survival Plan

Cloud PLM and Small Manufacturers Survival Plan

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 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 sector than 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 issue unless 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


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