Will PLM take a hybrid cloud route in 2017?

Cloud was one of the main “debated” topic in PLM for the last 2-3 years. All PLM vendors learned how to attach “cloud” word to their marketing, products and technologies. However, when it comes to implementation, the devil is details. The discussion about SaaS applications vs hosted cloud solution was pretty much dominant for the last 1-2 years of PLM cloud development. But I think, we’ve forgot about “hybrid” cloud. And, in my view, hybrid cloud might drive some interest in 2017.

In my old article back in 2013, I asked the question – Will enterprise PLM embrace hybrid cloud? Hybrid cloud is one that involves attaching existing IT infrastructure to a public cloud provider via a private leased line or a public internet connection. The main advantage to a hybrid cloud is that it allows existing infrastructure, including legacy hardware and code that are otherwise expensive and disruptive to replace.

TechTarget article Is 2017 the year of the hybrid cloud management platform? can give you some perspective on why hybrid cloud might be an interesting option.

It’s common for an enterprise IT operation to consist of a hybrid combination of public and private clouds topped with a healthy dose of software-as-a-service and platform-as-a-service subscriptions, with database as a service, mobile backend as a service, and perhaps analytics as a service thrown in for good measure. Consequently, it’s no surprise that implementing a hybrid cloud management platform for managing multicloud environments is becoming a priority.

As businesses increase their reliance on cloud-based infrastructures, platforms, and application services, the need to have a clear understanding of how they are used is essential for operation that is simultaneously uninterrupted yet efficient and economical, she said. “Management will expand to include cost considerations.”

That expectation is in line with the 2016 State of the Cloud survey from RightScale, one of several vendors providing hybrid cloud management platform products. Multicloud is central to the IT plans of 82% of survey respondents.

So, why do I think hybrid cloud can be an interesting thing to watch in PLM implementations? Manufacturing companies are increasing the use of public cloud software (SaaS). There are multiple factors why companies are investing into SaaS applications. Forbes article – IDC Predicts SaaS Enterprise Applications Will Be A $50.8B Market By 2018 can give you an idea about future directions of SaaS applications. The following passage is very insightful.

“Demand for SaaS enterprise applications is accelerating and exceeding the demand for on-premise applications by five times (during the five-year forecast period through 2018, SaaS revenue is forecast to grow at 17.6% CAGR, while on-premise revenue growth is only forecast at 3.1%). Generally, wherever new enterprise application software is required, the expectation is that SaaS applications are preferred, particularly for customer relationship management and enterprise resource management applications. However, most of the enterprise software currently in use today and in the near future remains on-premise, particularly in the areas of supply chain, manufacturing, and engineering…

What is my conclusion? SaaS applications are preferred because of fast ROI and flexibility. While majority of engineering and manufacturing applications are still on premise, hybrid cloud can be an important mediator to bring both existing on premise applications and new cloud based SaaS services together. For manufacturing companies looking for fast ROI and quick implementations it can be a away to keep an existing set of applications and use it together with new cloud services. Just my thoughts…

Best, Oleg

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Disclaimer: I’m co-founder and CEO of openBoM developing cloud based bill of materials and inventory management tool for manufacturing companies, hardware startups and supply chain. My opinion can be unintentionally biased