Customers demand openness of cloud PLM solutions

For very long time, security was one of the top concerns stopping enterprises and manufacturing companies from adopting cloud technologies. While it is still true, the future barriers to cloud technologies and cloud PLM can be different.

The latest Internet Trends report from Mary Meeker contains a section devoted to the cloud. My attention was caught by the article – Report: Enterprises Increasingly Concerned with Cloud Vendor Lock-In. The following passage can give you an idea about the problem and trend in customer concerns.

Cloud Concerns: The 2017 report noted a shift in the primary concerns of enterprises about cloud computing from 2012 to 2015. Basically, in that timeframe, the share of survey respondents citing criteria as a top-three concern shows a shift from worries about data security and cost uncertainty to worries about vendor lock-in and compliance/governance issues.

During those four years, the percentage of respondents naming data security as a top-three concern fell from 42 percent to 35 percent. Uncertainty of costs and savings fell from a respondent percentage of 38 percent to 21 percent. Conversely, compliance/governance respondent percentage grew from 21 percent to 27 percent, while lock-in (the ability to change vendors) grew even more important, going from a respondent percentage of just 7 percent in 2012 to 22 percent in 2015.

The problem is resonating with long time issue that near and dear to the hearts of many CAD and PLM users.Vendors lock-in. It is painful. Proprietary CAD formats used by vendors many years, which allowed them to charge premium fees. But the data backbone lock-in is even worst. Data management can potentially lock users even harder than CAD format and be even more dangerous. The example of some large customers stuck with highly customized PLM solutions forever is a good reminder. The cost to escape such data platform is even higher than migration to another CAD system.

Vendors outside of CAD and PLM spaces are facing the same challenges and developing solutions that can guarantee a way for users to escape their data management environment with minimum risk. A good example of such initiative is Google Data Liberation Front. It was started almost 10 years ago and delivered Google Takeout product capable to extract data from your Google account.

What is my conclusion? In my view, customer demands and concerns about vendor and data lock-in are real. Cloud has a real opportunity to change the trajectory of proprietary engineering data management solutions. I shared some of my ideas back in 2010 in my blog  – Open Cloud and Vendor Lock-in. One of my thoughts was about building open engineering cloud. Focus on standards, openness and data disambiguation, open cloud can facilitate data exchange and data openness and can be an important factor in customer’s decision to move to cloud solutions. The potential winners will be companies investing in open platforms and not lock-in their customers in proprietary data backbones. Unfortunately, existing cloud PLM solutions have a chance to become the next mouse-trap for customers similar to what CAD format was last 20 years. Data architects and PLM strategists should take a note. Just my thoughts…

Best, Oleg

Want to learn more about PLM? Check out my new PLM Book website.

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.