Cloud and how to make people to switch to new CAD, CAE and PDM tools

My yesterday blog How to compete with Solidworks? brought a number of comments and questions I thought would be interesting to share and discuss. Here are some of them.

Comment 1: I don’t share your vision about the cloud. I think the Solidworks users don’t want a cloud because they are afraid of the internet lost connections and the data safety. Perhaps I’m wrong, but as says B. Charles, Solidworks users love desktop version, so it’s the same about data management.

Comment 2:  The arguments against cloud based (buzzspeak for server monetization) data retention are valid; abdication of data security to a third party, ability of the vendor to “leverage” their hold on your data into higher fees, and the dynamic economic and business landscape that could render the vendor into bankruptcy make the risk benefit ratio too high. With hard drives running less than $100 per terabyte the reasons for cloud based data management are thin.

I found an interesting similarity between these comments. Although, at first glance, these arguments sound like anti-cloud, they are actually against changes in current status quo that cloud can bring to engineers, CAD and PDM systems. Just think about it- why to bring a new tool? Our customers love desktop version of CAD (and probably PDM too). Why to bring cloud-based data management tools? The cost of storage is so low, cloud-based tools cannot be justified. It is about economics and status quo.

Here is why I think many people are getting it wrong. But… because of a good reason. In my view, cloud is enabling new era in manufacturing. Cloud provides manufacturers more flexibility to work with suppliers, contractors and highly diversified set of tools IT department cannot bring to a company.  Cloud-based products bring proliferation of data. The amount of information is growing and it can be challenging for manufacturers to harness and collect insights from all the data created through the entire supply chain and value chain. However, once engineers and manufacturing companies can tap into this data, it will bring real business outcome. Data is a new oil and it can be extremely valuable. Last, but also very important – cloud can make silos a thing in the past. The cloud is enabling engineers and manufacturing companies with new forms of communication – both upstream with suppliers and downstream with customers. Use cloud tools can eliminate silos originally created by desktop and on premise tools.

You can tell me that this is a traditional cloud marketing –  data, collaboration, communication, silos… yada, yada, yada… But here is the thing, the point is how to create new cloud tools and to turn it into new functional capabilities and business model changes. Think about smart phones and navigation applications. An ability to track phone movements enabled technologies such as Waze to create new “social” navigation system. Think about breaking silos. Sounds like typical cloud mantra. But what if it will bring an opportunity to change the way companies are ordering parts and collecting insights about the design. What if new cloud-based infrastructure can supply information to business owners and by doing so will create a new economic and business models  for CAD and PDM/PLM applications?

Earlier innovation in CAD and engineering data management was enabled by new technologies, but also supported by significant economic advantages. To use IBM PC or Windows gave birth to new tools with unimaginable price point for both hardware and software. Databases enabled manufacturing planning innovation moving from “order point” systems to lean manufacturing supply models.

What is my conclusion? People are lazy and people don’t want to change. Until you give them a good reason why to do so. Solidworks users are demonstrating the level of current desktop CAD tools resilience. To change a status quo, cloud tools should come with new business models and functions to make desktop tools irrelevant. In the last 10-15 years many industries passed this transformation. Now it is a time for manufacturing companies to change. 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.