PLM for small and medium-sized companies is driving more attention and discussions recently. My article Can Aras PLM Scale Down To SMB? raised a healthy amount of comments and disputes. The list of concerns contains questions about IT needed to be involved to set up and maintain PLM, the nature of the solution – out of the box (OOTB), toolkit and flexibility. While I can see disagreement on some topics, there is one thing everyone agreed – small and midsize manufacturing companies and engineering teams are not buying the same size enterprise PLM solutions. Few interesting data points here. Check some of my articles about PLM for SMB here. As you can probably see from my articles, most PLM vendors are trying to get into this market – Autodesk, Dassault, Siemens, PTC, and others.
Today, I want to talk about PTC. There are two reasons for that. (1) Over the course of the last years, PTC made several attempts to deliver a solution for SMB segments. I’m sure PTC learned a lot. (2) Cloud and SaaS is no brainier decision when it comes to SMB. PTC acquisition of Onshape a few months ago can unlock some potential to PTC that they had no before.
A long time ago, PTC and IBM were hosting Windchill for small and medium businesses. Not sure how many customers this solution had, but you can see some links about this product offering even today
PTC Windchill ProductPoint in 2008 was another attempt to use trending Microsoft SharePoint infrastructure. PTC built a product by using SharePoint as a platform but later discontinued the product.
Another attempt was the launch of the PTC PLM cloud for small and midsized companies. The idea of a proven PLM environment delivered with a lack of dedicated IT staff was absolutely right to the point. But it didn’t work.
As Jim Hepplemann stated during the press and media presentation about Onshape acquisition, to run 100 servers for 100 small companies doesn’t make much business sense. Hens the importance of multi-tenant SaaS architecture.
PTC researched the transition to the cloud and made a conclusion that no company in history was able to port the existing systems with traditional server-based and web architecture to the cloud. All leaders in the SaaS industry built these systems from scratch and not ported existing systems. The architecture principles are different. The systems were developed for a “company”. And to run 100 systems for 100 companies in the cloud is a big problem. You need to run one system, which has a multi-tenant architecture to share multiple companies. Old architecture cannot scale and also will lead to low margins (or high cost – whatever you like to call it).
A few days ago, I attended an Onshape webinar Ask Me Anything: Jon Hirschtick, where Onshape CEO and co-founder, now President of SaaS Business at PTC talked about the future of Onshape with PTC, technological and business trends – generative design, 3D printing, and many others.
Jon was talking about the Onshape multi-tenant SaaS platform and PLM frameworks. He highlighted the unique capability of Onshape to work with no files and also stressed the point of the high demand for modern engineering and manufacturing customers compared to the years when his team founded Solidworks. While speaking about PTC acquisition Onshape, Jon was clear that this is not an “exit” but just a step on the road to developing future solutions for engineers and manufacturing.
In my view, Onshape has outstanding technology and product. I know, it is crazy hard to build a product. But what is even harder is to build a business. Onshape platform and focus on MCAD is a great potential for PTC. The modern needs of manufacturing companies go much above just an MCAD. Even small and medium-size companies are developing complex products combining mechanical, electronic and software components. Systems are complex. But what is even more complex is the modern landscape of manufacturing companies. PLM for SMB is becoming a solution for a network of companies working together. To build a business that can make customers to move to a new solution and grow is the biggest challenge. There is a need to find the right recipe that can appeal to customers to change the current status quo.
What is my conclusion? PTC has a unique opportunity to change the status quo of the PLM SMB market with a new Onshape platform. The timing and technologies for SaaS solutions are right. PTC has a capital. The right solution, combined with a business model is the biggest thing PTC should figure out to make a success. Just my thoughts…
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.