Learning about Teamcenter X And How It Can Impact PLM SaaS Development

Learning about Teamcenter X And How It Can Impact PLM SaaS Development

A few weeks ago, we learned about the major move of Siemens Industrial Software (formerly known as Siemens PLM) to SaaS and introduction of Teamcenter X, which is according to the presentation made during Realize LIVE event is the PLM of the future – fast, secure, always up to date, highly available, compatible and distributed for a fixed price. Check my blog here.

Siemens was one of the last PLM companies coming out with a SaaS solution. Just a week before RealizeLIVE, PTC announced their Atlas platform.

I was fortunate to spend time with a group of Siemens product executives and technologists to discuss Teamcenter X, cloud architecture, and the approach Teamcenter is taking to deliver its SaaS products. You can see above a picture of me on the web meeting – this is a reality of modern communication at the time of COVID-19. Here are some notes I took during the meeting.

Teamcenter X and SaaS

Siemens is coming to address SaaS business with the acknowledgment that they have probably the biggest market share of PLM (cPDM according to CIMdata) in the industry. The backward compatibility and customer support is a significant element in all technological and product considerations Siemens is taking. Customers are not interested in pure technological changes unless it doesn’t come with functions, features, and business models. Tech matters for vendors to deliver what customers demand.

Teamcenter Web user interface is a foundational element to deliver Teamcenter X SaaS products.  In addition to that, Siemens is taking a hybrid approach by developing cloud data services compatible with Teamcenter data and additional products like Teamcenter Share for collaboration. All of them are built on the same set of services.

Customization and existing Teamcenter environment migrations to SaaS will be addressed technologically but as managed service. This means TeamcenterX will have multiple deployment options such as on-premise, managed services, and SaaS. It was not fully clear to me if all of them will be called Teamcenter X and where is the border between Teamcenter and TeamcenterX. The new infrastructure of the Mendix low-code platform will be combined with TeamcenterX services and available to customers to expand current product offerings.

Here is a slide that can give you some ideas about Xcelerator and Teamcenter X architecture.

What I learned about Teamcenter X made me think about possible PLM trajectories in PLM development of industry leaders and startup companies approaching the PLM market these days. Here are some of my thoughts.

1- Traditional market segments and mindshare PLM vendors

Most of the existing Teamcenter customers in 2020 might not be interested in the SaaS offering yet unless it brings significant financial opportunity. For these OEMs, SaaS is about business models and not technology. They might be interested in some future SaaS vision, but it is not a deciding factor. They are waiting… It is true for all customers using big PLMs today. So, for all these customers SaaS is a future strategy and vision. It looks like not having “SaaS” in the 2020 checklist will be soon a disadvantage, so Siemens is running fast to fill the void that can be taken by PTC Atlas and Dassault 3DEXPERIENCE.

2- Ownership of platforms and the data

Owning the data and platform is extremely important. Siemens (and I expect the same from all PLM vendors) are extremely careful how to keep the tech of product data management and keep controlling product information from any standpoint. I’d not expect anything different with regards to data platforms and owning full-stack data management is important for all companies. This is why PTC acquired Onshape for SaaS, DS is building 3DEXPERIENCE and now Siemens is focusing on how to preserve current Teamcenter assets. All of them won’t let data to leak out.

3- Technology is important in SaaS

Tech is important. Manufacturing challenges are very unique when it comes to capabilities of managing the Bill of Materials, product structures, planning configurations, doing BOM solve, and addressing production planning. PLM companies will continue to do everything to preserve tech ownership in their SaaS products and it will continue to be a competitive advantage. I’d not expect PLM vendors to move to other IaaS/PaaS options to deliver SaaS PLM. A unique tech for SaaS tech in PLM can be an interesting thing for the future.

4- Business Model

For SaaS, the business model will be a huge differentiator. The market is divided into existing markets and white space. For the existing traditional PLM market, the cost of migration is prohibitive to introduce a replacement for existing solutions. For non-traditional industries and specific market segments, business models will be the key to acquire customers fast. Everything that will help to increase market share and penetrate future competition will become extremely important. Democratization will start from business models.

5- User Experience

Customers in the 21st century demand a comprehensive approach in user experience, which combines product, tech, business, support, and services. Modern customers are coming with the demand never seen by traditional PLM vendors on how to manage data, collaborate, and work with customers.

What is my conclusion?

Moving from on-premise systems to SaaS is a complex architectural, technological, product development, and customer support challenge. Siemens is taking a unique approach in hybrid development to allow to existing Teamcenter code to be hosted, combined with newly developed cloud services and leveraging new product development as well as with other acquired solutions (eg. Mendix). The scale and complexity of this approach are very high. Siemens’ biggest challenge is to make Teamcenter “compatible” and not to lose existing products, data, and customers in this transition. But this challenge is also the biggest advantage Siemens has because the cost of migration of Teamcenter customers to alternative platforms is sky-high.

I’m not done with my TeamcenterX study and I hope to have an opportunity to learn more about Teamcenter X data management and how Siemens plan to approach mid-market with a new SaaS offering. The last one is interesting because this is a space with less resistance and backward compatibility. What approach TeamcenterX will take? Will it limit to PDM SaaS solutions only like most out-of-the-box Teamcenter offerings? Will TeamcenterX offer a SaaS PLM solution to address mid-market? There are still many not answered questions.

Just my thoughts…

Best, Oleg

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.


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