The upfront E-zine article brought me back to my notes from Peter Schroer’s keynote at ACE2021. If you missed the event, you can check the presentation online. Although, Peter’s presentation is not available because of some website errors.
My favorite part of Peter’s presentation was about digital transformation and data availability. Here is the passage as it was captured by the upfront article.
I’ll give you a prediction: no digital transformation project is going to succeed, It’s just not possible if engineering and operations systems are standing between you and real-time data accessibility. If we can’t surface this data and enable it throughout the rest of the organization, and if it’s not part of your digital transformation, then you are really stuck.
We think about typical PLM users. They are on an old version of Teamcenter, 3dexperience, Windchill, or SAP. It’s a very difficult upgrade path to get to modern technology. If we can’t get to the latest versions, we’re not getting to the openness and we’re not getting the technology that has the connectivity. How are we going to work with data that’s in a proprietary, closed system?
I’m in agreement with Peter about the data locking. In my last week’s article – Why Open Architecture is still rare in PLM, I shared my take on what is needed to unlock the data. One of the key elements of the change is the business model.
Remember the famous movie Twins with Arnold Schwarzenegger and Danny DeVito? Money Talks, Bullshit Walks. This means that cheap talk will get you nowhere, while money will persuade people to do as you like. You ask me how it is related to the PLM openness? Very simple. The cheap talks are for many discussions about the openness of PLM architecture, API, transparency, participation in different standard organizations or even joining ISO standardization groups. All these things are cheap because there is an elephant in the room and it is the PLM vendor’s business model.
And the PLM business model means data locking. Because, otherwise, the competitors and vendors responsible for adjacent solutions will be able to capture the data and expand the solution further. And nobody really wants it to happen. As a result, we have what we have – PLM systems have some API and some modularity, but the integrations are not simple and they keep customers in the close circle of tools provided by a single vendor because there is a rare situation when a vendor will benefit from giving the data away.
Does Aras suggest a new solution here? It is not clear from Peter’s presentation. He speaks about empowerment as a way to unblock C-level decisions to use legacy software. I can feel this pain. Customers are using an old PLM software, but don’t want to take on the risk to change it. The change itself is also super expensive and high-risk. Here is the passage to explain Aras empowerment, which is based on a free Aras download (aka Aras Enterprise Open Source).
We have seen our customers start with Aras PLM installed next to TeamCenter, over time incrementally moving the workflow from one system to the other. It’s a great way to get things done efficiently and successfully. It’s iterative: we’re talking evolution, not revolution.
In any major project like this, there are going to be setbacks. We want to be able to handle setbacks. There’s a direction we are going that doesn’t play out well, so we need to back up. You need to create a culture that allows for some disappointments, setbacks, and failures, to continue making progress but that doesn’t actually stop you. We have to enable low-risk failure.
Aras free download model really worked – companies took the software for free and explored in grassroots initiatives what to do and how to replace old systems with new systems. There are two major challenges here – (1) It is a long process with a lot of challenges: (2) SaaS model adoption is technically eliminating the point of free upgrades provided by Aras – Check my article What is better than free upgrade (https://beyondplm.com/2019/05/13/what-is-better-than-free-plm-upgrade/). While SaaS is not free anymore and companies are stuck in the process of IT/data innovation, what can be a driver to move to a better place?
In my view, the only driver is a business model that can encourage vendors to share the data. Not to think about how to take over Teamcenter, but to figure out what data management technologies can create a business model for data services. Data living outside of the systems is big empowerment that can change the trajectory of future PLM tools.
What is my conclusion? Enterprise companies are a messy place with tons of data scattered among multiple applications and tools. Many of them are old, but powerful with the business models focused on how to eat PLM data, lock it and turn their platforms into vertical black holes (https://beyondplm.com/2021/05/07/admin-4/). I agree with Peter, we need to have empowerment. But, in my view, nothing will change until we will figure out a new business model to empower the data and benefit vendors to switch from data locking for profit to data services sharing data for profit. The current business model eats agility for breakfast and stays hungry. The change is needed to turn PLM data into a healthy breakfast. Just my thoughts…
Disclaimer: I’m co-founder and CEO of OpenBOM developing a digital network-based platform that manages product data and connects manufacturers, construction companies, and their supply chain networks. My opinion can be unintentionally biased.