Efficiency and productivity are at the core of many decisions made by manufacturing companies. How to reduce the cost and optimize the performance while developing new innovative products. Talk to many manufacturing companies and you will find how painful these problems are. Earlier this week, the announcement about Rockwell Automation buying Plex ERP software made me think about how future PLM software will help to boost manufacturing companies’ performance in the upcoming years.
Focus on Productivity and Efficiency
But before jumping into the future ideas, let me take a step back 50 years in the history of design software. Broadly speaking, design software (aka CAD) at its core was always about making the design process more efficient and helping manufacturing companies to become more competitive. There are many examples, but my favorite example is coming from the system called CADAM (computer-augmented design and manufacturing) developed originally by Lockheed Martin.
I recommend you to read David Weisberg’s history of CAD and specifically the story of CADAM. It provides many interesting data points on how CADAM helped Lockheed. Here is a short passage:
Customers were soon reporting significant productivity gains using CADAM. Lockheed Georgia utilized a four-terminal system on a project to produce a stretched C 141 aircraft for the Air Force. The original plan envisioned a maximum staff of nearly 70 people working on the project for a period of 18 months. They were able to do the work with a staff of 40 and they did it in 12 months.
Data Brings Intelligence
Jumping back to the story of RA-Plex, you should pay attention to the intent of Rockwell to optimize production, monitoring and data collection using the Plex multi-tenant SaaS platform.
As it is stated in Rockwell/Plex press release, Plex platform is a single instance multi-tenant technological piece
Plex offers the only single-instance, multi-tenant SaaS manufacturing platform operating at scale, including advanced manufacturing execution systems, quality, and supply chain management capabilities. It has over 700 customers and manages more than 8 billion transactions per day. Plex’s software capabilities will be further differentiated by Rockwell’s global market access, complementary industry expertise, and ability to turn real-time data into actionable insights.
Brian Shepperd, senior VP for software and services at Rockwell (former VP of PTC) elaborated more on the value of the data.
“Rockwell believes in the power of data and technology to transform manufacturing and industrial operations,” said Brian Shepherd, senior vice president, Software and Control, for Rockwell Automation. “Together with the advanced asset maintenance and management capabilities provided by our recent Fiix acquisition, Rockwell will have a strong portfolio of cloud-native solutions for our customers’ production systems upon completion of the Plex acquisition.”
Here is the passage from the Silicon Age article that gives you a broader perspective.
Manufacturers look for ways to improve efficiency by logging data about their operations, such as how many vehicles were assembled in a given day, and analyzing this data to find potential issues. If the log shows that one of the production lines in a factory experiences equipment-related outages more often than the rest, technicians can infer that it may be necessary to replace the hardware. It’s this process that Plex Systems helps streamline for customers.
The process of logging data about factory operations has historically been done manually. Plex Systems’ software collects the data automatically, which saves time for employees while at the same time reducing human error and thus lowering the amount of erroneous information that enters the log.
Plex Systems also provides analytics tools that companies can use to scan the data for insights on how to improve their operations. The company’s platform has visualization features that turn raw industrial information into graphs. If more granular insights are needed, business analysts can run queries on the information using standard SQL syntax. According to Plex Systems, its software lends itself to finding opportunities for improvement in not just production lines but also a manufacturer’s product quality assurance process and supply chain.
The three key elements – (1) improve efficiency using data; (2) automatic logging data and (3) provide analytical tools. Which reminded me of my earlier articles about multi-tenant architecture and manufacturing intelligence and also how multi-tenant architecture can unlock the value of data in manufacturing.
A bigger trend towards data, intelligence and software
The Rockwell-Plex deal is not a single event. Manufacturing companies double-down on their investment in software and very much focus on how to acquire software platforms to become more competitive in the tough competition in the reality of the complex manufacturing world and challenges of the modern supply chain. Check The Bloomberg Business article Siemens’s New CEO Sets Sight on Software to Boost Valuation.
After his predecessor spent years whittling down Germany’s preeminent industrial conglomerate, new Siemens AG Chief Executive Officer Roland Busch has set his sight on raising the manufacturer’s valuation by doubling down on software. Siemens is targeting acquisitions of software-focused companies to break into “highly attractive” new markets adjacent to its existing businesses that offer as much as 120 billion euros ($143 billion) in potential revenue, it said Thursday. Digitalization, automation and sustainability are growth engines for our business,” Busch said in a statement ahead of a presentation to investors. “As a focused technology company, we want to strengthen our position in all our markets.”
Foreshadowing the direction of future acquisitions, Siemens in May agreed to pay $700 million to buy supply-chain management firm SupplyFrame Inc. that provides intelligence on factory outages and material-cost changes.
Multi-tenant SaaS and Product Data Intelligence
Product data is a goldmine of intelligence for manufacturing companies. But unfortunately. The legacy PLM systems gave a very little focus to the data and more focused on file management and process control such as check-in/out, change management processes and others.
It is changing now with modern multi-tenant SaaS CAD and PLM systems capable to collect information and providing analytics. The differentiation in data management architecture is what can make a big difference and will allow the switch from data control to data analytics and intelligence. Check my presentation at IpX Symposium a few years about Digital transformation, manufacturing networks, and the next PLM paradigm shift. Networks are one of the most powerful concepts that can bring data intelligence. Understanding product data collected from design systems, recombining it together, and producing analytics that can help manufacturing companies to make optimal decisions in design, production planning, and supply chain is the key.
What is my conclusion?
The future power of the data can be only realized by using modern data management technologies and SaaS / Cloud architecture. The power of this architecture will bring the intelligence of product data in real-time to manufacturing companies. As we can see from several events, manufacturing companies are realizing the opportunity of acquiring engineering and manufacturing SaaS technologies, SaaS ERP, and PLM companies to improve their competitiveness. We are going to see more events like this in the future as the manufacturing industry is transforming. Just my thoughts…
Best, Oleg
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.
