The PLM industry was buzzing about cloud migration for the last decade. For all these years, industry analysts and researchers were following the progress the PLM market was making toward cloud migration. You can find some of my thoughts about cloud PLM from 2017 – PLM Cloud Adoption 2017 and you can SaaS PLM acceleration trends from 2021. In the last few years, we’ve seen a tremendous inflow of capital in the PLM industry. But the jury is still out watching the results.
The last two years demonstrated that all vendors were preparing for the acceleration of cloud, SaaS, and digital transformation. Massive amounts of investment were done in SaaS/Cloud PLM domains via the development of existing platforms by leading vendors (TeamcenterX, Dassault/3DX) as well as by acquisitions of independent companies (Onshape/PTC, Arena/PTC, Upchain/Autodesk, GI/Aras). These investments set the industry to a very high level of expectation, yet, the question of what will boost the acceleration of cloud/SaaS PLM is still open.
While software companies and investors became increasingly interested in the PLM business, the industry was debating many topics related to the transition of PLM software to the cloud. Customers, especially large ones, were concerned about data, migrations, available solutions, and processes that can be covered by cloud PLM systems. It was quite hard to find reliable information about product lifecycle management progress toward the cloud.
Cloud PLM Researches – CIMdata and Tech-Clarity
Back in 2021, CIMdata, the leading product lifecycle management consulting and analytic service provider announced the results of collaborative research on the benefits and challenges of Cloud/SaaS PLM adoption. Here is the conclusion made by Mr. Stan Przybylinski, CIMdata’s Vice President and leader of CIMdata’s cloud PLM research program.
This collaborative research program focused on helping answer vital questions about industrial companies’ ongoing and planned Cloud/SaaS-related PLM efforts. The report summarizes the analysis of a global survey targeted at industrial companies to highlight the issues they face in looking to make this move.
According to Mr. Stan Przybylinski, CIMdata’s Vice President and leader of CIMdata’s research program, “In our 2017 cloud study, about one-third of the participants believed they would move to the cloud in the next two years. If our respondents to this new survey are representative of the broader population, nearly 30% have already made the move and 86% of our respondents either already moved, plan to move in the near future, or have strongly investigated their options. This result agrees with our work with our industrial consulting clients and in our interactions with the leading PLM solution providers who claim huge increases in interest and growing adoption. This is great news for the PLM Economy.”
Earlier last week, my attention was caught by the Tech-Clarity publication announcing the results of their cloud PLM research – The State of Cloud PLM 2022 (PLM Survey Results). Jim Brown, the president the founder of Tech-Clarity is a well-known and very respected researcher in the PLM domain. The research was sponsored by Aras, and therefore the outcome was very interesting because Aras is focusing on very large PLM customers. Here are a few interesting data points I captured from the publication.
An amazing 93% of companies are either using, planning, or are open to using cloud PLM software, with only 6% not willing to use cloud PLM software. Which is a huge difference from what we’ve seen before. Another interesting perspective is remaining for customization.(note that for a very long time, industrial companies were super convinced that without custom deployments, cloud PLM has little to no change in large companies). According to Tech-Clarity, the majority of companies (75%) see PLM coming either out of the box or with “some customization and extensions”.
Cloud PLM Advantages
So, what makes cloud PLM software an interesting option for manufacturing and industrial companies? Here is my top 3 pick:
1/ One big advantage is that you can access your data from anywhere in the world, on any device. This gives you the flexibility to work from home or on the go, without having to worry about lugging around your laptop or accessing a VPN.
2/ Another key benefit is that cloud-based PLM lets you avoid upfront capital investments. With traditional deployments, you need to purchase and install hardware and software licenses – a costly proposition. But with cloud-based PLM, there are no such expenses. You simply pay as you go, based on your usage levels. This makes it an affordable option for businesses of all sizes.
3/ Finally, cloud-based PLM is scalable – you can easily add more users or storage as your needs grow. And because updates and maintenance are taken care of by the provider, you can focus on running your business instead of managing your IT infrastructure.
Moving to the Cloud? The PLM Devil In Details
So, can we conclude that the industry is fully convinced in cloud PLM migration and moving ahead towards the cloud? Not so fast, my friends. While the intention of large industrial companies is to come to cloud PLM, what is interesting is what will be the deployment speed and how fast these large manufacturing companies will be able to switch. In my view, three big questions need to be answered
1/ How easy new cloud PLM will be integrated into the existing eco-system of desktop, on-premise, and other applications and services
2/ How much flexibility, new cloud PLM software will provide to accommodate the needs of industrial companies in PLM and connected disciplines
3/ How manufacturing companies will be addressing data migrations with new cloud PLM systems or, in other words, how much data will be buried in the existing systems, and how sensitive it will be for industrial companies?
What is my conclusion?
The market is demonstrating super positive trends towards cloud PLM software. It looks like finally, the industry is moving and a fundamental shift will be achieved. Tech-Clarity research was mostly focusing on large industrial companies, which makes it especially interesting. The question of openness, integration, and flexibility will be on the top 3 positions in the last to decide about migration. However, industry migration creates huge timing opportunities for all new vendors in the market. Just my thoughts…
Best, Oleg
Disclaimer: I’m co-founder and CEO of OpenBOM developing a digital cloud-native PDM and PLM platform that manages product data and connects manufacturers, construction companies, and their supply chain networks. My opinion can be unintentionally biased.
