New White Paper

"Managing Projects Through-Life
Maximising the Return for Suppliers and Their Customers"

Today, the vast majority of business analysis focuses upon the “efficient” execution of day-to-day tasks - in the office, on the factory floor, in supply or in logistics.  Most IT developments are similar; they concentrate upon the transactional systems that support these activities.  This is a somewhat limited view of what is required.  Executives and Programme Managers need to define their strategy, to plan the way forward, to exercise effective and timely control over the “production” activities and then to decide whether/how to change their portfolio of investments. 

That is, management need a new set of capabilities that support what they do - a new over-arching business layer that does not exist today.  This sits above the task-orientated applications, providing a layer of integration and control based upon business focused fact.  This layer supports the development of strategy and programme planning - deciding upon direction;  the creation of more “effective” activities - doing the right things and doing them correctly;  plus broad-based, through-life governance, supported by more objective appraisal and change.  Finally, these new capabilities will bring substantial “efficiency” enhancements (productivity) – however, this isn’t its raison d’être.

The primary keys are first, being able to characterise how to achieve the objectives – viz. the business design;  secondly, to understand the true value of what has been done and where the business could go from where its finds itself.  Better decision making and the ability to govern with confidence require visibility, continuity and a recognition of the real business value of each process, asset, relationship etc. that make up the enterprise or business cycle.  These are founded upon high quality, contextually-based information.

Click here to download the White Paper.

Special Report

Dassault Systèmes - An Update

 November 2007

Following a series of reviews with Dassault Systèmes executives, this report discusses Datamation’s conclusions on their recent progress and long-term direction;  the comments reflect our view of the changes that seem to be taking place in the PLM marketplace.

Overview

In summary, there is much greater confidence in the Dassault Systèmes (DS) team;  this seems to result from good business results (always a help) and what appears to be the resolution of some sticky “challenges” that have constrained their capabilities over the last few years.

Their traditional “design” brands continue to expand with vigour – CATIA for sophisticated 3D design, SolidWorks for advanced but less demanding 3D design, SIMULIA for product simulation today encompassing the ABAQUS suite and DELMIA for digital manufacturing, now with some impressive capabilities such as “virtual” commissioning. 

ENOVIA is re-vitalised - the acquisition of Matrix-One has been very good for them and they have embraced its capabilities whole-heartedly.  This was not a “market-share” purchase but one where they intend to use Matrix to the full.  Their strategy for SOA strategy will be particularly important here over the coming months and years.  Work seems to be going on apace and this is very welcome. 

3DVIA is their latest brand, providing rapid and easy access to all forms of information, driven by their 3D theme.  Their focus is upon ease of use and innovation, to encourage all to embrace and use the 3D idiom – within engineering, collaboration across the business (manufacturing, support, marketing etc.) and, now, in the customer-base as far as the individual consumer.  At the lower end, they will be delivering “fun-to-use” services for use by you and me - to review products (experiential marketing), for use in training or for us to invent our own 3D objects, creating and sharing new “life experiences”.  The recent announcement of Microsoft Virtual Earth – 3DVIA is an example of where they might go. Their recent acquisition of the technical documentation software house, Seemage, strengthens their PLM-related capabilities in the delivery of 3D-based design information to downstream functions.

Direction

DS’ vision states “3D opens the door to the world we imagine”.  3D is in their DNA;  hence, they believe that the technological capabilities upon which they have built such a successful business can be used to open new profitable markets.  They have re-defined the PLM cycle to one that runs from the consumer (developing requirements and desires), through engineering of all forms, back to marketing, sales and the consumer. 

There is no doubt that 3D is much easier to understand even within the engineering community;  it does clarify intent and usage in ways that other media cannot.  Its relevance to new industries such as Consumer Goods and Apparel is clear.  Whether 3D is a true new “media” is not important;  however, it is a new and exciting part of the total information set that helps direct users to the harder, factual and, perhaps, more boring information. 

Nevertheless, the use of 3D by real consumers for non-business purposes is a totally new marketplace to DS and is a bold step.  We hope there is ready return here without significant investment and that some of the new techniques (such as in Virtools) can be used in the industrial domain.  Datamation believe that the real value of DS’ products lies in PLM and the use of PLM data throughout the industrial cycle.! 

Secondly, Datamation believe the nature of what customers are seeking is changing.  The move towards products plus services, products-as-services, commodity manufacturing and globalisation introduce new business stresses.  These have changed the nature of the traditional responsibilities and increased the overall risk.  Hence, manufacturers and their customers are looking for a more integrated, through-life and business-driven approach to operations, requiring a new set of thinking and extended “PLM” capabilities:

• Undoubtedly, the “Product” part of PLM, including process and asset design, is still important.  However, the “product” is now an inter-twined mix of deliverables - the operational entity (involving many additional disciplines such as software) + the delivery and in-service capabilities + any committed services including all the necessary internal support infrastructure + information + warranty + other liabilities + Brand Image etc.  The “P” in PLM is no longer the kind of design and manufacturing sequence it was 10 years ago.  It is very interesting to reflect, that if you were to re-classify BAE SYSTEMS today, would they be an aerospace company or an electronics and support services business?

• To address this, the “Lifecycle” element must include interaction with the real-world plus the proactive gathering and reuse of manufacturing, operational and support experiences.  Today, most PLM vendors, including DS, stop at the virtual to real-world boundary.  They deliver data to where it is used but they tend to shy away from providing tools that analyse true performance, assess the value gained by the customer or collate detail information on the issues that arise with the “product” in use.  Datamation believe this is essential in a today’s risk-driven and services orientated environment – creating elegant products is not sufficient.  Customers want to find ways of closing this loop that they see as fundamental to both internal business success and real ROI for the customer

• “Management”, therefore, has to encompass this complete lifecycle, not simply design tasks – cutting across all domains, introducing a more business rather than functionally orientated view.

DS’ CEO and President Bernard Charles put forward the view that we should forget the traditional IT boundaries between PLM, ERP, SCM, MRO etc.  That is, customers want solutions to problems, whatever their scope and/or the apparent constraints of the IT applications.  In Datamation, we endorse this view enthusiastically.  Today, however, it is the customer’s responsibility to design the environment and integrate the independent silos, even if they do call in systems houses such as IBM.  What can the PLM community do to help?

Integration is a large and complex subject.  However, as a first step, we would like to see the PLM vendors widen their scope to support some aspects of real-world activity.  “Engineering” should provide the heart of a through-life information backbone;  this would link the virtual and the real-worlds together based upon PLM’s “product” orientation and many of its business disciplines and methods.  Such a backbone would:

• Eliminate many of the data discontinuities that exist today - see our whitepaper “The Datamation PLM Model: PLM - How it can drive your business”

• Provide the feedback loop that is so important – for example, between MES, testing systems, MRO and SCM and the design community

• Allow the delivery of configured content (instructions, 3D models, training, analytics etc.) based upon the current configuration and condition of the product, not static design definitions.

We feel that the PLM vendors, including DS, are cutting off a substantial part of the potential market – not only in what they can offer to the downstream domains but the owner/operators as customer set.  This is particularly significant, as a subject area that they could address relatively easily;  tools such as Matrix-One and DS’ SOA strategy provide some of the capabilities that are required. 

The second step is somewhat larger.  Executives and managers responsible for product programmes want to integrate their activities around their raison d’être – making money whilst ensuring the maximum ROI and minimum hassle for their customers, whilst minimising business risk.  This requires more than simple data feeds between application environments or more advanced retrieval capabilities.  It needs a new layer in the architecture that operates at a level above the PDM, ERP, CRM and the other enterprise systems.  Again, PLM thinking, methods and capabilities have much to offer here – should the PLM vendors take the high ground or leave it to SAP, Oracle et al?  For more discussion on this topic can be found in the White Paper entitled “Managing Projects Through-Life - Maximising the Return for Suppliers and Their Customers”.

DS’ View of their Chosen Marketplace

Dassault Systemes are growing faster that the marketplace within their chosen domain – the virtual parts of the product lifecycle.  This was borne out by their 3Q results where software revenues grew >17% and they expect overall growth for the year of 14-15% (non-GAAP at constant currencies).  They believe there is sufficient opportunity in this arena, together with their expansion into new industries and their new ventures, to maintain this growth.  One area where an increase in revenues was not sustained was in services;  however with strong partners, they can focus upon “services-required-to-sell-software” rather than compete for day-to-day implementation income with the integration houses and their partners. 

Their perception of their marketplace has changed;  they now see three levels of user – the creator (the designer if you will), the collaborator (everyone one else in the virtual design environment plus users of this data e.g. through Seemage) and the consumer (through their 3DVIA strategy).  They are looking to serve all three markets but, at present, only “virtually”. 

Their relationship with IBM has changed but seems to be blossoming on all fronts.  Their split of the marketplace seems entirely logical.  IBM will be responsible for the thousand or so largest customers.  In doing so, they will continue to re-brand, manage and support CATIA, Enovia etc. as IBM products - a continuation of the process started in 1981.  Recently, the “IBM” product portfolio has been increased to include Delmia and Matrix-One – a very sensible situation for this customer set.  IBM will deliver the integration services through its SOA for PLM initiative and their consultancy group;  in addition, they can use their Lotus, Rational, WebSphere etc. capabilities to enrich the overall solution.  Finally, we perceived much greater co-operation/sharing of on-site support and consultancy – another win-win step forward in this transition. 

DS will address the rest of the marketplace, with greater emphasis upon DS’ PLM Express offerings and SolidWorks.  This will go through two DS channels based upon their wide range of experienced partners.  In addition, they are building a series of “Software-as-a-Service” offerings, aimed at the consumer marketplaces.  In this way, both DS and IBM seem to be betting on two horses and this should benefit all DS-based PLM customers, both large and small. 

DS are expanding into new industry sectors, the current seven growing to eleven:

• Aerospace, Automotive, Shipbuilding, Industrial Equipment as the “core”

• §High Tech, AEC, Consumer Goods, Consumer Packaged Goods as “growth” sectors

• Life Sciences, Energy and the Service Providers are their “emerging” sectors.

They are making progress in all of them including the very latest;  it is interesting to note that Aerospace and Defence plus Automotive now contribute significantly less than 50% of their total revenues.

Summary

Datamation believes there are good times ahead for DS and their customers.  Their breadth may be constrained by their “virtual-only” thinking and their other 3D pursuits;  however they are very strong in the things they do.  Combined with the systems integration capabilities of IBM some of these concerns begin to become less important.

However, if PLM is to continue to grow, to where it becomes the strategic enabler, then maybe we need to look more broadly at the subject – perhaps changing a little to address the needs of our most senior customers, most of whom are not in design.

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