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The Upside of AI – A Use Case for the PLM World

Bruce Bookbinder — Wed, 10 Apr 2024 14:00:00 GMT

As artificial intelligence (AI) is making headlines worldwide, it seems that the negative press has overshadowed the potential of AI to make positive impacts across many disciplines. This is nothing new. With any emerging technology, there are bound to be visionaries who foresee the potential to drive society forward and concerned groups who fear the misuse of new technology will create more chaos than good.

While the adverse effects of AI seem to be getting the most attention, and there is certainly cause for concern, I don’t believe many of these people understand the upside of AI. I believe the misunderstanding lies in the complexity of AI and the intricacies of applying AI to the highly developed processes it will significantly improve. In industry, many companies have not taken the appropriate time to understand the relevant use cases. Instead, they have committed to AI as a technology and then started searching for a problem to solve.

A PLM Use Case

Let’s look at a realistic PLM use case and compare how it could be handled before introducing AI and how AI might facilitate the same scenario. I realize I am oversimplifying the process for the purpose of the blog, but I think this is a good example to make the point.

Let’s assume we are a company designing, manufacturing, installing, and managing wind turbines worldwide with an installed base of roughly 10,000 units. A very astute engineer reviewing IOT data has noticed the efficiency of several turbines has unexpectedly decreased over the past few months. These units are located in different locations and, on the surface, do not have any noticeable differences from other installed units.

Previously, an engineer might start identifying the issue, determine why only specific units are affected and what they have in common, and create a corrective action plan for the field. Even if his company has a somewhat developed Digital Thread where much of the company’s product data is effectively connected, the process will take some time as he researches and analyzes potential root causes and other related issues.

In a company where AI is employed, the engineer would direct the technology to research several possible scenarios. AI could quickly run through the company’s Digital Thread and additional outside data points to determine what may be causing the loss of efficiency and draw conclusions regarding what is unique among these wind turbines. It could look at data from outside the company’s internal digital thread, like unusual weather patterns that could impact the turbines' operations or perhaps quality issues from part data maintained by third-party suppliers. This information could be combined with internal activities like design changes and maintenance activities on the wind turbines.

In my use case, I imagine the affected wind turbines had the same upgrade performed with their recent maintenance activities. The upgrade contained a newly designed component replacing parts of the original design. Under the engineer’s direction, AI could connect the upgraded component with unusually hot weather in the regions where the affected wind turbines reside, potentially causing a degradation in performance.

Based on previously established models, AI might also look back at the requirements of the original component pulled from the Digital Thread to see the original design intent and determine possible root causes. (See The Future of Product Innovation and PLM – Abstraction, Digital Threads, and Artificial Intelligence by Paweł Z. Chądzyński for an excellent article on this topic.) Perhaps the requirements in the original design would indicate temperature tolerances for parts to reduce the risk of losing the unit's efficiency if temperatures reached a certain level. Looking at the upgraded component from the as-maintained BOM in the Digital Thread, AI can verify the parts used did not meet these requirements and prescribe recommended changes to Engineering. I think we have something here.

I am also imagining that the value of having AI wouldn’t stop there. AI might analyze if any other wind turbines in the installed base are at a high risk of developing efficiency issues due to using inappropriate parts and create a recommended plan with options for service teams to address the issue in the field based on location and severity.

AI can also be trained as a virtual assistant to support meeting planning, task organization, and approval workflows, including updating customer-facing, manufacturing, and service documentation.

Of course, the most important part of this whole scenario is verifying the data and assumptions AI is proposing. The work of experienced, knowledgeable engineers and other subject matter experts is vital to authenticate the findings. AI may only introduce partial solutions based on the models it is working from, but it takes human intellect to know how to interpret the information, direct AI’s additional analysis and conclude what is best for the situation. Engineers and their counterparts always need to be the decision makers in the process.

AI, Digital Thread, and the Cloud

To reiterate an earlier point, while the scenario is a realistic example of an issue that could happen in a business, how the business would react and how the plan would be executed is certainly an oversimplification. What is foundational to be able to work in this advanced state are the critical technologies for AI to operate effectively. Let’s talk about the Digital Thread, AI, and something that hasn’t been mentioned yet, the cloud.

Digital Thread and AI

The digital thread is not a new concept, but not all companies have fully embraced the strategy yet, and that will be an issue for them. As AI continues to develop and establish itself in the day-to-day operations of a business, the amount of data it will demand to effectively analyze complex scenarios will grow exponentially. A digital thread gives companies a strong foundation to grow their analytical capabilities and provides AI an effective design to access and relate data. The greater the quantity and quality of data AI has to work from, the better results will be created. (Garbage in/garbage out – some things never change.)

As AI continues to develop and establish itself in the day-to-day operations of a business, the amount of data it will demand to effectively analyze complex scenarios will grow exponentially. A Digital Thread gives companies a strong foundation to grow their analytical capabilities and provides AI an effective design to access and relate data.

Data-as-a-Service

Another interesting option to consider is Data-as-a-Service. A good example to consider in the PLM space is how companies will manage regulatory and compliance requirements. Staying current with the growing number of requirements is time-consuming and expensive. With Data-as-a-Service, a company can subscribe to a third-party supplier of regulatory requirements data delivered in a format that would be easily consumable by a PLM system or requirement management system making it accessible by a company’s digital thread.

The supplier would be responsible for keeping the requirements current and modifying them as necessary as well as providing business use cases for an organization to follow for testing and other activities. The data would provide higher data quality, increased detail and more up-to-date information to a company’s digital thread. This and other examples like this illustrate how a company’s digital thread will grow from outside sources with minimal effort from its own internal resources.

From Rob McAveney’s (Aras CTO) ACE 2024 keynote presentation “On the Thread to What’s Next”

And of course, the Cloud

No technology conversation is complete without understanding the role of the cloud and SaaS. With AI’s need to process vast amounts of data to produce accurate and complete results, IT organizations will need to scale their environments faster and more effectively than ever. Additionally, AI will need data from inside and outside their internal environments, connecting new sources of data to their Digital Thread quicker than ever anticipated. More data, more connectivity, more processing power, more security, more flexibility, more everything. If a company’s data center hasn’t struggled to keep up with the increasing demands of their organization yet, AI will certainly stretch its capabilities to the limit.

The other point to consider is the role of SaaS. As AI is forcing the hyper-growth of the Digital Thread discussed above, there will be an increasing need for the technical specialists of PLM solutions to manage the increasing complexity of the system. These professionals are expensive and often difficult to find. Many companies are looking to their PLM providers to supply the necessary expertise to manage growth through SaaS offerings. For companies already on SaaS, congratulations! You are already one step ahead of your competitors.

In conclusion...

The idea of AI-infused engineering starts with data – new ways of tracking and visualizing thread-connected information will emerge to help us see problems from new angles. None of us should underestimate the impact AI will have on the future of engineering. We should be embracing the idea that repetitive or non-value-add work can be done by a machine.

Sometimes it is hard to conceptualize the future, especially when it involves complex ideas that only the experts in a particular discipline truly understand. While some may be fearful of AI, this may be because they only see the simple use cases that potentially create harm. These concerns are certainly valid and must be governed if AI is to succeed, but understanding how AI can effectively prevent disasters is also a valid conversation that needs to be discussed. Let’s say I change my earlier scenario to the following,

On the morning of Tuesday, say, January 28, 1986, somewhere in Florida, a very astute engineer sits down at his desk and reads an analysis from his AI assistant. After analyzing the data, AI has concluded that due to the record-low temperatures in the area, two small parts, O-ring seals, were at risk of failing on the launch of the space shuttle. AI ran several simulations, and they show that there may be a failure of the primary and secondary redundant O-ring seals in a joint in the shuttle's right solid rocket booster (SRB). Perhaps with this level of solid evidence provided at the right time, the Challenger launch would have been delayed.

Just saying.

Be sure to join Aras at our webinar “From Regulation to Reality: Harnessing AI to Extract Regulatory Requirement into PLM” on Tuesday, April 23, 2024 at 4:00 p.m. CEST. The webinar explores the future of product compliance management, where AI-driven automation and PLM integration converge to redefine product development processes and ensure compliance from regulation to reality. The webinar will be held in English.

Also, take a look at Rodrigo Britto Maria’s latest blog “PLM Tales in Space: Aras Innovator and the Digital Thread” for an interesting look at why Aras Innovator is a PLM solution for the space industry.

The Unstoppable Momentum of PLM SaaS

Bruce Bookbinder — Tue, 09 Jan 2024 12:30:00 GMT

In my blog 3 Predictions Impacting the 2023 Enterprise PLM Cloud Market, I predicted that “…as companies find that managing complex PLM deployments on the cloud requires more than just cloud technology, but also the skills to manage it effectively, the importance of PLM SaaS offerings will accelerate quickly in 2023.”

So, where are we now? Are we seeing the predicted acceleration of PLM SaaS?

While reliable statistics on PLM (product lifecycle management) SaaS adoption are hard to come by, there are many indications that the PLM SaaS business is picking up steam quickly. For example, Aras recently reported “accelerated growth of its SaaS business from both the migration of existing Aras Innovator^® customers to SaaS as well as new customers choosing SaaS. In the first three quarters of 2023, Aras had more than 50% year-over-year growth in SaaS deployments for its Aras Innovator platform.”

Other large, traditionally on-premise PLM providers have also indicated that their SaaS offerings and investments in innovative technology have increased significantly in 2023. At the Siemens Realize Live conference, the company discussed the rapid adoption and growth of the cloud version of Teamcenter. Meanwhile, PTC reaffirmed their continued investments in their cloud delivery strategy at LiveWorx.

SaaS is something to talk about

With Gartner^® forecasting “Worldwide Public Cloud End-User Spending to Reach Nearly $600 Billion in 2023,” this amounts to a “21.7% increase from the previous year.”¹

There is no reason to believe the move to SaaS will slow down any major enterprise software deployment. This is especially relevant for PLM, where cloud adoption initially lagged behind other types of enterprise software.

Gartner continued by saying, “Cloud computing is driving the next phase of digital business, as organizations pursue disruption through emerging technologies like generative artificial intelligence (AI), Web3 and the metaverse.”¹

This connects well with Aras CTO Rob McAveney’s comments made recently during the webinar Aras Hot Takes: Providing our PLM Perspective on the latest News Headlines (starting at 24:12): “The move to cloud-based PLM is going to accelerate this process (AI)…on the cloud, you have access to AI services that are not really available in your data center. You have access to computing resources that you do not have with your on-premises deployment. You have access to external data - the entire internet of data that can be used to train those models.”

With PLM serving as a critical enabler for digital business transformations - which is partly driving cloud growth - it is a safe bet that the PLM SaaS space will continue to grow quickly, making up for the lackluster start of its adoption several years ago. Gartner also predicts that “by 2026, 50% of midsize and large manufacturers will adopt SaaS — PLM, design, and simulation — tools compared with fewer than 20% today.” That’s a lot of ground to cover in two years.

Aras customers adopting SaaS

As mentioned earlier, Aras has seen considerable growth in SaaS deployments over the past two years. Let’s look at a few of Aras’ new SaaS customers and how they leverage Aras Innovator in the cloud to drive their organization forward.

Red Bull selects Aras Innovator PLM platform

Aras’ SaaS-based application platform will be integrated into Red Bull’s existing SAP S4/HANA and enterprise application infrastructure. In addition to handling the company’s complex recipe management, it will provide support for compliance concerns and ensure a seamless connection with the company’s global partner network. This is a crucial factor as Red Bull is active in 175 countries and sells more than 11.5 billion cans of its energy drink each year.

As a global company with a growing portfolio, it is essential that Red Bull has a solution in place to ensure all parties have access to the most accurate and up to date product data that adheres to the regulatory compliance standards of the food and beverage industry.

Aras Innovator will enable Red Bull to configure their PLM solution to meet their unique needs as well as adapt it to respond to new requirements or take advantage of new innovation. In the food and beverage industry, regulatory standards require very precise information about ingredients and supply chains. This becomes even more complex in the case of Red Bull where production and sales are global. The digital solution behind it must combine scalability and flexibility so the entire end-to-end process can be accurately managed and monitored.

Red Bull comments: “Transparency and security throughout the entire supply chain is crucial for us as a global beverage manufacturer. Aras Innovator provides a unified environment that allows all users of product information to collaborate around a single set of processes and data.”

H-TEC SYSTEMS drives business growth with Aras

H-TEC SYSTEMS, part of MAN Energy Solutions SE, is a technological pioneer in the cost-effective and reliable production of green hydrogen. Aras Innovator empowers H-TEC SYSTEMS to support the complexity of its projects and adapt over time to manage the requirements of new applications.

With Aras Innovator, H-TEC SYSTEMS gains new flexibility built on a robust set of platform services that can be easily extended leveraging a modular structure. This enables H-TEC to be more responsive to customer needs and give the company more comprehensive visibility of its data.

H-TEC comments: “It was important to us that we could easily integrate further systems and applications in the future via existing interfaces. Thanks to its adaptable and open architecture, Aras Innovator enables us to achieve this. This means we can quickly integrate existing and new applications or authoring systems from our various departments. The combination of a cloud-native solution and open system architecture guarantees both horizontal and vertical scalability.”

SaaS platform improves traceability of automotive components³

To eliminate the problem of different software programs to trace parts at each division during product development and assembly, Kendrion implemented a single PLM platform across all divisions. The objective of the approach was to improve their ability to integrate new tools and processes.

Kendrion liked Aras Innovator’s capability to customize the platform for each application on a SaaS platform easily. A low-code DevOps feature ensures the reliability of this integration and deployment to improve each product’s overall time to market.

Kendrion comments: “Cloud-based PLM enables greater resiliency across the lifecycle, and Aras provides a flexible approach that is necessary to create, manage and optimize a dynamic digital thread.”

Join us at ACE 2024

If you would like to find out how moving to the cloud will help you keep pace with your latest business transformations or if a PLM SaaS deployment better fits your future business strategy, you need to attend ACE 2024, March 4 – 7!

You can join product lifecycle management experts from around the world to explore the latest in PLM innovation and meet with Aras experts to build connections. You will gain valuable skills and expertise while exploring new perspectives on the technology and industry trends reshaping the business of innovation.

¹Gartner, Gartner Forecasts Worldwide Public Cloud End-User Spending to Reach Nearly $600 Billion in 2023, April 19, 2023. https://www.gartner.com/en/newsroom/press-releases/2023-04-19-gartner-forecasts-worldwide-public-cloud-end-user-spending-to-reach-nearly-600-billion-in-2023. GARTNER is a registered trademark and service mark of Gartner, Inc. and/or its affiliates in the U.S. and internationally and is used herein with permission. All rights reserved
²Gartner, How to Plan for a Successful Adoption of SaaS PLM, By Sudip Pattanayak, Marc Halpern, Alexander Hoeppe, Christian Hestermann, 20 January 2023
³Assembly Magazine, SaaS Platform Improves Traceability of Automotive Components, August 2022

De-risking Your PLM Should be Your Number One Priority

Bruce Bookbinder — Wed, 08 Nov 2023 13:04:00 GMT

A note from the author:

Last year, I published a blog on how organizations invest their time and resources in de-risking their PLM solutions. A year later, the number of conversations on this topic has continued to grow as companies are increasing their digital transformation efforts. I felt it was worthwhile to republish the blog for those who may have missed it the first time or to take another look at the content. The webinar “How to De-risk Your PLM Environment Before it’s Too Late” is available online and includes more detailed information on the subject.

What does de-risk mean?

The term “de-risk” is certainly not new in today’s business vernacular, but lately, it seems to have worked its way into just about every conversation with our PLM customers. “De-risking,” a system encapsulates what organizations deem critical for their systems to remain relevant. While de-risking might imply a one-time activity to improve the current state, this is short-sighted. The process of de-risking a PLM system should entail a series of long-term activities that establish the processes and environments to prevent major threats from impacting an organization.

The question to ask is, “What is involved in de-risking a system?” While it is fair to assume most people would associate the improvement of a system’s security posture as de-risking, this view limits the potential benefits of the concept. Improving a company’s security capabilities is a major part of de-risking, but it only covers one element. De-risking should involve more than security. De-risking should address the system’s ability to transform quickly and significantly to react to unforeseeable global events or unexpected business activities.

Why are we talking about de-risking PLM now?

Ensuring stable and secure enterprise systems while making necessary pivots to support changing business rules and technology has always been the fundamental objective of an IT department. What IT departments face today goes well beyond the definition of simple pivoting and can best be described as frequent changes and substantial swings in the core functionality within systems. These swings are often the result of unexpected global events that affect the structure of how a company operates, instantly creating new organizational paradigms for enterprise systems to support. Enterprise systems must quickly manage these new and complex requirements so business operations are not affected by new paradigms.

While executives hoped the significant impacts of recent global events on their business operations was a once-in-a-generation event (for instance, the impact of a massive global supply chain disruption), they have reluctantly accepted the reality that these events are only the beginning. New risks due to extreme pressures on energy prices, political upheaval, and governmental mandates on manufacturing have forced a new, de-risking priority for how enterprise systems are built, deployed, and managed. The process of de-risking helps minimize the chance of companies being affected by these and other, as yet unseen, threats.

Three ways companies de-risk their PLM environment

IT professionals recognize de-risking an enterprise PLM system involves multiple areas and, ideally, begins long before a system is implemented. Critical areas include security and compliance improvements, better elasticity of the environment, and utilizing a flexible platform for application changes.

Let’s look at three examples of how companies are de-risking their PLM:

1. Security and compliance – First and foremost, improving the environment’s security posture is where de-risking should begin. To accomplish this quickly, companies are looking to the cloud. Large cloud providers like Microsoft Azure, AWS (Amazon Web Services), and GCP (Google Cloud Platform) maintain the most secure data centers in the world. With an incredible economy of scale, these cloud providers guarantee the latest technology and the best security professionals are there to protect customer data and prevent cyberattacks. Large cloud providers offer a value proposition that individual companies, even the largest in the world, cannot match.

Additionally, a few PLM SaaS offerings available today maintain certifications to guarantee the security, availability, and confidentiality of critical data. Certifications ensure the SaaS provider’s internal processes are regularly reviewed and approved by independent organizations.

2. Elasticity of the environment – Events like company mergers and acquisitions, shifting business partners, new collaborative processes, and changing supply chains affect how PLM environments are designed. As organizational paradigms change, so does the size of the user base, where users are located, and the peak times of system usage. Additionally, as system functionality changes, the volume of information being stored or accessed within the system will likely increase significantly but may even decrease. Reacting to these shifts means you must have the proper infrastructure available, in place, and correctly configured to maintain acceptable response times. This requires the elasticity of the cloud. Cloud providers maintain a nearly unlimited capacity and have tools to add or remove capacity instantaneously.

As users shift to new locations around the world, large cloud providers can also shift the location of a customer’s data center to a data center physically closer to the users, reducing network latency. Regardless of the threat affecting the business, the cloud enables companies to de-risk the impacts of managing the environment’s capacity and the risk of system disruptions due to ever-evolving system landscapes.

3. Flexible Platforms – For years, most enterprise PLM systems have been notoriously difficult to customize to a customer’s specific requirements. New use cases and the subsequent changes to the application’s business logic came at a hefty price. Besides the cost of making the system changes, the modifications often created technical debt. Fulfilling new requirements through customizations negatively affected the system’s ability to upgrade in the future. This led to companies postponing upgrades and delaying the value of new functionality provided by the vendor.

(Read more in the insightful CIMdata report, Deferred PLM Modernization Delays Time to Value.)

Fast forward to today. The volume and scope of new business changes are creating a nightmare for PLM systems that were not built to change with new system requirements. Several major PLM vendors have developed cloud offerings based on their flagship solutions but have not improved the capabilities to support changing business logic.

The only way for a business to de-risk system functionality changes and gaps is to use a PLM platform that provides low-code capabilities that allow the business to quickly modify applications and create new functionality as needed. The platform should be built with the ability to customize the system without creating technical debt that could impact future upgrades. Additionally, the best SaaS offerings work within a DevOps culture to ensure the continuous integration and continuous delivery (CI/CD) processes are automated and extremely efficient.

90% of respondents from a recent Tech-Clarity survey responded that the importance of PLM customizations is “critical” or “very important.”

Final thoughts

Recently, there has been a significant increase in companies adopting the cloud for their PLM deployments with many also subscribing to new PLM SaaS offerings. It is not a coincidence that there are also a growing number of de-risking projects across the industry. I can’t say which of these efforts drove the other, but clearly, there is a natural synergy between these since cloud deployments and some SaaS offerings provide the foundational capabilities to support new de-risking efforts.

62% of respondents from the same Tech-Clarity survey replied they are “currently using” or “planning to use” a cloud PLM.

There is one PLM SaaS solution on the market that provides all the foundational capabilities necessary to “de-risk” the issues that come with today’s unpredictable business environment. Aras Enterprise SaaS has been called a Generation 2 PLM SaaS leader by CIMdata. Find out more by reading the analyst commentary, Aras Enterprise SaaS: A Gen 2 Leader.

To learn more, watch the on-demand webinar “How to De-risk Your PLM Environment Before it’s Too Late.” Aras executives discuss how Aras Enterprise SaaS de-risks your PLM environment from today’s biggest threats.

PLM Customizations and De-customizations: How SaaS is Changing the Future of PLM

Bruce Bookbinder — Wed, 25 Oct 2023 11:55:00 GMT

In a perfect world, companies could implement software (even complex, enterprise-scale solutions), turn it over to users quickly, and start benefiting from the system’s functionality. Reality is rarely so kind. Organizations, huge ones, have their unique processes in place, and they are not always based on the same industry best practices as a vendor’s solution. These functionality gaps can be resolved in several ways. The company can:

Change their existing processes to adopt the out-of-the-box (OOTB) functionality.
Establish manual workarounds of the system for the users to follow.
Create a new technical solution outside the new software and interface the information back and forth.
Customize the new software.

Unfortunately, these approaches often create long-term problems in the form of data quality issues, decreased user productivity, or increased complexity to maintain all involved systems. We are going to take a look at the “customize the software” option in today’s blog.

The impact of customizing your PLM

A common approach to quickly fulfill a company’s unique business requirements is for programmers to customize their new system. This involves changing the vendor’s business logic or even developing entirely new functionality right in the vendor’s code base. Customizing a system is not necessarily an issue if the solution has been designed to be customizable through low-code capabilities and the use of flexible platform services. With these capabilities, the solution can support the organization’s customizations without impacting the system’s ability to implement future upgrades.

Unfortunately, few PLM solutions, especially those designed decades ago, are built to handle customizations effectively, and the results are often painful. In these cases, the amount of technical debt continually increases, leaving inefficient or non-strategic code in place. This increases the overall maintenance of the system and leads to drastic increases in time and effort needed to execute upgrades to keep the system up to date with their vendor’s new functionality. A very interesting analysis of the impact of customizations and how they affect various PLM solution’s ability to stay current with upgrades can be found in the CIMdata analyst report, “Deferred PLM Modernization Delays Time to Value.”

Another study by Tech-Clarity confirmed the same impacts. As Jim Brown concluded in “The State of Cloud PLM 2022,” “The potential negative impacts of system customization are well known. Modifying software systems is frequently cited as the reason that companies find it difficult, or impossible, to upgrade their PLM system. Many can’t overcome the ‘technical debt’ of reapplying modifications because their solution is not designed to accommodate customizations and maintain upgradability.“

Regardless of the risks of customizations, IT departments continue to use this technique for a vast majority of their functionality gaps when their PLM solution does not offer a better approach. Tech-Clarity’s research (below) shows fewer than one out of five primary PLM solutions can be implemented without some level of customization or extensions.

From “The State of Cloud PLM 2022,” Tech-Clarity

PLM customizations and SaaS

Along with the rest of the software industry, PLM software providers and customers are looking to leverage the benefits of the cloud. With the cost and complexity of managing a typical highly secure, global PLM deployment, companies are also interested in SaaS offerings to take advantage of their provider’s technical expertise. This has created an interesting issue for PLM software providers playing in the SaaS market.

How can PLM providers support years of customizations in a SaaS offering while simultaneously standardizing their applications to take advantage of the SaaS business model?

Well, it seems most of the largest PLM providers are punting the ball (yes, it’s football season). We have seen the phrase “de-customize the applications” increasingly thrown around by some PLM providers when their customers want to move to the SaaS offering. It seems the prerequisite for moving forward is for customers to go backward. The “solution” often is to remove the existing customizations and adopt OOTB functionality or one of the other options listed at the beginning of this blog. Of course, if it were possible to work with OOTB, PLM owners would have done it from the beginning. What makes “de-customization” unrealistic is that many of the customizations reflect the uniqueness of their customers, providing a competitive advantage in their industry. Why would a company want to throw away years of customizations when it may be the most valuable part of their entire system?

The data points below really drive the point home. Tech-Clarity’s survey results shared in the webinar, Let Business Value Drive Cloud PLM Transition, show companies sending a clear message to PLM providers that “going backward” on the level of functionality is not an option for migrating to the cloud. They also strongly state that keeping their ability to customize is mandatory as a critical enabler to their digital transformations.

Willingness to Trade Functionality for Cloud Benefits

Importance of PLM Customizations

As the cloud changes PLM solutions, Aras continues to lead

For over twenty years, Aras has been delivering a flexible, low-code PLM platform that supports unlimited customizations. With the same functionality and capabilities of the on-premises deployment, the SaaS deployment continues to ensure that all of the customer’s unique functionality will be available after the standard upgrade process. Customers will stay updated with Aras’ roadmap while maintaining valuable customizations. This is the only way to ensure the value of a PLM solution will continue to increase as the solution grows and becomes more complex. CIMdata calls Aras Enterprise SaaS a “Generation 2 Leader.”

“Aras Enterprise SaaS is a SaaS PLM solution that meets and exceeds CIMdata’s Gen 2 definition. It offers full PLM functionality, suitable for companies with complex products and a high design content. The solution is fully configurable with no limits on the applications that can be developed or the underlying data model.”

Find out more

To learn more about the Aras SaaS offering or how business drivers are helping businesses justify the move to the cloud, read CIMdata’s commentary, “Aras Enterprise SaaS: A Gen 2 Leader,” or watch the recent Tech-Clarity webinar “Let Business Value Drive Cloud PLM Transition.“

Where is Your PLM SaaS Business Case Hiding? Webinar Recap

Bruce Bookbinder — Thu, 21 Sep 2023 12:47:00 GMT

Aras recently hosted the thought leadership webinar “Let Business Value Drive Cloud PLM Transition.” We explored how businesses can establish the value of cloud PLM, highlighting SaaS PLM solutions to help drive a successful business case for migrating their PLM. Jim Brown, president of Tech-Clarity, joined me to discuss the details of his recent white paper “Achieving the Business Value of Cloud PLM.” Jim examined industry trends and recent survey results on current business attitudes and strategies for cloud deployments to create valuable guidance on the future of cloud solutions.

The takeaway: Jim reinforced the necessity for businesses to focus on the “right” SaaS PLM to enable the company’s business transformational objectives, not just their cloud adoption strategy. By leveraging survey results from their research published in “Business Strategies for Long-Term Business Sustainability 2022” (Figure 1), he emphasized that the business case for migrating to SaaS PLM needs to support the success of organizations’ changing business priorities, not just cost savings.

Figure 1

So what does it mean to be the “right” SaaS PLM solution? Jim used additional survey results (Figure 2) from the eBook “The State of Cloud PLM 2022,” describing the strong attitudes of businesses towards flexibility in their PLM solution. When discussing why other enterprise systems initially moved faster to the cloud than PLM, Jim determined a major factor can be attributed to the lack of functionality in the earlier available SaaS PLM solutions. He also has seen this trend changing and believes the recent increase in migrations directly correlates to improved capabilities in some SaaS solutions.

Figure 2

Finally, Jim outlined different cloud options available to businesses, highlighting the maturity level and tradeoffs for different categories (Figure 3). He stressed that findings from Tech-Clarity‘s research were that manufacturers that use solutions with low-code capabilities are more successful in meeting their business objectives. As Figure 2 shows, “…manufacturers that use low-code development are over three times as likely to be able to fill their digital transformation gaps ‘very well.’”

This point reinforced the theme that the value of cloud and SaaS PLM is firmly established with its ability to help deliver business transformations effectively. Historically, low-code PLM solutions can deliver solutions for a company’s unique and complex challenges, and this shouldn’t change based on the deployment approach. Without these low-code capabilities, business transformation programs have a higher risk of budget overruns or even failure as a worst-case scenario.

Figure 3

Where to get more information and five critical takeaways

To learn more about developing the right cloud PLM strategy, read Tech-Clarity’s white paper “Achieving the Business Value of Cloud PLM”. Additionally, to help you develop your own cloud strategy, many valuable data points from Tech-Clarity’s extensive research can be found in their eBook “The State of Cloud PLM 2022.” Of course, you can also go back to this webinar, “Let Business Value Drive Cloud PLM Transition,” to review any of the points you may have missed.

Figure 4

For more information about Aras’ SaaS offering, take a look at the CIMdata Analyst Commentary, “Aras Enterprise SaaS: A Generation 2 Leader.”

Where is Your PLM SaaS Business Case Hiding? Part 2

Bruce Bookbinder — Thu, 24 Aug 2023 12:04:00 GMT

This blog is the second installment of a two-part discussion on how to uncover the value of PLM SaaS. In this post, I’ll discuss how the right solution will improve IT capabilities and support future growth and the complexity of a PLM system.

Last year, Tech-Clarity conducted a survey of over one hundred manufacturers to understand their cloud strategies. The results stated, “…about three-quarters of companies favor, prefer, or mandate the cloud for their new software selections. In fact, only 4% of responding companies say they do not consider or allow the cloud.” This statement was particularly interesting because Tech-Clarity reported, in an earlier survey, “Only 17% of companies participating in our 2018 study had a software strategy that called for only using the cloud, using the cloud unless no capable solution was available, or preferring the cloud.”¹

Similarly, CIMdata recently stated in their 2023 Market Analysis Report Series, “In most of CIMdata’s industrial consulting engagements today, the question is “why not cloud?” with a lot of push coming from corporate IT and even the C-suite.” ²

While these data points demonstrate the strong intention of organizations to move their systems to the cloud, they have been hesitant to migrate their PLM solution.

So, what is taking so long?

Building a compelling business case

Part 1 of this blog series discussed the difficulty many organizations experience creating a business case for migrating their PLM to a cloud SaaS solution. While the justification for moving to a SaaS offering may intuitively make sense to most IT professionals, it is often difficult to express the strategy's benefits and return on investment (ROI) within the constraints of an Excel template. The earlier blog examined how a favorable business case focuses on investing in a flexible cloud PLM solution to improve business transformation capabilities rather than just the tactical adoption of a cloud strategy. In other words, the right SaaS PLM creates value by enabling the company’s business transformational objectives, not just its cloud adoption strategy.

Choosing the right PLM solution means favoring functionality with flexibility while at the same time using industry best practices to support a company’s transformation vision are critical to the long-term success of the investment. Being able to exploit the solution’s flexibility with contemporary technology and professional expertise enhances the solution’s growth and value.

A few of the many examples of valuable cloud functionality and processes include:

The use of cloud services in the architecture
Adherence to independently certified best practices for security, confidentiality, and availability
The ability to monitor and quickly adapt the solution and system architecture of the ever-changing PLM solution

Adding value to business transformations

Executing a business transformation rarely goes as planned. Business conditions usually change throughout the development process leading to changes in requirements or even the objective of the program. Since PLM systems often play a critical role in the execution of a transformation, it is important that the system in place can adapt quickly to evolving requirements. PLM on the cloud brings unique capabilities to help mitigate the impact of change.

As a simple example, let’s say a company’s business transformation plan changes to include a significant number of additional users from different parts of the world due to an acquisition and reorganization. A PLM cloud deployment can add capacity without the overhead of procuring new hardware and, if necessary, move the location of the system’s primary data center to a different data center physically closer to the users – all while already having local support resources. If the PLM deployment is on the cloud, this process would have minimal impact on the project architecture.

Differentiators for using the cloud over a traditional on-premises deployment can usually be attributed to one of two categories:

Working with the benefits on a massive scale. Major cloud providers have the capabilities to work faster and more effectively than a company’s internal data center. From recruiting and retaining the best technical expertise, investing in automation tools, or maintaining a nearly endless amount of hardware, they can provide a faster time to value and better total cost of ownership for the PLM system than an organization’s internal IT function.
The best people working on the right tasks. When system architecture tasks like designing and implementing the infrastructure are offloaded to a cloud provider, critical internal resources can focus on the solution architecture. By utilizing company and business-specific knowledge more effectively, these expensive resources will add more value to developing the organization’s transformation plan than working on the design of the cloud’s system architecture. The cloud provider already has cloud experts on hand and can execute the tasks equally well, if not better.

The chart below (Figure 1) provides a more detailed view of how the benefits of the cloud can impact a company’s business transformation effort.

Figure 1: Cloud impact on business transformation efforts

Expanding the cloud’s value with Software-as-a-Service (SaaS)

While companies are able to gain value from the cloud through infrastructure-as-a-service (IaaS) deployments, they may also be missing a big opportunity. While IaaS provides the infrastructure and resources to best manage the cloud architecture, it leaves the customer to manage the deployment of the enterprise software on their own.

PLM solutions can be very complex to implement due to large volumes of data, highly secure IPs, integrations with other systems, and the global footprint of many customers. Since most companies are not able to retain specific technical expertise for every enterprise application, they may not have the experience to optimally configure the architecture for a specific system.

These gaps can easily lead to systems or performance issues that take time and consultants to correct. This is where SaaS PLM adds value. There are several software vendors that offer flexible SaaS PLM solutions employing the most knowledgeable product professionals. These technical resources specialize in the PLM product and ensure the architecture is designed specifically to leverage the best of the cloud.

Working with a SaaS offering also provides customers with a more streamlined support process. When a customer experiences a production issue with an IaaS deployment, it is up to the customer to coordinate with the cloud provider, PLM software provider, third-party software provider, development partners, and anyone else to determine the root cause and coordinate with the vendors until a solution is implemented. Suppose a system becomes unavailable with a SaaS deployment. In that case, the SaaS vendor is often responsible for coordinating and correcting the issue, regardless of whether it’s a cloud or software issue.

Individuality in a SaaS world

Henry Ford once described the customer options for his Model T Ford, stating, “Any color the customer wants, as long as it's black.” He might have enjoyed today’s conversations between many PLM software vendors and their customers, where vendors inform customers that in order to move to their SaaS offering, they will need to remove or “de-customize” years of custom functionality in their PLM solution. Many PLM products have limited or eliminated the customer’s ability to customize their SaaS solution to meet specific, individual requirements. This is not a realistic approach and is not sustainable for any large company. Tech-Clarity’s research concurred by stating:

“Manufacturers must recognize the need to manage the lifecycle of the enhancements and understand the ability for their cloud PLM architecture and policies to support effective customization. The State of Cloud PLM 2022 survey found that a full 87% of manufacturers that customized PLM say they will at least "most likely" need to keep their customizations when they upgrade their PLM system, and 40% say they "definitely" will. Therefore, it's vital to minimize the ongoing support cost, sometimes called the "tail" or "technical debt." ³

For SaaS PLM to provide value in business transformations, the technology of the PLM solution will require the ability to customize the solution to meet customers’ requirements. Furthermore, these customizations must be upgradable on the customer’s schedule. As Gartner^® stated in “How to Plan for a Successful Adoption of SaaS PLM.”

“Assure that the needs of customizations for your enterprise PLM are met. The SaaS PLM model encourages the use of out-of-the-box functionalities and maximizes the use of configuration. At the same time, PLM vendors must support required customization capabilities. This support can be in terms of extended SaaS custom services, providing DevOps-based custom code deployment process and plugins and open APIs, including low-code, that allows rapid customization within a set of specific guidelines.” ⁴

Learn more!

Gartner’s strategic planning assumption for PLM solutions asserts “By 2026, 50% of midsize and large manufacturers will adopt SaaS — PLM, design and simulation — tools compared with fewer than 20% today.” ⁴

Even though PLM migration to the cloud has taken longer than most analysts initially predicted, indications are this is a quickly growing area of focus. Understanding where the business value is hiding and having realistic expectations for the cloud and SaaS are important factors justifying any investment.

To hear additional insights on understanding the business value of SaaS PLM, register for the Aras webinar, “Letting Business Value Drive Cloud PLM Transition,” featuring Jim Brown, president of Digital Innovation Research at Tech-Clarity. Learn how to align SaaS PLM with your business objectives and drive maximum value from your cloud solution.

References

Tech-Clarity, “Manufacturers Adopting Cloud Innovation Platforms”, 2019.
CIMdata, “CIMdata 2023 Market Analysis Report Series; Executive PLM Market Report”, July 2023
Tech-Clarity, “Achieving the Business Value of Cloud PLM”, 2023.
Gartner, “How to Plan for a Successful Adoption of SaaS PLM”, DOC G007834732023, January 2023.GARTNER is a registered trademark and service mark of Gartner, Inc. and/or its affiliates in the U.S. and internationally and is used herein with permission. All rights reserved.

Where is Your PLM SaaS Business Case Hiding?

Bruce Bookbinder — Thu, 03 Aug 2023 12:15:00 GMT

This blog is the first of a two-part discussion on how to uncover the value of PLM SaaS. In this post, I’ll discuss focusing on the “right SaaS solution first,” creating the benefits of cloud migration by supporting the organization’s business objectives.

In part two of the blog, I will discuss how the right solution can improve IT capabilities and support future growth and the complexity of a PLM system.

Crafting a business case for your PLM investment is rarely easy, but many people are surprised at how difficult it can be to define the value of migrating a PLM system to software-as-a-service (SaaS). Many start out with the belief that a move to the cloud automatically comes with a solid business case. After all, it’s hard to read an article about the cloud without amazing testimonials of new and improved security levels, state-of-the-art technology, and unlimited scalability provided by giant cloud providers with an enormous benefit of scale to drive costs down. So why has the PLM SaaS proposition been so difficult for organizations to get their arms around?

I believe the conversation starts with understanding what it means to move to the cloud versus what it means to move to SaaS. Most IT professionals have a relatively clear understanding of what it means to move to the cloud. By shifting system infrastructure and the day-to-day management of the infrastructure from internal data centers and staff to a cloud provider, the IT function is moved to an external vendor. After many years, IT organizations clearly understand how to achieve financial benefits from outsourcing work to third-party entities.

Infrastructure-as-a-Service (IaaS) is only part of adopting a SaaS PLM solution

SaaS includes the benefits of moving to the cloud, and the right solution should include a collection of business benefits that enable an organization to implement and support its future PLM vision regardless of its complexity. Moving PLM to a SaaS offering that favors functionality with flexibility is vital to leverage the complexity of digital threads, digital twins, product simulations, and other valuable product development strategies. But to obtain the necessary business value for SaaS adoption, the company’s business transformational objectives, not their cloud adoption strategy, need to drive the lion’s share of the value. As Tech-Clarity’s president Jim Brown discussed in his recent white paper, “Achieving the Business Value of Cloud PLM,” IT will be required to change its “cloud first” directive to a “solution first” approach.

Think business before software

In Tech-Clarity’s white paper, Jim proposes that companies need to “think business before software.” Tech-Clarity’s research on long-term business success and profitability shows that “Customer relationships, digital transformation, long-term profits, product/service innovation, and workforce development are the most common profitability drivers. So why is so much of the emphasis on cost versus benefits when you don't see "short-term profits," let alone "software cost," at the top of this list? The business case for SaaS PLM should focus on enabling broader strategies that drive innovation and profitable revenue growth. That's much more strategic than reducing software spend.”

I really like this statement because it captures the strategic nature of investing in a PLM SaaS solution. The way to achieve a favorable business case is to focus on the value of a flexible PLM solution on the cloud rather than the adoption of a cloud strategy to manage your PLM solution. This approach provides the right PLM functionality to enable an organization’s digital transformation and product innovation efforts. Since these areas are an organization's profitability drivers, the business case value is found here. More importantly, the right PLM SaaS solution ensures that failure is not an option for these critical programs!

To maintain the value of any PLM system, companies need to prioritize functionality with flexibility. SaaS solutions are very effective in keeping solutions up to date with regular updates solving long-term issues with many legacy PLM systems. Flexibility can be another story. Regular upgrades will keep customers up to date with the vendor’s latest functionality, but what about the customer’s unique requirements? Too many PLM SaaS offerings limit or totally prevent customers from creating customizations to meet their specific needs. Only using out-of-the-box (OOTB), functionality will limit the value of the solution and is not realistic - especially considering the baseline of OOTB functionality for some PLM SaaS solutions is less than their flagship on-premises offering. As Tech-Clarity’s research stated:

To manage this deficiency, many PLM SaaS providers propose a solution of “de-customization” to prospective customers which is another way of saying they must use the out-of-the-box functionality, leaving the customer dependent on the vendor’s roadmap.

Aras Enterprise SaaS is different

Aras Enterprise SaaS is the only SaaS offering for PLM that supports unlimited customizations and the capabilities to create unique solutions with no limits to complexity. Each customer’s unique functionality will be upgradable through the normal upgrade process, ensuring the solution will stay up to date with Aras’ roadmap while maintaining the customer’s investment in their PLM system. This is the only way to ensure that the value of a PLM solution will continue to increase as the solution grows in size and complexity. These topics were discussed at length at Aras’ ACE 2023 user conference in May, and IDC commented on it in their Market Note, Aras ACE23 User Conference¹,

“Given Aras' emphasis on customization, the move to SaaS simplifies engaging systems integrators and contractors on an as-needed basis — to improve the time, cost, and quality of engineering and production operations.” They added, “Aras' overarching message is that the ease of implementing commercial off-the-shelf PLM applications has been overstated, and based on IDC's research into the number of consulting projects that are focused on implementation and integration, Aras may be correct.”

To hear additional insights on understanding the business value of SaaS PLM, register for the Aras webinar, “Letting Business Value Drive Cloud PLM Transition” featuring Jim Brown, president of Digital Innovation Research at Tech-Clarity. Learn how to align SaaS PLM with your business objectives and drive maximum value from your cloud solution.

To find out more about Aras Enterprise SaaS, read CIMdata’s commentary “Aras Enterprise SaaS:A Gen 2 Leader."

¹IDC, Aras AC23 User Conference, Doc # US50665023, May 2023

Increasing Developer Productivity 4X: DevOps for Your PLM

Bruce Bookbinder — Tue, 18 Apr 2023 12:15:00 GMT

I was intrigued with a recent report from IDC¹ that predicts that “By 2025, the automation capabilities such as CI/CD and automated testing within low-code and no-code developer tools will mature, leading to a 4x increase in line-of-business developer productivity.” This productivity improvement will certainly be welcome by a universe of developers trying to keep pace with their company’s never ending business transformation objectives. Having the right tools and processes in place to support a DevOps culture will be critical for companies to succeed.

Culture, not technology

The first thing to understand about DevOps is that it refers to a change in culture in which software development (Dev) and IT operations (Ops) merge to improve the software development and delivery process within the organization. The culture provides the fundamental structure to improve the speed and quality of the development process. The objective of a DevOps culture is for the operations and development teams to actively partner across the entire software development lifecycle, from design through to support, using a set of lean and agile practices that automate and integrate the processes between them.

The advantage of this philosophy is that increased communication, integration, and collaboration among the IT players allows for the identification and resolution of an issue as it happens—before the scale of the problem expands into a time-consuming effort to correct it. Critical IT players—the developers, testers, operations, and infrastructure resources work within the same processes and tools to test and deploy code in an automated and integrated manner creating “quick feedback loops” and telemetry to help make decisions faster.

DevOps vs. Agile–Are they the same?

While DevOps and Agile both focus on increasing the speed and quality of software development through intensified collaboration, they each focus on a different component of the process.

An Agile methodology bridges the gap between the customer’s business requirements and their IT development and testing teams.
A DevOps culture joins the IT development and testing teams with the operations team to standardize the tools across these areas and optimize the processes through integration and automation for improved delivery.

Companies utilizing an Agile methodology find that they improve the velocity and quality of their end-to-end software development process by embracing a DevOps culture. DevOps allows IT to work with Agile’s fast-paced sprints and reduces delivery bottlenecks.

Getting the buy-in for change

After a company decides to adopt a DevOps culture, its attention turns to how to implement it through the proper tools and processes within the company. Determining the right software to manage the code base, pipelines, and artifacts, and how to integrate these tools to work seamlessly, requires considerable effort and buy-in from the business.

Implementing the automation and controls for these processes to ensure all the functions work across multiple development, testing, and production environments can be challenging. Without the automation component of the environment, the DevOps process will not be able to keep pace with today’s quick and continuous release cycles.

An interesting use case to consider is automated testing. While automated testing software has been available for some time, its adoption has lagged. The slow adoption results from manual and complex executions, processes, and the upkeep of test scripts, making the overall value proposition weak. With DevOps, these tools are getting a lot of new attention. Automated testing tools are integrated into the DevOps environment and process and configured to automatically execute every time a code base is committed.

The tests are executed often—even daily in many cases—without manual effort from the process owner. By reviewing the resulting exception reports, bugs are caught quickly, before they impact the larger development process.

This typical use case shows how implementing a DevOps culture and providing the right tools can increase productivity without increasing effort.

PLM needs DevOps but few tools are available

While many companies can clearly see the value of adopting a DevOps culture, implementing the approach can be difficult. Since a DevOps environment is comprised of multiple functions and products that require tight integration, automation, and administration, the initial implementation can get complex.

In the PLM domain, few software vendors offer a comprehensive DevOps solution to enhance their development environment. This may be acceptable for companies that use their PLM solution out-of-the-box, but this is not common. PLM customers almost always require customizations to their solutions to meet specific requirements. Since most PLM software is not easily customizable and requires considerable testing to manage change, the addition of DevOps is particularly valuable to facilitate development efforts.

How to start adopting a DevOps culture and implement the necessary tools

Aras DevOps is one notable exception to the lack of DevOps products for PLM. Aras users can easily benefit from a DevOps approach because the Aras low-code platform supports complex customizations while never affecting the customer’s ability to upgrade their environment.

Aras adopted a DevOps culture internally years ago, creating an integrated cloud-based DevOps environment by automating state of the art tools and processes to facilitate the development of every release. Now, the same DevOps solution is available to Aras customers in a turnkey environment via the cloud. The cloud environment allows users to have ubiquitous access and collaborate from anywhere in the world.

DevOps and Aras Innovator

In the PLM DevOps race, Aras gets you to the finish line in one quick dash. Learn more about Aras DevOps.

¹IDC, IDC FutureScape: Worldwide Developer and DevOps 2023 Predictions, Doc # US48597522, October 2022

3 Reasons Modern SaaS Will Prevent Southwest Airlines’ $825 Million Type Disasters

Bruce Bookbinder — Thu, 09 Mar 2023 15:00:00 GMT

I wonder if P.T. Barnum would have agreed that “There is no such thing as bad publicity” if he worked for Southwest Airlines and woke up one morning to the Forbes headline “Southwest Airlines Under Federal Investigation For Possible ‘Deceptive’ Scheduling.” While we live in a world where all publicity may be good for celebrities, the same cannot be said for businesses. There is just no way to spin an unexpected net loss of $825 million for a quarter that was projected to “generate strong profits and margins in fourth quarter” just two months earlier.

Many companies find out the hard way that their carefully developed brand image can be destroyed in days, if not hours when their organization fails their customers en masse. There is no quicker way for a company to accomplish this misfortune than having their systems implode in front of the world. While it is easy to pick on Southwest Airlines today, there are many examples of such breakdowns, often related to security breaches or product safety failures.

What Happened at Southwest?

In the blog, “Failing to Keep Up With Technology Will Undermine Your Digital Transformation Strategy,” Paweł Chądzyński discussed several recent examples of companies painfully mitigating the impact of their systems falling behind. The case of Southwest Airlines was particularly interesting since the meltdown was “100% due to a purposeful delaying of technology upgrades.” In other words, totally preventable. The article "The Shameful Open Secret Behind Southwest's Failure," details the appalling situation where over 17,000 flights were canceled over a busy holiday week last year. According to the article, the scheduling systems desperately needed to be modernized due to the significant amount of technical debt in the code.

What is technical debt?

Typically, technical debt is the result of coding shortcuts that are created within software during system modifications. The technical debt remains in the code base until it can be reviewed and improved later. This does not necessarily mean technical debt are bugs in the code, but rather strategic limitations that make the system less resilient for future changes (although bugs can easily be introduced as a result of technical debt). While technical debt may not cause an issue today, there is a high likelihood of system issues in the future if they are not addressed.

Creating technical debt typically occurs when tight deadlines limit the time to implement system changes. Unfortunately, new priorities often interfere with the best intentions. Delaying the correction of the technical debt creates a ticking time bomb for the organization. In many cases, normal software upgrades become too difficult to implement, leaving antiquated versions of software in place for years. The fact that there had been smaller scale meltdowns at Southwest was indicative of a larger issue brewing. According to the article, the situation had escalated to the point the president of the Southwest flight attendants’ union said there were system breakdowns even during mild hiccups.

Enter Software-as-a-Service (SaaS)

There is a major transformation happening in the software industry. Almost every system, crossing all types of applications, is being built or retrofitted to leverage cloud infrastructure. With widespread cloud adoption, software vendors are also altering their approach to commercializing their products by offering them as software-as-a-service, or SaaS. By providing the same software solution to multiple customers and using shared technical and human resources to manage it, the economy of scale brings a lucrative business case to the solution provider.

A cornerstone of SaaS offerings is that the functionality works the same across all customer deployments. Without allowing the capability for each customer to customize the solution for their specific business requirements, support of the product can be streamlined across their customer base. Most SaaS offerings provide some minor configurability to users, but significant functionality remains constant.

This limitation does not create an issue for many types of SaaS offerings. For instance, most people would not consider customizing the code for Microsoft 365 or for their Netflix subscription (yes, Netflix can be considered a SaaS company providing on-demand videos). For more comprehensive enterprise solutions like Product Lifecycle Management (PLM), which provides digital thread capabilities across multiple systems to tens of thousands of users globally, working out-of-the-box (OOTB) with a standard solution is unrealistic. Companies have very different requirements to support their unique business processes and combination of systems. It takes more than simple configurations to deliver to this level of complexity.

How can a modern, customized Software-as-a-Service (SaaS) solution help?

For enterprise solutions like PLM that require customizations to provide business value to their customers, vendors must support several capabilities not typically available in current PLM SaaS offerings. The solution must be able to implement customizations strategically, upgrade without impact from the customizations, and execute this within a DevOps culture for efficient delivery of system changes.

Strategic customizations – The word strategic is vital. Many SaaS solutions claim to offer the ability to customize their applications, but the devil is in the details – what they really mean is configuration. While configurations are beneficial, they cannot replace executing customizations to solve a company’s most complex issues. A SaaS offering needs low-code capabilities to model a company’s unique business processes directly into the platform. Otherwise, IT departments will be forced to create workarounds and extra integrations to other tools leading to – you guessed it – technical debt.
Upgrades without issues – Upgradability is a massive benefit of SaaS offerings, ensuring the systems will remain current. Upgrading SaaS solutions is just like upgrading your smartphone; you go to bed at night and wake up in the morning to an upgraded phone with new capabilities. Historically, PLM systems have been notoriously difficult to upgrade due to high levels of customizations and technical debt. If a SaaS offering cannot support customizations without affecting the ability to execute regular upgrades, you just lost a significant benefit of a SaaS. Of course, this leads to the earlier statement on Southwest’s meltdown being “100% due to a purposeful delaying of technology upgrades.”
A DevOps culture – The nature of SaaS and working in the cloud is to foster collaboration across many diverse and globally located user groups. To support the creation of customized functionality in the cloud, the fundamentals of building, testing, and implementing system changes should not work differently than multiple business users collaborating on a business application in the cloud. A DevOps culture streamlines and automates the continuous integration (CI) and continuous delivery (CD) processes across different functions and locations to ensure the delivery of system changes without impact to the user community.

When combining the ability to strategically customize applications, upgrade the system without impacts from customizations, and streamline the continuous integration and continuous delivery process with a DevOps culture, a modern SaaS offering on the cloud delivers a solution with the power of an on-premise solution. These components will eliminate the creation of technical debt in the code base and ensure system upgrades will be executed on schedule and the system will be modernized with every upgrade. These capabilities are some of the features necessary to be considered a “Generation 2 SaaS PLM” solution as CIMdata describes in their recent commentary.

Conclusion –- What’s your brand worth?

Maintaining and enhancing global, enterprise systems is expensive, but it is possible to mitigate the costs. If the platform is designed to evolve as the company changes, it will not only reduce the operational costs of building and implementing modifications, it will also eliminate the creation of technical debt as described in “Southwest’s Meltdown Will Cost Up To $825 Million.”

What happened at Southwest should be a warning to companies that ignore the impact of creating technical debt. These shortcuts tend to snowball until a system cannot be upgraded to keep up with new functionality from the vendor. As companies are making major system changes to adopt cloud technology and new SaaS offerings, now is the time to consider how they will support their unique requirements and stop assuming an “out-of-the-box” approach will work for them. Otherwise, their employees may wake up one morning to “Southwest Stock Plunges: Flight Cancellations Top 10,000 As Feds 'Examine' Airline’s Historic Winter Storm Woes.”

3 Predictions Impacting the 2023 Enterprise PLM Cloud Market

Bruce Bookbinder — Tue, 03 Jan 2023 15:03:00 GMT

For those who analyze the PLM sector, the yearly exercise of predicting when large companies will adopt PLM on the cloud en masse has become repetitive. For years, we have seen CRM and ERP systems adopt cloud strategies enabling companies to sustain a complicated and ever-changing security posture better while providing an alternative to the rising costs of recruiting technical resources and investing in new infrastructure. Every year seemed like “the year” that large PLM systems would join the CRMs and ERPs to begin their long-anticipated march together into the cloud. While cloud PLM systems targeted to smaller companies have been successful for quite some time, medium to larger companies requiring robust PLM capabilities have been hesitant to move off their on-premises solutions.

Prediction 1 – Cloud PLM deployments will become the first option for large companies

I predict the inertia from the growing number of cloud-first strategies and the increasing challenges of managing a company’s cybersecurity in today’s global environment will create a tipping point, and 2023 will be a breakout year for enterprise PLM deployments on the cloud.

With several years of relentless global disruptions from the pandemic to massive supply chain issues, from military conflicts to rising energy costs, companies have been forced to react quickly by adopting new business and technical strategies to ensure organizational stability. Significant shifts to company operations have been necessary to account for the labor force working from home, growing partner networks requiring system access from remote locations, and, of course, ever-increasing security threats. The impacts of these new demands have aligned precisely with the strengths of the cloud. Many organizations have adopted a cloud-first strategy for their system deployments, including PLM. We have certainly seen hints of this over the past two years, as reported by industry analysts:

According to CIMdata in their 2022 Executive PLM Market Report, “Cloud-based PLM adoption has been slow, but interest is picking up. In most of CIMdata’s industrial consulting engagements today, the question is 'why not cloud?' with a lot of push coming from corporate IT and even the C-suite.”

According to Tech-Clarity in their eBook, “The State of Cloud PLM 2022,” “three-quarters of companies favor, prefer, or mandate the cloud for their new software selections.”

Prediction 2 – When the cloud is not enough – enter SaaS

I predict as companies find that managing complex PLM deployments on the cloud require more than just cloud technology, but also the skills to manage it effectively, the importance of PLM SaaS offerings will accelerate quickly in 2023.

As companies move their deployments to the cloud for improved security, unlimited capacity or to reduce and simplify their system administration (Fig. 1), many find there is a major component overlooked – the expertise to optimally deploy, run, and manage their PLM implementation on the cloud. Enterprise PLM systems can be very complicated to administer.

Fig. 1, From CIMdata’s eBook “Leveraging the Cloud for Global Market Success”

Moving a system to the cloud using Infrastructure as a Service (IaaS) provides IT departments with many of the pieces to eliminate the dependency on an internal data center and the resources required to manage the infrastructure. But to realize the full value of the cloud, they also require PLM solution-specific technical resources that only a robust Software as a Service (SaaS) subscription can provide. Again, enterprise PLM systems can be very complicated to administer.

Huge volumes of highly confidential data are delivered to resources in remote locations everywhere and anywhere across the globe. Since enterprise PLM systems are often the core of a company’s digital thread, connecting data from multiple systems potentially located in different locations, the ability to ensure users have acceptable response times while the data between systems is always available requires a high level of solution-specific technical expertise. These resources are expensive and in-demand leaving companies struggling to recruit and maintain a workforce that can manage the high demands of today’s PLM environment. The right SaaS offering will include the expertise to not only deliver to their aggressive service level agreements (SLAs) but it will also be able to make the necessary pivots as requirements change, ensuring a seamless experience for its customers.

Prediction 3 – PLM Cloud Platforms become a battleground

In 2023, I predict that PLM providers’ strategic cloud platforms (not just each application’s business functionality) will become customers’ focal points when selecting their future PLM solutions as they migrate to the cloud. PLM platforms with loosely connected applications or that lack the capability to support customizations for organizations’ specific requirements will struggle to maintain their customer base as companies migrate to the cloud.

For years companies have heavily marketed their PLM solution as part of a platform. What it means to be a platform can suggest very different things to different organizations and is often the source of confusion for customers when comparing solutions. Jim McKinney’s blog “Do You Suffer from PLM Legacy Syndrome?” does an excellent job discussing the value of an integrated platform of connected solutions that support the digital thread. He also describes the potential negative impact of a platform that is nothing more than “a bunch of disconnected solutions neatly wrapped in a fuzzy blanket of marketing jargon.”

By 2022, most Enterprise PLM providers have introduced a cloud platform strategy. These strategies have often been assembled by acquiring multiple independent, existing cloud products, and using them as the basis of a platform to provide capabilities or functionality. While the success of these strategies will be critical in the fight for market share, most enterprise PLM providers have struggled to tie their platform solution together effectively for the cloud. This often leaves multiple data models or complex integrations in place for the platform to operate. This is evidenced by several providers quietly changing their platform strategies over the past few years.

To compete for the largest and most visible customers, enterprise PLM solutions will need to show their PLM platforms can support growth and flexibility into new and complex areas, while also meeting the specific requirements of large customers. Cloud solutions generally come with a perception that organization specific customizations are limited or even restricted. Since most large PLM cloud platforms have positioned their solution as out-of-the-box first with minimal ability to customize, I believe this is where the battle will begin. Historically, out-of-the-box solutions have never been a successful strategy in the enterprise PLM space, and I do not believe this will change in the future.

Summary

The adoption of cloud solutions for enterprise PLM systems has been slow. It seems understandable that companies were unwilling to move their most valuable intellectual property (IP) out of their own data centers and trust third party providers to deliver acceptable user response times for a system moving huge amounts of data around the world. Now, after many years of success managing deployments of all types of large applications around the world, the enterprise PLM cloud market is ready to grow quickly. The only question left is which of the enterprise PLM solutions is best prepared to handle the challenge?

For more information on Aras Enterprise SaaS, read CIMdata’s analyst commentary “Aras Enterprise SaaS: A Gen2 Leader.”

3 Predictions Impacting the 2023 Enterprise PLM Cloud Market

Bruce Bookbinder — Tue, 03 Jan 2023 15:03:00 GMT

Prediction 1 – Cloud PLM deployments will become the first option for large companies

According to Tech-Clarity in their eBook, “The State of Cloud PLM 2022,” “three-quarters of companies favor, prefer, or mandate the cloud for their new software selections.”

Prediction 2 – When the cloud is not enough – enter SaaS

Fig. 1, From CIMdata’s eBook “Leveraging the Cloud for Global Market Success”

Prediction 3 – PLM Cloud Platforms become a battleground

Summary

For more information on Aras Enterprise SaaS, read CIMdata’s analyst commentary “Aras Enterprise SaaS: A Gen2 Leader.”

3 Predictions Impacting the 2023 Enterprise PLM Cloud Market

Bruce Bookbinder — Tue, 03 Jan 2023 15:03:00 GMT

Prediction 1 – Cloud PLM deployments will become the first option for large companies

According to Tech-Clarity in their eBook, “The State of Cloud PLM 2022,” “three-quarters of companies favor, prefer, or mandate the cloud for their new software selections.”

Prediction 2 – When the cloud is not enough – enter SaaS

Fig. 1, From CIMdata’s eBook “Leveraging the Cloud for Global Market Success”

Prediction 3 – PLM Cloud Platforms become a battleground

Summary

For more information on Aras Enterprise SaaS, read CIMdata’s analyst commentary “Aras Enterprise SaaS: A Gen2 Leader.”

3 Predictions Impacting the 2023 Enterprise PLM Cloud Market

Bruce Bookbinder — Tue, 03 Jan 2023 15:03:00 GMT

Prediction 1 – Cloud PLM deployments will become the first option for large companies

According to Tech-Clarity in their eBook, “The State of Cloud PLM 2022,” “three-quarters of companies favor, prefer, or mandate the cloud for their new software selections.”

Prediction 2 – When the cloud is not enough – enter SaaS

Fig. 1, From CIMdata’s eBook “Leveraging the Cloud for Global Market Success”

Prediction 3 – PLM Cloud Platforms become a battleground

Summary

For more information on Aras Enterprise SaaS, read CIMdata’s analyst commentary “Aras Enterprise SaaS: A Gen2 Leader.”

De-risking Your PLM Should be Your Number One Priority

Bruce Bookbinder — Tue, 08 Nov 2022 13:04:00 GMT

A note from the author:

What does de-risk mean?

Why are we talking about de-risking PLM now?

Three ways companies de-risk their PLM environment

Let’s look at three examples of how companies are de-risking their PLM:

(Read more in the insightful CIMdata report, Deferred PLM Modernization Delays Time to Value.)

90% of respondents from a recent Tech-Clarity survey responded that the importance of PLM customizations is “critical” or “very important.”

Final thoughts

62% of respondents from the same Tech-Clarity survey replied they are “currently using” or “planning to use” a cloud PLM.

How Important is Customizing your Cloud PLM? Survey says…

Bruce Bookbinder — Thu, 07 Jul 2022 13:00:00 GMT

On June 30, Aras hosted Jim Brown, president of Tech-Clarity, for the webinar, “How Fast is PLM Moving to the Cloud?” During the session, Jim discussed findings from Tech-Clarity’s recent survey on the state of PLM and the changing attitudes of companies moving their PLM solutions to the cloud. While the survey and webinar covered a multitude of themes, I found the most exciting topic to be the views of PLM leaders regarding the need for solution customizations even as they move to the cloud.

Right from the start, the survey results and analysis clearly indicated manufacturers now favor the cloud with three-quarters of companies favoring, preferring, or mandating the cloud for their new software selection. While this is no surprise, companies also suggested they are unwilling to reduce the scope of functionality available from their highly customized applications today. Again, this is to be expected considering the significant investment companies have made customizing their existing PLM solutions over time. But since the intent of many cloud/SaaS solutions is to limit or even restrict company-specific customizations, how will customers manage their unique requirements in future cloud solutions? Will companies be able to use their out-of-the-box PLM solutions?

Considering the survey feedback shows less than 20% of companies are working out-of-the-box today, the answer is likely to be no. (I’m being generous, the answer is definitely, no.) In addition, respondents sent a clear message that existing PLM customizations are “very important” or even “critical” to achieving business value and user adoption of the system.

When trying to reconcile these individual points, you will see an obvious contradiction. How will companies move to the cloud and leverage the proven benefits of a cloud deployment while also maintaining their existing, customized functionality? Will they be empowered to continue enhancing their PLM environment in the future? According to the survey, 87% of PLM leaders felt that customizations were “definitely” or “most likely” necessary if they were to continue their PLM journey to the cloud. This indicates the PLM cloud solution itself must embrace capabilities to customize the solution while not impeding the ability to easily implement future software upgrades by the software provider.

After reviewing the results of Tech-Clarity’s survey, Jim and I spoke about Aras Enterprise SaaS and the ways this solution aligns with the survey feedback and what we hear from our customers. We discussed how the Aras SaaS offering provides customers with the same capabilities and applications in the cloud that it provides as part of an on-premise deployment. Aras Enterprise SaaS supports unlimited customizations and offers the capability to create unique solutions with no limit to complexity in the cloud. Extending the conversation about customizations, we also discussed the fact that our Enterprise SaaS solution includes Aras DevOps, the deployment framework preconfigured to work with the Aras platform. The solution automates and optimizes system change processes to power a DevOps culture. Differentiated from any other PLM SaaS offering, Aras Enterprise SaaS is built for resilience, encouraging customizations by providing the tools and processes to ensure the speed and quality of future deployments.

As a final topic, we discussed the ability of our SaaS offering to eliminate compliance issues, risks, and the associated liabilities of systematic updates by delivering upgrades on our customers’ schedules.

You can read more about Tech-Clarity’s survey results in their eBook, "The State of Cloud PLM 2022." In addition, a replay of the “How Fast is PLM Moving to the Cloud?” webinar can be found here.

Five Hot Topics and Takeaways:

Part of the reason for the initial delay (in cloud adoption) was a lack of capabilities in earlier versions of cloud PLM.
Today companies need business agility, but older PLM implementations hamper the progress they can make and the value they can get from their PLM solution. This situation is creating an accelerated uptick in cloud PLM adoption.
Not a question of “if” companies will move their PLM to the cloud, but more of a question of “when” and “how”.
Companies need to focus on a PLM solution that has the rich capabilities that supports their business needs. It doesn’t make sense to get the cloud benefits unless the solution can meet the requirements of the business.
1. “It doesn’t matter if the investment ROI goes down if the return goes down even more.” – Jim Brown
Companies need to consider the solutions ability to customize and control the timing of upgrades. The cloud architecture is critical to support the value of the solution.

Bruce Bookbinder さんの グループ アクティビティ

The Upside of AI – A Use Case for the PLM World

From Rob McAveney’s (Aras CTO) ACE 2024 keynote presentation “On the Thread to What’s Next”

The Unstoppable Momentum of PLM SaaS

De-risking Your PLM Should be Your Number One Priority

PLM Customizations and De-customizations: How SaaS is Changing the Future of PLM

From “The State of Cloud PLM 2022,” Tech-Clarity

Where is Your PLM SaaS Business Case Hiding? Webinar Recap

Where is Your PLM SaaS Business Case Hiding? Part 2

Where is Your PLM SaaS Business Case Hiding?

Increasing Developer Productivity 4X: DevOps for Your PLM

1IDC, IDC FutureScape: Worldwide Developer and DevOps 2023 Predictions, Doc # US48597522, October 2022

3 Reasons Modern SaaS Will Prevent Southwest Airlines’ $825 Million Type Disasters

3 Predictions Impacting the 2023 Enterprise PLM Cloud Market

3 Predictions Impacting the 2023 Enterprise PLM Cloud Market

3 Predictions Impacting the 2023 Enterprise PLM Cloud Market

3 Predictions Impacting the 2023 Enterprise PLM Cloud Market

De-risking Your PLM Should be Your Number One Priority

How Important is Customizing your Cloud PLM? Survey says…

Bruce Bookbinder さんのグループアクティビティ

¹IDC, IDC FutureScape: Worldwide Developer and DevOps 2023 Predictions, Doc # US48597522, October 2022