Amr 20938

Product Innovation and PLM
2007 Technology and Vendor Landscape Series
PLM Market Landscape: Evolving To

Enable Value Chain Excellence
by Jeffrey Hojlo, Michael Burkett, and Koppel Verma
Although many businesses utilize product lifecycle management only for design
or product data management, it’s one of the three foundational legs that support
a demand-driven supply network. PLM vendors realize this opportunity and are
improving their products to support value chain excellence.
Market Services Report

Acronyms and Initialisms
A&D Aerospace and defense IP Intellectual property
AEC Architecture, engineering, and construction IPPD Integrated product and process design
APQP Advanced product quality planning LDAP Lightweight directory access protocol
BI Business intelligence MES Manufacturing execution system
BOM Bill of materials NPDL New product development and launch
CAD Computer-aided design PDM Product data management
CAM Computer-aided manufacturing PLM Product lifecycle management
CAPA Corrective and preventive action PPM Product portfolio management
CNM Customer needs management QA Quality assurance
CP Consumer products QC Quality control
CPD Collaborative product design R&D Research and development
CRM Customer relationship management REACH Registration Evaluation and Authorization
of Chemicals
DDSN Demand-driven supply network
RFX Request for proposal, quote, etc.
DFM Decision flow management
RoHS Reduction of Hazardous Substances
DMS Direct materials sourcing
SaaS Software as a service
EMEA Europe, Middle East, and Africa
SCADA Supervisory control and data acquisition
ERP Enterprise resource planning
SCM Supply chain management
EuP EcoDesign of Energy Using Products
SKU Stock-keeping unit
FDA Food and Drug Administration
SMB Small and midsize business
FMEA Failure modes and effects analysis
SOA Service-oriented architecture
GPD Global product development
UI User interface
HCM Human capital management
WEEE Waste Electrical and Electronic Equipment
HR Human resources
WIP Work in process
© Copyright 2007 by AMR Research, Inc.
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PLM Market Landscape: Evolving To
Enable Value Chain Excellence
by Jeffrey Hojlo, Michael Burkett, and Koppel Verma
Product lifecycle management (PLM) vendors, seeing opportunity in enabling The

the demand-driven supply network (DDSN) and extended value chain, are Bottom
improving their applications to support value chain excellence. Line
When one looks at the mantras of three of the largest PLM provid-
Executive Vendors featured
ers, it becomes apparent that product lifecycle management is rap-
Summary idly coming of age: SAP’s efforts to connect the product and service
in this Report:
Aras
lifecycles, Dassault’s democratization of 3D, and Siemens PLM
Arena Solutions
Software’s focus on global innovation networks. PLM no longer simply equals CAD
Autodesk
data management and engineering workgroup collaboration.
Dassault Systemes
Enginuity
And it’s not just because PLM vendors say so. Our research reveals end users are
Infor
increasingly looking at PLM as a standard enterprise platform. They’re asking how
Oracle
PLM systems can be used to manage their product portfolios, capture customer needs,
PTC
and integrate nonengineering staff into the product design process, a domain histori-
SAP
cally dominated by engineers. Moreover, end users and PLM vendors alike are finally
Selerant
thinking about linking the product design process upstream with the product launch
Siemens PLM
process to effectively predict demand and product performance. They’re also thinking
Software
about linking it downstream into supply and manufacturing to simulate supply and
manufacturing capacity.
This decision support capability is critical if PLM is going to be a mainstream, enter-

prise application or, as AMR Research has always defined it, an enterprise business
strategy for bringing new products to market. Although most PLM vendors have some
portfolio management and decision support capability either organically or through
partnerships, our research has found that the ability to predict and model decisions
through the course of the new product development and launch (NPDL) process and
across the value chain is still immature.
Despite this immaturity, we expect the PLM market to grow at a 9% five-year CAGR.
The 9% allocation of budget to PLM in our 2006 IT spending numbers revealed this
will increase over time, particularly as PLM vendors build out their capabilities in per-
formance management, sourcing and procurement, and knowledge management, while
tightening their integration with manufacturing operations, CRM, ERP, supply chain
management (SCM), and human capital management (HCM).
Product Innovation and PLM Report | 2007 Technology and Vendor Landscape Series © 2007 AMR Research, Inc. 1
Recommendations for users
• When deciding which PLM vendor to partner with, consider the product develop-
ment challenge you are trying to solve: is it simply managing CAD data and commu-
nication between engineers, the effective launching of products, or both?
• Use PLM as a standard application in your enterprise, just like ERP, CRM, and SCM.
• Evaluate vendors on the scalability of their network infrastructure. Robust network
performance is necessary for global product development (GPD), particularly when
you are sharing rich 3D CAD models globally.
• Consider applying 3D to support other NPDL processes, particularly customer needs
management (CNM), service, and support.
• Demand decision support functionality.
Recommendations for vendors

• Expand your definition of PLM from CAD data management to an NPDL and
value chain enabler.
• Remember: decision support, decision support, decision support!
• Weave ideation and voice of the customer into your products.
• Enable effective collaboration between value chain constituents in and outside the
company.
• Provide a software-as-a-service (SaaS) offering.
• Link into market research databases and CRM systems to help analyze new product
opportunity.
• Expand your services practices.
• Extend 3D to new audiences and markets.
2 © 2007 AMR Research, Inc. Product Innovation and PLM Report | 2007 Technology and Vendor Landscape Series
The product lifecycle management market
The PLM market is growing, with tremendous amounts of untapped opportunities in
North America and EMEA, as well as in growing markets like Latin America and Asia-
Pacific. The primary driver of this growth is that manufacturers are making managing
and introducing products top priorities. Nevertheless, there has been low investment
in PLM versus ERP or other application categories. Our IT spending studies find that
manufacturers list rapid introduction of new products and streamlining supplier man-
agement processes as the most important factors in remaining competitive. On the
other hand, they remain immature in understanding how to use technology to improve
these processes.
Now times are changing. The market is maturing rapidly to support the design-to-manu-
facturing planning and handoff process that has been around for years: integrated product
and process design (IPPD). The remaining area of opportunity for PLM applications is
at the business layer, with end users looking to utilize PLM for far more than managing
CAD data and concurrent engineering processes. Effectively understanding market and
customer needs, turning those needs into products, and then launching them to the mar-
ket requires more than managing and communicating CAD models. It demands close
collaboration with the global value chain to use ideas, capacity, and expertise.
Figure 1: PLM—a critical component of the global value chain
Process-Driven PLM Framework
Define Design
Quality
Captive Development Improvement Captive Development
Centers and Outsourcing Centers and Offshoring
Service Compliance Supply
Customer Facing
Supplier Facing
Promote Manufacture
Product Portfolio
Management
Customer Needs
SCM
CRM
Demand Management Supply
ERP
Insights Network HCM
Direct Materials
Sourcing
Collaborative
Product Design
Prod ement
IP Manuct Data Manag ecurity
agement and S
Value-Driven Open Innovation
Source: AMR Research, 2007
We are slowly seeing this evolution. Siemens PLM (formerly UGS) has added expanded
portfolio management capabilities through its partnership with Planview, and Oracle
plans to enhance its business intelligence (BI) and portfolio management capabilities
with Agile’s already strong analytics (through partnership with Symphony Metreo)
and portfolio management capabilities. Although it remains to be seen how this will
be used in the PLM space, SAP is in the process of acquiring Business Objects and is
focused on enhancing its CNM and portfolio management capabilities in 2008.
End users are beginning to look to PLM for decision support, NPDL modeling capabili-
ties, sourcing (through tight integration with point applications, at least), and as a plat-
form that enables both internal and external innovation. In other words, they are focused
on Stage 4 of AMR Research’s value chain transformation maturity model to achieve the
perfect product launch (see Figure 3). Most companies we talk to, however, are actually at
Stage 1 or Stage 2, so there is still a great opportunity for end users to improve.
Figure 2: Stages of maturity for new product launch
Growth and Profitability

Cost To Deliver Cost To Serve
Demand Driven Value Driven

External supply partners Joint value creation by
become integral to product orchestrating the innovation
Externally innovation and launch process across and extended
Focused and demand analytics value chain and architecting
evaluate opportunity products and services that
tradeoffs combine partner expertise
3 4
2 1
Customer and
Brand Driven Efficiency Markets Focused
Internally Internal integrated product Product development
Focused teams share a common set operates in a silo and
of product information and pushes innovation out in
standardized new product search of a market to serve
introduction and launch
practices
Cost Focused Revenue Focused
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The business-user definition of PLM
PLM is the umbrella term for a group of software applications used by engineering, purchasing, marketing,
manufacturing, R&D, and service that work on new product development and launch. Done well, NPDL takes into
account not only design and engineering, but supply and demand as well as timing of a product launch, service
of product once sold, and retirement of a product at the end of its lifecycle. The PLM category is defined to help
manage all these elements. The unifying logical element at the base of PLM is product, just as the unifying logical
element at the base of CRM is customer. For this reason, PDM is sometimes confused with PLM. A fairer corollary
for PDM is the customer master file that a CRM system depends on. Figure 4 is a simplified map of the individual
applications that PLM comprises and shows how they touch other major enterprise systems. Figure 5 is a basic PLM
process flow diagram. It’s important to note that PLM is a significant enabler of the value chain, integrating with other
enterprise systems. For more understanding of PLM’s place in the global value chain, see Figure 1.
Figure 4: Product lifecycle management footprint
Product Portfolio Management

NPDL Intelligence
Program Management
ERP
Project Management
Reporting
Direct Materials Sourcing Customer Needs Management

Strategic Sourcing Requirements Management
Component and Supplier Management Preference Analytics
RFX Management ETO/BTO/DTO
Change Management Collaborative Product Design CRM
ERP Product Design Tools
SCM Process Engineering
Visualization
CAD-to-CAD integration ERP
Product Structure (BOM) Product Data Publishing SCM
Document Management Service Parts Planning CRM
Engineering Change Product Data Management Configuration Manage-
Management ment
= Data flows
Figure 5: PLM business process map
Market
Assessment
Conceptual
Design
Engineering
and Detailed
Design
Change
Management/
Release to
Manufacturing
Sourcing and
Supplier
Collaboration
Production
Process
Planning
Market
Rollout/
Launch
Aftermarket
Support and
Service
Product
Portfolio
Management
The move to global value chains is shifting the way
companies look at PLM, with collaborative product
design redefined
As manufacturers expand globally, they need to manage a distributed design team and
a broader cross-functional team, not just design and development. With this global
expansion, issues such as intellectual property (IP) management, enterprise secu-
rity, HCM, and regulatory compliance need to be managed proactively. These risk
factors have always held importance, but GPD brings them closer to the forefront.
Manufacturers are outsourcing and offshoring product engineering, with 30% out-
sourcing some aspect of it and 27% having captive development centers, according to
our research.
Some regions of the world, such as Europe and Asia-Pacific, also are instituting a design-
for-environment approach to product development with the regulations RoHS, WEEE,
REACH, and the EcoDesign of Energy Using Products (EuP) directives. These demand
manufacturers tightly link all the players in their value chains, from engineers, to prod-
uct management, to marketing and sales, to supply, to outsourced engineering services.
The move to global value chains, however, has not yet spawned a PLM SaaS revolution,
even though a web-based product development platform that enables easy project and
PDM for global teams would help speed communication during the NPDL process and
time to market.
As the footprint evolves, the business model stays the same
The primary approaches to PLM deployment are either licensed or on-demand SaaS.
This is primarily because of the classic concerns of security and the continued need to
manage CAD data locally in a GPD world. That said, Arena Solutions, the lone pure-
play PLM SaaS vendor, has gained traction in the small and midsize business (SMB)
space, but large vendors are still hesitant to put their crown jewels online.
As vendors offshore engineering work because of the low costs and lack of qualified
engineers in the United States, as well as work with local suppliers to facilitate design
for supply or late-stage product completion strategies, they increase their risks of work-
ing with people and companies that will try to access more data than they should.
Clearly, there is significant need for a strong security policy, authorization platform, and
authentication schema, and vendors such as EMC, with its RSA product, and CA, with
its Netegrity product, provide this. However, the vendors in this Report can, at least,
enable basic integration with established security policy and password schema, integra-
tion with lightweight directory access protocol (LDAP), and authorization so only the
right people see the right information.
Human capital management needs to be part of the PLM equation
HCM, long relegated to the ranks of the human resources (HR) office, is becoming
a more strategic aspect of the organization. GPD is one reason why, driving the need
to find engineering and design talent from within the company, as well as from out-
sourced resources like consulting and engineering services firms, to support onshore
and offshore development. Having human capital information when determining how
to staff a project provides tremendous competitive advantage. Oracle and SAP, since
they offer HCM applications already, will have a leg up in this area. The challenge for
them will be to provide an integrated, packaged PLM application that includes HCM.
Their respective platforms help as well: SAP, with its Enterprise Services Architecture
(ESA), and Oracle Fusion, which provides the ability to link disparate applications, data
sets, and global teams.
Second Life and 3D: a potential new platform for PLM
Do you have an avatar yet? If not, you may already be behind. GPD teams need to
collaborate, but they can’t always hop on a plane for a face-to-face meeting. Also, devel-
opment teams need to simulate processes without building a physical incarnation of a
product design. As NASA’s Jet Propulsion Laboratories (JPL) suggests, if 3D solid mod-
els could be communicated in Second Life, a virtual reality environment, and modified
in real time across cross-functional global teams that are sitting next to each other at a
virtual table, innovation nirvana will have been reached.
Dassault’s upstream focus on 3D, with its 3Dvia line of applications, and recent acqui-
sition of small product documentation and collaboration company Seemage, as well
as Siemens JT and 3D XML, are examples of platforms and formats that expand the
practical uses of 3D by bringing lightweight 3D models to new vertical markets. The
next step is to develop products in a virtual environment that are enabled by a PLM
backbone and a user interface (UI) similar to that of a video game to generate realistic
product development experiences.
The video game analogy may seem like overkill for the simple sharing of ideas, but it
makes sense when trying to simulate manufacturing process or production, since it
needs to be as lifelike as possible to reduce errors. This would be very applicable for
retail store planning, as well as A&D and automotive for simulating the flying and
driving experiences. This approach to developing products also attracts younger tal-
ent—the digital natives of the world—who are used to working this way. Ansys, MSC
Software, PTC, and Siemens PLM provide strong simulation capabilities.
Integration of applications and data are critical
Service-oriented architecture (SOA) has long held promise as an integrating platform,

but it has struggled to find business processes that would truly benefit. Product innova-
tion, however, is certainly one of them.
This is highlighted by the JPL case study. Working with hundreds of engineers across
the globe under extreme pressure to come up with how to land a rover on Mars or
how to fly a spacecraft through the volatile atmosphere of Jupiter, an SOA provides the
integration and business process configuration platform necessary to collaborate across
multiple CAD systems and data models.
Results from a recent SOA study we published corroborate this. We asked about the
expected benefits of an SOA, and the top answer was faster and more flexible con-
figuration of business processes. Decrease of IT operational costs also topped the list.
This is not a surprise when considering all the large manufacturers that have amassed
numerous IT systems, reams of data, and a spaghetti bowl of processes, most of which
are probably redundant. An SOA can help alleviate these complexities.
The third most popular response in our SOA study was interesting: achieving secure
and reliable service levels. This surfaces the topic of expanding the PLM footprint from
simply developing and launching a product to service delivery and ensuring customers
can easily access the information and applications needed. Dassault Systemes, Oracle,
SAP, and Siemens PLM offer their products on SOAs, realizing their customers need to
easily integrate data and applications across different business processes.
Decision support and product analytics remain

immature in most vendor PLM footprints
PLM vendors focused for years on the low-hanging fruit in the market: getting CAD
work-in-process (WIP) data management and engineering workgroup collaboration
processes under control. This opportunity still exists, with a predicted 8% five-year
CAGR for CAD, computer-aided manufacturing (CAM) and PDM. But it’s slowing as
business users realize the need for tools to help manage the NPDL process, connecting
design with manufacturing and the broader supply chain.
As a result, PLM vendors have expanded to the shop floor, acquiring and building man-
ufacturing planning and modeling capabilities. They are slowly building out offerings at
the business level, mostly through partnerships and acquisitions, with product portfolio
management (PPM), direct materials sourcing (DMS), and CNM. End users are focus-
ing more attention on managing portfolios of products and the decisions needed to suc-
cessfully launch them.
The primary areas of opportunity that define the future of PLM for users and vendors
fall under the umbrella of decision support:
• Connecting disparate data sources —Each group sees product information through
the lens of its own role: CAD geometry, formula development, manufacturing pro-
cesses, spare parts data, or pricing and packaging. It’s critical to enable role-based
views inside and outside the company for faster decision support.
• Single user interface —Most companies don’t have a single product knowledge inter-
face that contains the relevant information for engineering, development, manufac-
turing, service, marketing, sales, partners, and customers. Creating a single UI with
personalized product portals for each constituency would alleviate this challenge.
• Customer needs management—This segment has always been in the AMR
Research PLM footprint, but its growth didn’t take off until the last two years. As
companies reach new levels of PLM maturity with PDM and process management,
they begin to think about linking customer data with the front end of design.
• Product, process, and people performance and analytics —PPM vendors provide
a view of a company’s products, but most applications don’t have deep analytics capa-
bility to look holistically at the performance of product, process, and people from an
opportunity, sales, quality, and execution standpoint.
• Integrated product and process design—Manufacturers need to be able to design,
simulate, and execute the product, process, and production definitions to verify they
have the capability and capacity to make the products they want to produce.
Remember the product manager
Sitting at the apex of data in the enterprise—engineering and product development on

one side, marketing and sales on the other—the product manager (or brand manager, if
you’re targeting consumer goods companies) is often the owner of the decision support
process. Yet we’ve found from our research that this person is largely disconnected from
the product development process.
Figure 6: Product manager at the apex of data
Product
Management
Product
Option
Quality
Customer
satisfaction
Parts Packages
Costs Pricing
Geometry Channels
PLM CRM,
Configurator
Engineers Looking from other directions are Sales

finance and manufacturing with ERP.
Not convinced the product manager is a key stakeholder? Consider the perceived tech-
nology gaps in the NPDL process: they are all front end in nature according to our
research—ideation, testing, prototyping, and marketing. All these processes are driven
by the product manager. As PLM vendors grow their product footprints into applica-
tion areas like PPM and CNM, product managers need to be targeted (see “Voice of
the Product Manager, PLM Vendors Need to Listen”).
The full product lifecycle is not yet addressed with a
single application
Although the largest PLM vendors—Dassault, PTC, and Siemens PLM—address
most of the elements of the product lifecycle on some level through integration adapt-
ers or partnerships, manufacturing, sourcing, and service need to be tightly integrated
with the design and promotion aspects of PLM to achieve NPDL excellence. There are
exceptions in each individual segment, but no company has closely tied together all
these areas.
One of the exceptions on the manufacturing front could be Siemens PLM. The com-
pany owns Tecnomatix, which has manufacturing process planning and modeling
capabilities as well as Xfactory for MES. Combine this with Siemens, with its Simatic
IT line (MES, SCADA, and production performance management) and general focus
in manufacturing, and Siemens PLM has the opportunity to be the only PLM vendor
offering a complete design-to-manufacture application.
Dassault’s DELMIA, like Tecnomatix, has rich manufacturing planning as well as 3D

robot and production line simulation. However, it doesn’t have MES, SCADA, sched-
uling, and manufacturing operations management functionality organically. Instead,
Dassault partners with iBASEt, Intercim, and Visiprise for this capability. PTC
acquired manufacturing process planning company Polyplan two years ago, and it
announced the integrated, improved Windchill MPMLink this past summer.
Visiprise has become an increasing presence in the PLM market this year, with the
Dassault relationship and partnerships with PTC and SAP, realizing that the deep
manufacturing functionality to manage how a product is built is not a strength of
PLM or ERP companies. MES vendor Camstar has stuck its toe in the water as well
via a relationship with PTC in the medical device market. With Siemens diving in, it
remains to be seen what the other large, manufacturing automation companies such as
Rockwell will do. We believe they will forge integration relationships with the remain-
ing independent CAD/PLM vendors, like PTC or Dassault, but not buy into PLM.
The PLM and sourcing courtship continues, but no marriage yet
Connecting the product lifecycle with direct materials sourcing makes sense. We have
always included sourcing as a core component of the PLM footprint, but only a hand-
ful of PLM vendors have built functionality in this area. The risk with global sourcing
is variability because of inconsistent lead times and product quality, hence the need to
carry more inventory. Tight integration between the two disciplines of product develop-
ment and sourcing will help minimize this variability, though. Whether outsourcing to
lower cost, developing areas of the world or more industrialized nations, end users need
help locating quality suppliers and managing material safety data sheets.
Tier 1 automotive supplier and Siemens PLM customer Visteon, a manufacturer of

climate, interior, and electronic systems, has recognized this need. One of the com-
pany’s areas of focus is to help develop low-cost cars for less than $10K. The challenge
is reducing the cost of parts and other materials purchased from Visteon’s suppliers
while still producing a quality design. As such, its procurement and engineering groups
are tightly connected through a combination of Teamcenter applications, includ-
ing Supplier Management and Teamcenter Community for improved collaboration
between these historically siloed groups. The end result is a global view of actual spend,
faster cost estimates, the ability to forecast purchases, and a snapshot of supplier perfor-
mance for everyone involved in developing and launching products.
GPD and risk management are driving the need for PLM and sourcing to unite. As evi-
denced by the recent product recall debacles in China, the ability to effectively source
quality and compliant materials and quickly find reliable suppliers to deliver what is
needed to make products in a timely fashion is a challenge. In fact, a recent AMR
Research risk management study revealed supplier failure as the biggest perceived threat
to many organizations.
Some PLM vendors have built out their sourcing and supplier management applica-
tions over the years, but the opportunity does exist to expand their functionalities and
grow into new markets. Another vendor example is Dassault’s Sourcing Central, which
provides supplier master data management, search, and RFX to the high-tech, automo-
tive, and A&D industries. Because of their heritages as ERP vendors, SAP and Oracle
provide sourcing and procurement functionality that can integrate with existing design
applications. Oracle, with the acquisition of Agile, has taken a big step forward in its
DMS capabilities, since Agile has a mature product in Product Cost Management,
which provides the strong sourcing and supplier analytics capability for high-tech con-
tract manufacturers.
The service lifecycle needs to be integrated with the product lifecycle
Another critical and disconnected component of PLM is service. Once a product is

launched, there is still an opportunity to provide value to the customer. Tightly inte-
grating service with product enables better quality management, as any product issues
are immediately communicated to the front end of design. Product documentation and
technical publishing companies like Right Hemisphere, Seemage, and Arbortext (now
part of PTC) are examples of companies that are beginning to bridge this communica-
tion between the product and service worlds. SAP also provides tracking of service-
related issues, but has not yet linked this to the PLM process. However, it recently
forged a tight relationship with Right Hemisphere to help bridge this gap.
Siemens PLM offers Teamcenter MRO for A&D manufacturers to connect engineer-
ing with service. Oracle provides a corrective and preventive action (CAPA) application
that has seen traction mostly in the pharmaceutical market, but recently in high tech
as well. What is still lacking, however, is the real-time feed of service issues from the
field into the front end of product innovation. This early warning system functionality
is critical to head off any quality issues that may arise. More tightly integrating the ser-
vice lifecycle with the product lifecycle will ultimately lead to a better understanding of
customer needs.
PLM vendors need to broaden their definitions of

CNM for emerging markets
Requirements management and issue tracking is only one element of customer needs
management, which includes the following:
• The ongoing capture of customer needs (e.g., via web survey form or online
community)
• The ability to collaborate on new product ideas in real time with internal and external
constituents
• The tracking of product issues
• Rich workflow
• The ability to draw customer information from other systems
CNM applications need to enable open innovation—a reference to the fact that knowl-
edge and good new product ideas are everywhere—with customers, suppliers, brokers,
and academia. This globally located IP drives the need for efficient data integration and
communication supported by the right technology approach, such as SOA or SaaS.
There are examples of mature open innovation processes, like Procter & Gamble’s
Connect + Develop, which employs an ethnographic approach to gathering customer
needs, but doesn’t use a PLM or ideation system to enable this process. However, most
companies we speak with have not opened up the ideation kimono, no matter what
their NPDL technology foundations are. The most prevalent tools are spreadsheets and
CRM systems, but neither provide the workflow necessary for easy communication
among NPDL teams.
3D and online communities are CNM tools
Online venues like Dassault’s 3Dvia and community collaboration application

Communispace are two examples of tools applied today to help better understand cus-
tomer needs. 3Dvia, launched earlier this year, is a site that can be used by designers to
share 3D models and concepts with an audience before physically manufacturing the
design. The most radical 3D application by a traditional CAD vendor that we’ve seen
is Dassault’s joint venture with advertising firm Publicis called 3D SWYM (See What
You Mean), in which ad concepts can be shared with potential customers. The offline
focus group is being enhanced with low-cost, online ideation mechanisms that enable
companies to quickly iterate on ideas.
Eric von Hippel, professor and head of the innovation and entrepreneurship group at
MIT’s Sloan School of Management, has spoken about “user innovation communities”
as a vehicle for innovation—that is, enabling user communities to drive the traditional
manufacturing-centric, fuzzy front end of product development by innovating and col-
laboratively filtering ideas. One benefit is a consistent pipeline of ideas and customer
needs—endless fuel for your NPDL process.
One often cited example is a favorite childhood toy, Legos. In 1998, Lego launched its
Mindstorms line of toys (mechanical/robotic theme). Shortly thereafter, a number of
software developers altered the code in the robots and shared their designs online. The
company’s response was to create the Lego Factory, an online community of 200 inter-
nal developers and 20,000 external “Lego hackers” that shares designs and is a source
of new product ideas for the company.
Communispace also develops and manages online communities for companies like Kraft,
which used information from its community to develop the 100-calorie snack-pack line of
crackers and cookies, resulting in $100M in sales the first year in the market.
The providers
Vendor dynamics: the market continues to consolidate and evolve
The past two years have been dynamic for the PLM market. Consider the following
examples:
• Agile and MatrixOne, the last two major independent PLM vendors, being acquired
by Oracle and Dassault Systemes, respectively
• Shop-floor companies like Camstar and Visiprise forging relationships with PTC
and Dassault
• Niche portfolio management and decision support vendor Sopheon becoming a
consolidator by acquiring roadmapping company Alignent and the assets of the now
defunct Integrated Development Enterprise (IDe)
Meanwhile, Siemens Automation and Drives acquired UGS, which acquired manufac-
turing process planning and modeling company Tecnomatix. PTC acquired Polyplan,
which is now Windchill MPMLink.
Most recently, PTC agreed to buy small 3D CAD company CoCreate. SAP continues
its organic growth in PLM, enhancing both discrete and process manufacturing capa-
bilities by simplifying the UI and improving product development and manufacturing
definition, as well as product and process synchronization. The state of the market is
essentially a battle between the ERP vendors (Infor, Oracle, and SAP) and CAD ven-
dors (Dassault, PTC, and Siemens PLM), with niche vendors filling in the gaps.
Figure 7: PLM suite vendors expand from traditional strengths
Independent
Dassault/MatrixOne, Oracle (Agile)
Financial Customers Business Data

Design/ Human Resources Suppliers ERP
PLM
Product Lifecycle Decisions Oracle
Dassault Define Design Promote Supply Support SAP
Siemens Infor
PTC Industry-Specific Needs
Product Plant
Product/Process Data Requirement Supply
The choice in PLM vendor that manufacturers make depends into which vertical mar-
kets they sell, the NPDL challenges they face, and their system users. Table 1 helps
illustrate the choices.
Table 1: PLM vendor section decision tree

Common
Major Decision
Considerations Points PLM Features To Look For Guide to Choosing a Vendor
Industry Discrete BOM configuration management. Any vendor except process specialty ven-
Requirements Manufacturing Unique discrete industry strength. dors. Several vendors have industry special-
ties. Consider regulatory needs.
Process Formulas and recipes. Specification Start with the process specialists, then
Manufacturing management. look beyond. Several discrete vendors
have expanded to manage process data.
Consider regulatory needs.
PLM Process Design-Centric MCAD/ECAD data management. Vendors with a CAD legacy are strongest
Emphasis Design process automation/reuse. with their native application. Decision is
more open if multi-CAD.
Business- Link design to order management. ERP vendors best manage PLM where
Centric Data most used beyond engineer- design has less emphasis than business pro-
ing. cesses, including aftermarket.
Global Data Access Web access to documents and data. Team program management and simple
Requirements View and markup. vaulting may work well. Deep PDM may not
be required.
Process Flow Participate in workflow process. Look for a robust configurable workflow
Interactive collaboration. that scales. An easy to use but inflexible
system may not be best.
Internal Resource Major Subscription/hosted/on-demand. Investigate an ASP or other hosting options.

Constraints Limitation Strong training program. Look for solid training support either online
or as a prepackaged option.
Minor Issue Standard licensing model. Flexible Consider a highly configurable or program-
workflow and modeling. mable application if resources can support
continuous process improvement.
Use Existing IT Primary Goal PLM within ERP/CAD or technology Consider if legacy vendors’ native PLM path
Applications platform provider. is sufficient. Next look to their PLM part-
ners, or push for partner support.
Secondary Independent PLM with an open Start with the application that best satisfies
Goal architecture. the biggest pain. Choose an open architec-
ture for legacy integration.
Industry vendor comparison
As PLM gains traction in emerging vertical markets like retail, consumer products (CP),
and food and beverage, so do vertically-specific PLM vendors. Apparel and footwear
needs a system to manage the changing fashions throughout the year, the multitude of
product lines, and a calendar of activities, all of which are areas that can be supported by
PLM applications from Dassault, Freeborders, Gerber, Lectra, NGC, PTC, Siemens
PLM, and TXT e-solutions. Each application, however, has its own strength:
• Dassault, Lectra, and PTC offer the most mature full-footprint apparel applications.
Dassault provides an industry template, or what it calls an accelerator, with standard
apparel business processes built in. PTC complements its product with a team of
industry experts.
• Siemens PLM also provides a preconfigured application template that can be easily
modified. It’s had an apparel and footwear application for the past three years.
• Lectra, with its acquisition of Kaledo, now has rich design functionality to comple-
ment its line-planning and management dashboard offerings.
• NGC’s heritage is in shop-floor control systems and sourcing, while Freeborders
excels in collaborative design, although it doesn’t solely focus on apparel.
The CP and grocery industries face many of the same NPDL challenges as apparel
and footwear, such as managing portfolios of products, rapid product launches, sup-
plier management, and quality management. Agentrics, the product of the merger of
WWRE and GNX, provides sourcing, supply chain collaboration, product specifica-
tion management, and global data synchronization for the private-label food and CP
industries. The company has rich sourcing functionality in GenSource, which it aug-
ments with its PLM application GenNovation. If you haven’t heard of Agentrics, it may
be because most customers put their company names on the Agentrics system to keep
their brands top of mind and consistent throughout their supply chains.
Life sciences remains a relatively immature market for PLM vendors, despite business
challenges that could benefit greatly from PLM: regulatory compliance, knowledge
management, and the tightening relationship between R&D and manufacturing. Other
challenges life sciences face, but that are not strengths of most PLM applications today,
include supplier management and understanding the voice of the customer. PLM ven-
dors like Dassault, Oracle, PTC, and Siemens PLM have delved into medical device
because of their discrete heritages, but don’t have the formulation capabilities like pro-
cess PLM players Enginuity and Selerant to support pharmaceutical product develop-
ment. It should be noted, however, that Oracle does target the pharmaceutical market
with its Product Governance & Compliance (PG&C), Portfolio Management, and
Quality Management applications.
Figure 8: PLM vendor target audience focus
Business
Suite vendors
are expanding
in both directions
SAP
Selerant Infor
Target audience
Oracle
Autodesk Enginuity
Design
PTC Dassault
Arena
Siemens PLM
Aras
Manufacturing
Point PLM Footprint Full
Notes:
Manufacturing needs: process planning, CAM, CAE, MES
Designer needs: CAD, formulation, PDM, Simulation
Business needs: program management, PPM, CNM
Table 2: PLM vendor landscape
Collaborative Product Product Direct Customer

CAD or Product Data Portfolio Materials Needs
Vendor Formulation Design Management Management Sourcing Management
Aras
Arena Solutions
Autodesk
Dassault Systemes
Enginuity Formulation Process
Infor Formulation Process/Discrete
Oracle (Agile) Formulation Process/Discrete
PTC
SAP Formulation Process/Discrete
Selerant Formulation Process
Siemens PLM
Software (UGS)
Vendor Focus
Low High
PLM Industry Best-of-Breed

Specific PLM Point Applications
Collaborative
Product Product Product Direct Customer
CAD or Design/ Data/Spec Portfolio Materials Needs
Retail Formulation Formulation Management Management Sourcing Management
Agentrics, Gerber, Ansys, Centric, Auto-trol, Artemis, Arrow, Accept
Freeborders, Cadence, Design2- Product Sight, Computer Cohesia, i2, Software,
Lectra, NGC, TXT Lascom, Launch, Softech Associates, Manugistics, Bright Idea,
e-Solutions Mentor Lattice Centric Partminer, Cincom, IBM
Graphics, MSC Technologies, Software, Powerway Rational,
Software, Microsoft, Deltek, Imaginatik,
Synopsys Right Emcien, Invention
Hemisphere, Jonova, Machine, Mind
Shawk, Think3 Microsoft, Matters, Rapt,
Powersteering, Rulestream,
Primavera, Ryma,
SmartOrg, Satmetrix,
Sopheon, Serena,
Symphony Strategyn,
Metreo, Telelogic,
Telelogic TDCI, VOC
Online
Table 3: Vertical industry focus
Indus-
Auto/ High trial/ Apparel/ Chem/ Medical Pharma/ Food
Vendor A&D Tech Discrete Textiles Process Device Biotech and Bev. CPG
Aras
Arena
Solutions
Autodesk
Dassault
Systemes
Enginuity
Infor
Oracle (Agile)
PTC
SAP
Selerant
Siemens PLM
Software (UGS)

Primary Industries
Emerging Industries
PLM application areas
Customer needs management
Companies understand they need to know their customer needs first by linking to
demand insights before designing and launching a product (again see Figure 1). Decision
support capability is key to understanding these needs and the tradeoff versus the cost
to serve in an iterative fashion. The reality is most companies have immature CNM
processes, relying on ad hoc discussion, spreadsheets, and, in some cases, CRM systems
for new ideas. The reason for this is likely that people don’t think of CNM as a system,
but as a way for tracking requirements. Although companies usually have a customer
advisory board, it’s rare to find an organization that has the processes and technology in
place to support consistent open innovation. This is changing, however, as vendor rev-
enue analysis of the past two years shows CNM grew at 15% and 22%, respectively.
Some PLM suite vendors have basic requirements management capabilities in their
products, but have been slow to provide a platform for collaboration with all the afore-
mentioned constituents. They also haven’t integrated with other customer-centric sys-
tems. Capturing requirements is the foundational functionality necessary to ensure new
and existing products meet customer needs. But a continuous loop that logs requests,
quality issues, and feedback on prospective designs is necessary for manufacturers to
derive the benefits of CNM and for vendors to provide in their stacks if PLM is to
become a value chain enabler.
Vendors that have begun to step up to meet this challenge include SAP and Oracle,
which, through their respective xPD and PPM (Agile) products and existing CRM
capabilities, offer multiple avenues to understanding customer needs. Circling these
needs into the design process will require integration to whatever design system is in
use. In particular, IBM, with its pending acquisition of Telelogic (which includes Focal
Point), could provide the most mature requirements management and decision support
functionality.
The challenge for design-centric vendors like Dassault, Siemens PLM, and PTC is that
the CNM opportunity exists, but mostly in nontraditional PLM markets like retail,
CP, and consumer electronics. In these fast-moving markets, it’s critical to have a finger
on the pulse of the market at all times to sense and test new ideas. But as these com-
panies build out their teams in these verticals with the necessary industry expertise to
understand the CNM functionality needed, as well as to mature their CNM applica-
tions to complement their strong design heritages, they will make it difficult for SAP,
Oracle, and niche ideation companies, such as Imaginatik and Invention Machine, to
compete in this area.
Product portfolio management
According to our market sizing data, this segment of PLM has grown the fastest over
the past two years and could potentially grow at a 15% CAGR, largely because more
than 50% of all product launches fail for the following reasons:
• Poor correlation between benefits and R&D investments
• Poor demand response for new products
• Warrantee and compliance issues abound
• Poor alignment to customer needs
• Lack of coordination across global markets and supply chains
Many of these issues can be alleviated by PPM, with some PLM suite vendors growing
their PPM functionalities inorganically (for example, PTC through Cognos for analyt-
ics and Siemens PLM through Planview). Others like Oracle (Agile’s products), SAP,
and Dassault (MatrixOne product) have offered applications organically in this area
for the past couple of years. Best-of-breed PPM vendor Sopheon has garnered the most
mindshare recently, especially in process industries like chemical and pharmaceuticals.
Much like requirements management does not equate to full-fledged CNM, project
and program management is not PPM. Understanding the nature and status of projects
as well as who inside and outside the organization is working on a particular project are
two areas at which project management excels. PPM takes the management of projects
and adds modeling and performance management functionality to product manage-
ment and product lines that enable a company to grow its top line. It provides basic
project management in addition to the following functionality:
• Management of the product portfolio in both a development pipeline and the mar-
ketplace
• Product pricing optimization, where tight integration with CNM becomes important
• Analytics and reporting, including modeling the performance and capability to make
new products
• Product roadmapping
• Risk management
• Defining budgeted costs and tracking project resources
PPM applications still have room for growth. Even the most mature PPM offering in
the market today, Sopheon, is working to add functionality like risk management and
analytics.
Direct materials sourcing
DMS is a rapidly growing segment of the PLM footprint. To date, the product develop-
ment and procurement teams have been disconnected, but this is changing. GPD and
environmental compliance regulation is driving the need to strategically align procure-
ment with the rest of the organization. In fact, chief procurement officer is an evolving
title at many Fortune 500 companies.
Dassault ENOVIA (MatrixOne products) and Oracle (Agile) evolved their supplier
relationship management and sourcing applications early on to complement very
strong PDM and good product and program management capabilities. Siemens PLM
has grown its sourcing and supplier management capabilities with the Asian Sourcing
Network (in conjunction with AT Kearney and TCS), but has not expanded its offer-
ing to some of the newer markets that could benefit most from this functionality, like
apparel and footwear.
Agentrics also provides a mature supplier management and sourcing application to

complement its data management, packaging, and collaboration capabilities. This is
the one company we looked at that started with its DMS capabilities first, then evolved
into other areas of PLM, mostly through acquisition and partnership (with UK quality
management and supplier audit company Muddy Boots Software). Despite having a
mature DMS product, the company has no plans to delve into other markets.
Collaborative product design
All PLM vendors provide applications to bring the NPDL teams together, either to col-
laborate on CAD or a visual representation. Vendors that come out of a CAD legacy
provide rich collaborative mechanical engineering environments. Others provide visu-
alization for multiple design environments, with software like Cimmetry AutoVue,
an Oracle product, which is embedded in many PLM applications. The differentia-
tor is how PLM vendors define collaborative product design (CPD)—that is, how far
upstream in the organization. CPD has historically focused on engineering collabora-
tion, but it’s being redefined as manufacturers realize the benefits of sharing 2D draw-
ings, 3D models, and formulas with other NPDL constituents inside and outside the
organization for better product documentation, quality, customer service, and ideation.
In particular, Dassault and SAP are on the redefining-CPD bandwagon with Seemage
and Right Hemisphere, respectively. Siemens PLM and its JT format is also on board,
as well as Adobe.
For PLM vendors, the business opportunity for CPD today is to facilitate open innova-
tion between design, the shop floor, and suppliers in manufacturing. There are applica-
tions to support this demand, with Autodesk and its Design Review platform, Dassault
with manufacturing process planning and modeling product DELMIA, Siemens PLM
with Tecnomatix, and PTC with its MPMLink product (strictly process planning
versus manufacturing line or robot simulation). There are other successes in this seg-
ment of PLM, including Right Hemisphere with Sikorsky. This application started
out in the customer service department to enhance technical publications and recently
expanded to manufacturing and product development for the sharing of compressed,
lightweight models because of its success.
Product data management
Most manufacturers have their product data under control, so the PDM revenue oppor-
tunity is slowing (8% five-year CAGR). Some opportunity remains, though, depending
on the granularity of the specification. For example, in software and electronics, CAD
requires richer PDM functionality, since there are many moving parts and elements to
detailed software programs or complex electronics like cell phones or computers.
As PLM expands to emerging markets like retail soft goods, consumer products, and
life sciences, the foundational layer is PDM. Getting product data under control is the
reason why PLM has taken off in the apparel and footwear market. The multiple sea-
sons of retail produce multiple product lines that can include thousands of styles and
SKUs, necessitating iterative approval activities like lab dips, strike-offs, and samples.
Although existing applications don’t manage the development of products lines well,
they do excel at managing the development at a style level. Vendor functionality in this
area will likely evolve over the next 12 to 18 months.
With process manufacturing industries, the challenge is that formulas are continu-
ously tweaked without any purging of old specifications. Because of this, the data store
required is immense. Within this data store (i.e., the specification management sys-
tem), manufacturers need to have the ability to link formulas, packaging specifications,
manufacturing locations, geographic sales locations, and regulatory information. Infor
(Optiva) refers to this as the bill of information (BOI).
Quality management
Most vendors are able to check the box when asked if they offer quality management,
but few offer true detection-to-correction CAPA products. Two vendors that do are
Oracle, through its acquired Agile assets, and Aras, which has an advanced product
quality planning (APQP) and failure modes and effects analysis (FMEA) risk man-
agement offering to complement its product engineering and program management
capabilities. A relatively young company, Aras has gained traction in automotive, A&D,
and high tech with its holistic quality planning and management application. Oracle
launched its quality management application six years ago. The product took off ini-
tially in life sciences, but now is gaining traction in high tech as companies in this
industry realize the importance of maintaining a constant feedback loop between prod-
uct development cycle times.
Environmental compliance
PDM is one primary necessity to enable a design-for-environment strategy. PLM ven-

dors naturally gravitated to offer compliance data management applications and are
adding supplier management functionality as well. Siemens PLM offers one of the
strongest offerings in this area through Teamcenter and its partnership with envi-
ronmental data management and analytics company Synapsis. Dassault’s ENOVIA
MatrixOne, combined with environmental consulting firm Tetra Tech, also provides
a strong application. PTC’s compliance offering is enhanced with the acquired assets
of IHS, i2 Technologies’ former content management application, and testing house
Underwriter’s Laboratory (UL). Aras offers RoHS and WEEE regulation templates,
which are application extensions that identify substances on a part-by-part basis and
cross-reference each European Union RoHS or WEEE regulation. Oracle (Agile) was
one of the first to market with its PG&C application, and it continues to mature this
offering to address the evolving regulatory landscape.
These applications enable manufacturers to accomplish job No. 1 in environmental

compliance: getting product data under control. Job No. 2 is getting suppliers under
control and having a collaborative platform for communication, requesting material
safety data sheets and testing when required, and maintaining scorecards on each sup-
plier to determine during the design process, not after discovering a noncompliant part
or material, the ones that can provide the required materials. Another important aspect
is keeping up with regulation changes, as Aras strives to do with its application, as well
as services firms Tetra Tech, 5-Trees, The Goodbye Chain Group, and the environ-
mental law firm Allen & Overy. All these capabilities rolled into a PLM offering help
manufacturers achieve a true design-for-environment approach to product development,
which is important as environmental regulations evolve and new directives come on
board, like the energy efficiency directive, EuP.
Vendor landscape methodology
This research study reviews application vendors that provide multiple components of
PLM functionality to manufacturers across multiple industries. AMR Research required that
participants be PLM suite vendors selling products that span several, but not necessarily
all, PLM functionalities.
Qualification for inclusion
This Report is a review of PLM suite vendors with at least three of the five PLM footprint
elements and, most importantly, that manage the product specification or bills of
materials (BOMs) across multiple vertical industries, including discrete, process, and retail
industries, enabling collaborative design and program management inside and outside
the company.
Here are the five elements of the AMR Research PLM footprint:
• Product data management—Product information repository
• Collaborative product development—Design of products and processes across the
NPDL cycle
• Direct materials sourcing—Sourcing of standard or custom parts and materials, as well
as supplier collaboration
• Customer needs management—Managing customer or market input and collaboration
• Product portfolio management—Managing analytics, decision support, and resources
in product development
PLM vendor profiles
Aras
2006 was a year of introspection and transition for Aras. What is the company’s plan
for growth for its Innovator product? Is the current model sustainable? How can it
survive as best of breed? Aras tackled these questions and made drastic changes in its
business model. The company now gives the software away for free, is open source,
enables customers to have an unlimited number of users, and makes its money solely
on services. Aras’ technology approach is unique from most PLM vendors, with an
SOA based on Microsoft Windows Server and SQL Server. The product also ships with
a browser-based interface and has configuration options for Microsoft SharePoint and
Office clients, so users can work in the virtual environments with which they’re famil-
iar. The company’s mission isn’t so much to provide a platform to manage the product
lifecycle stages, but rather to facilitate the product workflow that needs to occur to
manage programs and engineering changes as well as compliance and quality issues. In
its own words, Aras is filling the gap between PDM and ERP.
The result of the new approach has been positive thus far, with 12 new deals in the
past year based on its deployment and services packages. The company’s Quick Start
package, for example, is $9,990, with deployment services including process consult-
ing, training, and rollout planning. Coupled with the subscription support packages for
enterprise companies ($8,300/month) and SMBs (starting at $750/month), this gives
Aras a nice reoccurring, predictable revenue stream. It also benefits greatly from a tight
partnership with Microsoft for the Microsoft Dynamic AX (formerly Axapta) product.
We think Aras’ quality management module is a strength, providing functionality for

such quality processes as APQP, FMEA, CAPA, ISO 9000 document management,
and basic quality assurance (QA) processes, quality control (QC), defect and noncon-
formance tracking, and customer complaints. A Tier 1 auto supplier we spoke with pur-
chased Aras primarily for this ability, using the application to connect the previously
Excel-based disparate sets of data that supported its APQP process. The company ini-
tially looked at quality management point applications, but ultimately went with Aras
since it offered a more complete application (from program management to manufac-
turing and quality), a flexible technology core that integrated easily with the Progress
Software tools it had in place, and, of course, the free software and subscription model.
Although the auto supplier doesn’t use Aras’ product engineering or program manage-
ment functions at this time, it does plan to roll out the latter next year, which will
increase the number of users from 30 to 150. This is a typical size implementation
for Aras in its key industries (automotive, consumer electronics, and semiconductor),
although it has scaled to as large as 600 users and 22 sites across North America on a
single server instance.
Arena Solutions
Times are pretty good for Arena in the SMB market as the sole SaaS PLM offering,
with over 300 customers. Although the company has struggled to penetrate the enter-
prise level, it does have some reasonably large implementations of up to 1,000 seats. But
Arena knows it will never be the preferred PLM vendor of choice for a large automotive
or A&D company. The product configurations and supplier relationships are complex
enough that companies like Boeing, for example, prefer to keep their PLM information
and processes within the four walls, managed by systems that can support the com-
pany’s electromechanical product development processes. Arena, formerly BOM.com,
excels at managing the product data, engineering change, and quality management
that industrial products companies require. Current customers include Segway, Air
International Thermal, Sirius Satellite Radio, XM Satellite Radio, Tesla Motors,
and Foundry Networks.
Last year, the company released a PPM module. Although it’s not a decision support
and analytics engine, the module does enable the management of projects and prod-
ucts in a company’s current product development pipeline, tying together the project
and product records. Despite the absence of a rich analytics engine, Arena does offer a
reporting module that provides preconfigured reports for compliance (RoHS, WEEE),
BOMs, and issue tracking.
One area of opportunity for the company is to forge relationships with the larger
PLM, CAD, and ERP companies. These companies, most of which have been loathe
to commit 100% to the SaaS model, could use a relationship with Arena to penetrate
the expansive SMB opportunity. Current partnerships include a network of small U.S.-
based, third-party deployment companies, as well as electronic component distributors
Avnet and electronic component data management firm Promiere.
Autodesk
Autodesk positions itself as a design software company, not a PLM company, but it has
forged integration relationships with SAP, Oracle, Microsoft, and PTC in order to be
the WIP foundation for engineering collaboration and manufacturing process planning
across the enterprise. As Autodesk established these partnerships, its collaboration capa-
bilities have grown, positioning it to be the WIP foundation for what it calls the “cross-
enterprise digital pipeline.” Autodesk continues to be the largest presence on the SMB
engineering desktop and in the broader design community, with 650,000 Inventor and
90,000 Vault users. The company also experienced 270% growth in Inventor commu-
nities. One success story is drive and control engineering firm Bosch Rexroth Canada,
which went from the manual sharing of 2D designs with the shop floor to using
Autodesk Inventor to share 3D models, leading to decreased design times and manufac-
turing errors.
Attend an Autodesk customer event and you will understand why the company has
surged to $2B+ in revenue. The following is cult-like, and this is primarily with
AutoCAD, its 2D product. Inventor, its 3D application, is a growing but still small por-
tion of the company’s revenue (22%). Its primary industries are automotive, industrial
manufacturing, and architecture, engineering, and construction (AEC). With its newly
announced free design collaboration site Freewheel (similar to Dassault’s 3Dvia site),
however, the company has potential to expand its footprint into markets where 3D is
not as prevalent, like CP.
Autodesk will focus much of its efforts on growing its presence in the AEC market
over the next 12 to 18 months, with its Revit product connected to AutoCAD and its
design visualization tool, 3ds Max, enabling building information modeling. This will
enable closer connection of design data with the construction process. From a manu-
facturing standpoint, the company will continue to use 2006 acquisition Alias together
with Inventor as well as product design and data management products Vault and
Productstream to provide digital prototyping and collaboration between design, engi-
neering, and manufacturing.
Dassault Systemes
Dassault has seen success over the years in the CAD market and continues to see
opportunity in the traditional engineering realm but has also pushed upstream to non-
engineers, like marketing, sales, customer service, and service technicians. In the past
year, the company announced a portfolio of 3D entities:
• 3DLive—For collaboration across enterprise
• 3DVIA—An online community for designing, sharing, and publishing 3D models
• 3D Swym (See What You Mean)—A venture with Publicis and other ad firms that
allows marketers to share concepts with customers to get their feedback before going
to market
Coupled with production planning and modeling application DELMIA, design tool
CATIA, simulation application SIMULIA, and its ENOVIA products (MatrixOne,
SmarTeam, and VPLM), it’s apparent Dassault has all the pieces to round out the PLM
footprint.
Of course, the challenge is execution. Selling to vertical markets and new audiences
across multiple product lines takes resources from sales, system implementation, and
consulting sides. Consulting, change management, and training are distinct opportuni-
ties in some markets to which Dassault is new, including retail, CP, and life sciences.
This is because the buyers in these markets are immature in their understandings of the
benefits and applicability of the technology. It’s also because retailers and life sciences
professionals, for example, want to speak to industry experts instead of someone who is
adept at selling CAD to build airplanes.
The 3D for All strategy is visionary, but it may not pay financial dividends in the short
term. However, it does expand the positioning of the company from workgroup design
centric to enterprise innovation centric. As PLM evolves from a CAD data management
hub to the enterprise-wide collaboration platform, Dassault will be well positioned to
support this not only through its 3D approach, but also at the business layer with its
ENOVIA Program Central, Product Central, and Supplier Central Products (all of
which are former MatrixOne products).
This holistic approach is one of the reasons why one consumer electronics manufacturer
decided to use Dassault as its PLM application: the ability to centrally manage product
data, provide strong business processes around BOM management, and connect the
product development process at the program and supplier level. At the manufacturing
layer, DELMIA provides manufacturing process planning as well as robotic and manu-
facturing line simulation, which gives insight to how a product will be built before the
manufacturing line is even started. Another similar example in scope is a recent win,
LG Electronics, which selected ENOVIA MatrixOne.
Enginuity
Enginuity possesses one of the strongest formulation calculation engines in the mar-
ket. But, as with most best-of-breed vendors, some have questions about whether the
company is too small to support global formulation teams. Conversations with compa-
nies like P&G prove otherwise, with Enginuity’s FWS system managing global R&D
and formulation across nine product categories in the healthcare and beauty business
units. Led by former P&G employee John Sottery, Enginuity has developed a central
repository of data to enable reuse of information, particularly during the formulation
experimentation process. The obvious benefits of this are improved productivity, easier
collaboration, and faster time to market.
Enginuity also works with Revlon, Schering-Plough, and Zotos, the haircare com-
pany. We spoke with Zotos, which said Enginuity helped alleviate the challenge of
searching and traceability between formulas as well as linking any file to the formula:
artwork, manufacturing histories, or approval documents. This is where document
management company Documentum (part of EMC) comes in as a key component of
the Enginuity offering. It should be noted, however, that Enginuity is open to integrat-
ing with other document management applications.
Process manufacturing companies have a unique set of requirements that demands an

expertise most traditional PLM companies don’t have. The one possible exception is
Siemens, with its process-centric Simatic IT. The product could be (if integrated) a nice
adjunct to the joint UGS-developed Research Knowledge Management (RKM) applica-
tion, designed to link packaging specification information with formulation and labora-
tory information management system software. Larger PLM companies that are more
discrete industry focused have been loathe to invest in building the teams required to
make R&D professionals comfortable buying from them. As a result, small formulation
experts like Enginuity have been able to thrive in this nascent market. But how long can
these smaller companies exist on their own, especially since many are privately funded?
As the opportunity expands beyond R&D to the supply chain, larger players in the
market will accelerate their footprints in the process space, primarily to formulation. The
net is the window of opportunity for companies like Enginuity to capture market share
and grow exponentially in the next 12 to 18 months. For Enginuity to accomplish this
is, it will focus less on adding features and functionality and more on marketing to edu-
cate its target audiences (R&D, supply chain, and CXO) on its expertise in health and
beauty and pharmaceutical formulation, as well as why spreadsheets don’t cut it in GPD.
Infor
After Infor’s last two acquisitions this year, government software application provider
Hansen and workforce management company Workbrain, the company said at its
recent customer conference that it was done making acquisitions for a while (it has
made 31 since 2002). This is a wise move, as this gives Infor time to digest its many
assets and continue building an infrastructure for products, sales, and the channel.
Infor’s acquired PLM applications—discrete manufacturing product PLM8 (formerly
Baan), process manufacturing application Optiva (the former Formation Systems prod-
uct), and retail industry product RunTime (formerly the Geac product)—is primarily
sold to the midmarket with Infor’s ERP suite. Infor’s PLM focus today is primarily in
the process space with Optiva, gaining traction with food manufacturers like Rich’s
Foods, and in consumer products and pharmaceuticals with a large, Fortune 500
company. From a discrete industry standpoint, Infor recently announced that it would
reverse a prior decision by SSA (another of its acquired companies) to discontinue sup-
port for Baan IV and V and provide support instead of forcing migration to its LN
product. This is not surprising given that there are 6,000 worldwide users of Baan.
One Infor customer we spoke with, a large food and beverage company, had some of
the classic challenges of product development, including centralized management of
data, collaboration across teams, quality management, and global risk management.
Infor’s Optiva product was applied to address these issues, in concert with Accolade,
Sopheon’s PPM product, across 800 global users including product development,
packaging, ingredient technology, operations, procurement, quality, and regulatory. As
far as challenges, it needed to spend additional time cleaning disparate forms of data
and getting buy in on the usage from stakeholders: both areas it feels it should have
addressed prior to implementation. This was not an Infor shortcoming, but rather a les-
son learned, which speaks to the services opportunity for PLM vendors to assist with
front-end data cleansing, and change management.
Infor’s plan for 2008 is to incorporate acquired performance management assets. In 2009,
PLM8 and Optiva will be available on Infor’s Open SOA. The Open SOA approach will
enable companies to have a central hub, or home page for accessing applications and data
on a role and event basis. SOA has become a necessity for enterprise software companies,
given the multiple software systems and disparate data that exist globally at most compa-
nies. Delivered as part of customer’s maintenance agreement, Open SOA also provides a
platform to integrate Infor’s solutions. Infor products currently available on Open SOA
include Infor ERP SyteLine, SCM WMS 9, EAM, and SupplyWeb. We think this service
approach will greatly benefit the company’s PLM products as global product development
is driving the need for a unifying, open platform.
Oracle
Prior to the Agile acquisition, Oracle’s PLM product was not a strong player in the
market. The Agile acquisition, however, brought rich PDM, along with mature portfo-
lio management, supplier management, and analytics on cost and quality. Combined
with Oracle’s traction in manufacturing, the PLM picture for the company is finally
rounding out. From Agile’s perspective, some clients had begun to question the scalabil-
ity and long-term viability of the company, but this acquisition alleviates this concern.
The challenge will be integrating the parts into a cohesive strategy. Oracle is in the pro-
cess of defining the PLM roadmap and integration touchpoints between Agile and the
Oracle suite of products.
Strengths of the Agile product include industry-specific workflows and templates for
FDA-regulated industries, like food and beverage and pharmaceuticals, and strong
sourcing capability, which has gained traction particularly in high-tech electronics. This
is because of the expansive network of offshore suppliers large high-tech companies
need to work with to ensure compliance, quality, and rapid time to market. Quality
management is also a differentiator, as the product provides a dashboard to spot quality
trending downward and enables root-cause analysis, risk management, and analytics.
One interesting capability is the tie between supplier management and quality, which
allows quality issues to be tied back to the supplier and develops supplier scorecards
that contain quality ratings. Harris is an example of one client using both capabilities
in concert across 6,000 engineers and 2,000 supply chain professionals inside and out-
side the company.
Oracle provides good support for the business layer of PLM with its PPM product,
which includes project and resource management, as well as tradeoff analysis. However,
the company chooses not to delve into CNM at the voice-of-the-customer and idea-
collaboration level with its PLM product, preferring to leave that to its CRM, ideation,
and requirements management products. Still, the Oracle PLM system enables users to
manage a collection of concepts, collaborate on new product ideas, and create a concept
and requirements BOM.
Oracle’s traction with new PLM deals over the year has come not just from PDM, but
from quality management, product governance and compliance, portfolio management,
and direct materials cost management. One pharmaceutical company we spoke with,
Invitrogen, experienced the challenges of a large number of SKUs, a broad portfolio of
products, and multiple product launches per month. It adopted Agile PPM and product
collaboration to provide 1,400 research scientists, program managers, and regulatory
experts on a single global instance with easier access to data, document management,
and better management of the NPDL process.
The challenge Invitrogen faced throughout the rollout is common: cleaning and ratio-
nalizing legacy data, easier part numbering, and establishing standardized processes
throughout the global organization. The future includes possible use of Oracle as the
front-end data collection mechanism to enhance its e-commerce, web content, and
labeling engines and integrate with its distribution, shipping systems, and CAPA pro-
cesses. Launched six years ago, Oracle‘s quality management initially gained traction in
the pharmaceutical market. More recently, it has seen a spike in interest from high tech
because of regulations like RoHS and WEEE as well as the hypercompetitive market in
which it works. We believe the bigger opportunity is in leveraging Oracle’s other enter-
prise assets, such as ERP, CRM, HCM, and demand management, into complementary
PLM packages.
PTC
PTC has presence in most major discrete manufacturing industries, primarily from
a design CAD data management standpoint and enterprise-wide collaborative design
rather than PPM or CNM. The company’s focus this year has been on integrating
Polyplan, the manufacturing process planning software company, into the Windchill
product line. In June, the integrated product MPMLink was announced, along with
two MES partnerships, Camstar and Visiprise, to enhance its application for IPPD.
The product doesn’t, however, enable simulation of manufacturing lines like Dassault
DELMIA or Siemens PLM (Tecnomatix). PTC has made other acquisitions as well
over the past two years, including publishing engine Arbortext (2005) and technical
illustration company ITEDO (2006). The combination of the two, Arbortext IsoDraw,
will enable the company to target new segments, such as the service parts aftermarket
and financial services. Most recently, PTC acquired a small competitor, 3D CAD and
modeling company CoCreate, primarily to add customers and history-free, dynamic
modeling capabilities.
Earlier in this Report, we discussed the need for tightly integrating the service lifecycle
with the product lifecycle. The addition of Arbortext IsoDraw, much like Dassault with
Seemage, will enable fully integrated documentation of a product design or product
repair instructions via a lightweight 3D CAD model. One use case is a service tech-
nician in the field fixing a washing machine that needs succinct, visually supported
instructions to make the repair quickly. The result is increased time in the field to see
more customers and lower repair costs.
Although a small portion of its overall revenue, one very strategic focus for PTC is
retail. By acquiring the assets of Aptavis and hiring approximately 100 retail special-
ists, the company has been able to successfully grow its presence in the industry. Using
mindshare as a barometer, it’s gaining traction: retail manufacturers we’ve spoken to
consider PTC on the shortlist of most PLM deals. One key requirement for a retail
PLM application is that it’s combined with a strong services offering. PTC provides
this through partnerships with retail consultants Kurt Salmon Associates and Walter
Wilhelm Associates.
A major product decision the company made this year was to migrate Pro/Intralink
(Pro/I) customers to Windchill PDMLink 8.0 to provide full product definition, bet-
ter change management, workflow, and item configuration. Pro/I will remain a subset
of PDMLink, but PDMLink will not include the full, detailed workgroup data man-
agement functionality of Pro/Engineer. Moving from workgroup to enterprise data
management makes sense, as it will enable distributed product management, Microsoft
Office integrations, and the option to integrate Windchill ProjectLink—all steps to
bringing PLM to the masses. However, one challenge is the normalizing, cleansing, and
migration of data that needs to occur. PTC recognizes this and has begun to explore
working with offshore Indian resources to help customers with this transition to com-
plement PTC Global Services. The company provides its ESI (TIBCO licensed integra-
tion) tool for data integration. Still, like any data migration project, the progress is slow
and tedious for many customers. In some cases, the customer may be used to working
in a Pro/I environment and won’t want to change, which may be a hindrance to upsells.
SAP
An advantage SAP PLM has over companies that historically come from a CAD back-
ground is the opportunity to use SAP’s business suite of applications, allowing users to
integrate product development with program management, SCM, and customer manage-
ment. SAP’s goal with its PLM software, based on its business process platform NetWeaver,
is to improve efficiency across the supply chain, create more visibility for NPDL stakehold-
ers, and enable easier collaboration through centralized data management.
Key areas of focus for SAP PLM continue to be portfolio and program management,
in which it includes idea and requirements management, BOM management, product
service, and product quality. Into 2008, the stated product roadmap will include an
improved UI and information search, improved product and portfolio planning, bet-
ter role-based decisions across the product lifecycle, improved product intelligence,
and stronger support for engineering and flow to digital manufacturing and service. In
particular, product intelligence is a focus moving forward, as SAP realizes intelligence
and analytics for the NPDL process are both lacking and needed, and thus stands as
an opportunity. Why it has taken so long for an application to evolve in this area is a
mystery, but since SAP owns much of the business data of a company, it has a great
opportunity to provide customers with the holistic product information they need to
model product launches and supply and demand, as well as track product success and
quality issues.
SAP’s upcoming product release of XRPM 4.5 for portfolio management is positioned
as a foundation for decision flow management (DFM), with predefined innovation
process templates such as ideas, requirements, materials, and documents. The feedback
during reference calls was that companies want to connect with their suppliers dur-
ing the design process, particularly in the automotive industry, through a simple and
secure collaboration platform. This is not to co-design products necessarily, but to share
information. One client company said it would like to see SAP expand to complex
knowledge modeling versus simple data management, where one model exists with all
information, together with constraints, rules, and processes.
We think one area SAP has a great opportunity to own is supporting the need for a
complete view of project and product profitability at any stage in the lifecycle, from
design to service. Companies need to understand how much of a particular product
they are making or how many resources they are using—a complete financial picture.
This is likely why SAP is focusing on product intelligence as a key initiative, having
recently acquired Business Objects.
Selerant
Selerant is the oldest best-of-breed PLM company focused on process manufacturing,

with 200+ customers worldwide in the food, CP, and chemical industries. Most are
based in Europe, as is Selerant, but it does have a strong presence in the United States
from where it derives 30% of its revenue. The company started as a compliance soft-
ware provider for FDA-regulated industries in 1990 and has evolved its footprint to
include formulation, product and packaging, specification management, sample man-
agement, and portfolio management. Selerant offers the broadest footprint of the avail-
able best-of-breed vendors focused on process manufacturing.
Two years ago, the company developed a web-based composite application, DevEx for
SAP, with the process manufacturing systems integrator Linx-AS to fill what it thought
were some of the gaps existing in SAP’s formulation system at the time. Helped by
Linx-AS’s tight partnership and knowledge of SAP capabilities, Selerant has seen sales
increase because of this SAP integration. One recent product improvement builds on
legacy expertise: the application offers a regulatory framework that manages all cur-
rent and updated information regarding FDA regulations and could be extended to
support the REACH directive. The framework has a flexible process foundation that
enables companies to design their own goals and guidelines and create their own rules
to help them proactively model product designs against existing regulations. Based
on a Microsoft workflow foundation, DevEx 2.0 will be launched in spring 2008 and
include an improved UI and integration with SharePoint.
Selerant has enhanced its project management functionality, but still needs to integrate
with a portfolio management tool like Sopheon or CA’s Clarity for more robust func-
tionality. One large CP manufacturer is using Selerant to centrally manage over 1,000
ingredients and project-manage the product development process. In the future, the
company plans to roll out document management functionality for ingredients, recipes,
and manufacturing, as well as the regulatory module. As far as future prospects go, the
company continues to thrive on its own for now, but will likely face increased competi-
tion from SAP and Siemens, particularly if it decides to merge the Simatic IT specifica-
tion management capabilities with Siemens PLM’s RKM capability for packaging.
Siemens PLM Software
Acquired by Siemens earlier this year, the name UGS went away, and the new brand
is now known as Siemens PLM Software. The company’s focus has always been on the
global design chain, optimizing global engineering, easy collaboration, and openness.
Its real differentiator is in manufacturing simulation, planning, and execution.
An area Siemens PLM has increased its focus this year on is PPM and analytics. It
forged a partnership with portfolio management vendor Planview last year and, with
Teamcenter 2007, has deepened this relationship to enhance Teamcenter Portfolio
Management. For the first time, Siemens PLM has unified all components of the appli-
cation, from the former SDRC and Unigraphics, on a single data model. The only
exception is Teamcenter Community, which will operate independently using Microsoft
SharePoint. These capabilities include the following:
• Integrated requirements management
• Integrated program and portfolio management
• Integrated direct materials sourcing
• Maintenance, repair, and overhaul applications
• A business modeler to simplify deployment
• Integration of multiple manufacturing data streams into a single environment for
better manufacturing planning and execution
Earlier this year, other key product announcements were made, setting the stage for the
unified platform announcement of Teamcenter 2007. This included NX5, which now
includes history-free modeling and role-based UIs, as well as Tecnomatix on a single
data model with enhanced robotic line simulation.
One area where the company has seen growth is in SMB with the Velocity product
(19% year-over-year growth), a bundled CAD, modeling, and PDM product. This
growth was probably helped by its close integration with Microsoft, a prevalent NPDL
platform for SMBs. Today, Teamcenter is available on .NET and now fully supports
Microsoft SQL Server 2005 and SharePoint. .NET and Office 12 are available to
Teamcenter Express (PDM) customers. The close four-year-old relationship between
Siemens PLM and Microsoft makes sense, since Microsoft has an avenue to expand
into manufacturing and Siemens to the SMB market.
As part of the $113B Siemens A&D division, the Siemens PLM group now has
extended production management capabilities, inroads to process manufacturing
industries through the Siemens Simatic IT product line, deep pockets to grow pres-
ence in emerging markets like CP, food and beverage, and retail, and PPM and CNM,
complemented by rich product analytics. The next 6 to 12 months will be spent sorting
through this wealth of opportunity and deciding on the product roadmap.
IBM and Microsoft’s unique role in PLM
Although not included in our vendor landscape tables since they typically partner with or
support the full-suite PLM products on the market today, IBM and Microsoft play a critical
role in many companies’ product innovation strategies. IBM has been Dassault’s sole U.S.
sales arm for 25 years, and so has considerable knowledge of PLM best practices and
services required. In the past year, Dassault and IBM decided to move to a named-account
approach (approximately 1,000 accounts, with Dassault picking up the difference), and
IBM tightened relationships with simulation vendor MSC Software and PLM vendors PTC
and Siemens PLM. The Global Business Services group of IBM uses IBM’s software group
assets, including Rational, with the goal of becoming the innovation platform of choice
supported by its infrastructure products: Information Management (e.g., Ascential), Lotus,
Tivoli, and WebSphere.
In our surveys, Microsoft has long been a prevalent answer to question about the
tools or applications used for PLM. Top answers typically include Excel, Word, Project
Management, and SharePoint. It has become incumbent on Siemens PLM, Dassault,
and others to forge close relationships with Microsoft. Many of their customers demand
it, particularly SMBs. Even if a company is not using Microsoft tools for innovation, it
invariably wants to design or collaborate in a “Microsoft-like” environment. Because of this,
the company’s influence in PLM is unmistakable.
PLM remains a fragmented market, with over 400 CAD, non-CAD, and electronic design
automation vendors, many of these being one-to-five-person design shops. One
consistency, however, is the ubiquitous presence of these two technology industry
behemoths lending support to the product innovation process, no matter the design,
data management, program management, or sourcing application present.
Conclusion and recommendations
For practitioners
• Is it a best-of-breed or PLM suite?—Consider the product development chal-
lenge you are trying to solve: is it simply managing CAD data and communication
between engineers, or is it effective launching of products?
• PLM should be a standard—PLM should be a standard application in your enter-
prise, just like ERP, CRM and SCM. New products are the lifeblood of your company.
• Press vendors on the scalability of their network infrastructures —Robust net-
work performance is necessary for GPD, particularly when sharing rich CAD models
globally. Some users we’ve spoken with cite network performance as a challenge,
specifically the ability to quickly communicate and transfer rich 3D models across
the global value chain to captive development centers and offshore resources. Time to
market has always been one of the top reasons why companies use PLM systems, but
if they can’t provide the bandwidth or performance required to support GPD, time
to market will suffer.
• Consider applying 3D to support other NPDL processes —3D images can be used
to enhance marketing campaigns and product manuals, support customer and field
service, and communicate new product ideas and designs to customers.
• Demand decision support functionality from your PLM vendor —The func-
tionality should include decision support across value chain, full lifecycle strategic
product planning, product portfolio analytics by stakeholder, a platform for open
innovation, robust value analysis during ideation, and centralized product knowledge
management.
For providers
• Expand the definition of PLM—Continue to feed the engineering workgroup’s
need for collaborative product design, but target the product or brand manager—
the lynchpin that connects engineering, design, product, and marketing with sales.
Designing new products involves measuring the physical constraints as well as
understanding cost data of product families and features. It also includes planning
and executing marketing, service offerings, packaging, and base pricing, all areas in
which the product/brand manager owns or at least is closely involved.
• Weave ideation and voice of the customer into your offerings —Integrate with
CRM and ideation applications to connect customer information and demand with
product rules for specific markets or channels.
• Decision support, decision support, decision support!—Provide a decision sup-
port dashboard with robust analytics to help customers measure products, processes,
and people. Keep in mind new PLM market opportunities, such as software develop-
ment, consumer electronics, and apparel, which involve quickly managing complex
product designs across different domains that necessitate rapid decision support.
• Effective collaboration between value chain constituents is key—It’s key to pro-
vide better integration and handoffs to other value chain constituents, such as pro-
gram managers, manufacturing process planners, and suppliers.
• Link into market research database and CRM systems to help analyze new prod-
uct opportunity—Integrate with a database of customer buying preferences, ideas,
trends, and issues, such as IRI and AC Nielsen. CRM systems would help vet where
the product development and launch teams should spend their time on scoping and
development. This extra step during the product planning process would be an easy
way to determine whether the market has an appetite for a particular new feature
or product before allocating any resources. This opportunity is highlighted when
you consider a study by Dr. Robert G. Cooper on new product development, which
showed that 1.2% of funds are spent on preliminary market studies and 0.8% on a
detailed market study, compared to nearly 30% on the detailed development stage.
• If you don’t already, provide a SaaS offering —There is also an opportunity for
PLM vendors with web-based, on-demand services to enable the need for rapid
innovation, particularly at small companies. As NPDL is project oriented, it makes
sense to offer a subscription-based innovation platform that product managers can
access for product planning, ideation, and portfolio management when they need
it. Multiple industries could benefit from this approach, including fast movers like
retail and consumer electronics, and traditional industries, like automotive, A&D,
and high tech, as long as the typical concerns about electronic security are addressed.
Current PLM SaaS offerings, like Arena Solutions, are recognizing this need for
stronger security.
• Extend 3D to new audiences and markets —For years, we have preached the
virtues of using 3D to enhance current product design and garner new product
ideas. Autodesk and Dassault are two of the most prominent vendors now provid-
ing 3D viewing and collaboration sites (Dassault with 3DVIA and Autodesk with
Freewheel). The idea is to entice nontraditional CAD users to play with the design,
configuration, and sharing of 3D models. Companies such as Right Hemisphere and
Autodesk, with their Design Review product, provide a collaboration platform to
enhance the sharing of designs from engineers to product management, marketing,
and sales in engineer-to-order environments. Not only will the liberal sharing of 3D
designs across the enterprise improve product design and the customer experience, it
will also provide customers with the chance to play with new product designs before
they are launched into the market, helping product and brand managers make more
accurate go or no-go decisions.
Notes
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Product Innovation and PLM

2007 Technology and Vendor Landscape Series

PLM Market Landscape: Evolving To

Market Services Report

© Copyright 2007 by AMR Research, Inc.

Product lifecycle management (PLM) vendors, seeing opportunity in enabling The

This decision support capability is critical if PLM is going to be a mainstream, enter-

Recommendations for vendors

Process-Driven PLM Framework

Value-Driven Open Innovation

Source: AMR Research, 2007

Figure 2: Stages of maturity for new product launch

Growth and Profitability

Demand Driven Value Driven

Source: AMR Research, 2007

Demand 'PSFDBTU Supply

%FöOF %FTJHO 1SPNPUF 4VQQMZ 4VQQPSU

Source: AMR Research, 2007

Figure 4: Product lifecycle management footprint

Product Portfolio Management

Direct Materials Sourcing Customer Needs Management

Source: AMR Research, 2007

As the footprint evolves, the business model stays the same

Second Life and 3D: a potential new platform for PLM

Service-oriented architecture (SOA) has long held promise as an integrating platform,

Decision support and product analytics remain

Sitting at the apex of data in the enterprise—engineering and product development on

Figure 6: Product manager at the apex of data

Engineers Looking from other directions are Sales

Source: AMR Research, 2007

Dassault’s DELMIA, like Tecnomatix, has rich manufacturing planning as well as 3D

Tier 1 automotive supplier and Siemens PLM customer Visteon, a manufacturer of

Another critical and disconnected component of PLM is service. Once a product is

PLM vendors need to broaden their definitions of

3D and online communities are CNM tools

Online venues like Dassault’s 3Dvia and community collaboration application

Vendor dynamics: the market continues to consolidate and evolve

Figure 7: PLM suite vendors expand from traditional strengths

Financial Customers Business Data

Source: AMR Research, 2007

Table 1: PLM vendor section decision tree

Internal Resource Major Subscription/hosted/on-demand. Investigate an ASP or other hosting options.

Source: AMR Research, 2007

Point PLM Footprint Full

Source: AMR Research, 2007

Collaborative Product Product Direct Customer

Enginuity Formulation Process

Infor Formulation Process/Discrete

Oracle (Agile) Formulation Process/Discrete

SAP Formulation Process/Discrete

Selerant Formulation Process

PLM Industry Best-of-Breed

Source: AMR Research, 2007

Customer needs management

Agentrics also provides a mature supplier management and sourcing application to

Collaborative product design

Product data management

PDM is one primary necessity to enable a design-for-environment strategy. PLM ven-

These applications enable manufacturers to accomplish job No. 1 in environmental

Qualification for inclusion

We think Aras’ quality management module is a strength, providing functionality for

Process manufacturing companies have a unique set of requirements that demands an

Selerant is the oldest best-of-breed PLM company focused on process manufacturing,