First, I think we agree on a couple of points: 1) There are a very large number of small to meduim sized businesses (SMB) that could benefit from PLM tools, 2) Implementing PLM in a company of any size should only be undertaken if it yields real benefits and 3) To date, penetrating this market has been difficult.
I believe the real barrier to entry does not lie with the SMBs, but with the currently available PLM product offerings and the vendors that supply them.
I quick look at the history of the CAD industry provides some insight. The CAD Industry started in the late 1970s. CAD Systems were very expensive and were exclusively used by very large companies (starting to sound familiar already?) mostly in Aerospace and Automotive. Over the years CAD expanded to some suppliers, but most companies still did design work on the board.
At some point a very low-cost solution emerged (AutoCAD) and all the small companies started using it because it fit within their budget constraints and it seemed to be a better fit from an ease of learning and ease of use perspective. In addition, they didn’t need t full-time systems administrator (CAD Manager) to manage it.
Among the high end systems, 3D solid modeling emerged as superior technology (PTC in the late 1980s). Most engineering and design professionals wanted to use this technology, but they were stuck between the high cost of CAD systems where they could do 3D Solid Modeling and AutoCAD which left them stuck in 2D, but at an affordable price.
In the early 1990’s each of the major players in the high-end CAD market tried to provide better solutions to (and gain more customers) with smaller companies by re-naming, re-branding and repackaging their existing solutions. These packages (PTC’s Pro-Jr, SDRC’s Artisan, Intergraph’s EMS Lite, etc.) were largely unsuccessful in luring small to medium sized companies into purchasing 3D Solid Modeling software.
In late 1995 and early 1996, one new startup (SolidWorks) and one established vendor (Intergraph/Solid Edge) announced new CAD products. These were 3D systems which provided the benefits of the large expensive systems, but at a price point within reach of smaller companies. Almost overnight, even the smallest companies started to make the transition to 3D CAD because of these simple, powerful and affordable new products (Inventor was added to this mix a bit later).
These companies did not make the transition to 3D solid modeling because the existing suppliers tried to re-brand, re-configure, re-name, or re-market their existing products. They did not make the transition because the vendors or industry analysts or consultants tried to tell them the timing was right or that there was a great ROI.
They made the transition because disruptive technology was introduced in the form of two new products. These products were developed, configured and priced so they made sense for smaller companies.
Today, the PLM Market looks like the CAD industry of 1994. There are a few big vendors that have solutions built for large Aerospace and Automotive companies. These solutions have been pushed down to some suppliers. The vendors have tried unsuccessfully, like the CAD vendors before them, to re-package, re-brand and re-configure these solutions to fit into small businesses, but they have made minimal in-roads.
The bulk of smaller companies are getting by with a less than optimal, but affordable solution. In this case, Excel.
Large numbers of smaller companies will not make the transition to PLM until someone introduces truly disruptive PLM technology. The implementation of current solutions is largely limited to companies with a lot of money and a lot of skill (or enough money to hire a consultant with a lot of skill). Until products suited for companies with limited resources both in terms of money and skill are introduced, smaller companies will not embrace PLM.
Existing PLM products are simply too sophisticated, too complicated and too expensive for small to medium sized companies. When a simple, powerful and affordable solution becomes available, small companies will embrace it at the level that engineering companies embraced SolidWorks and Solid Edge in the mid-1990s.
4G:PLM from SolidPartners is a new PLM System developed and priced to provide a Simple, Powerful and Affordable solution for small and medium sized businesses.
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