Big PLM Gets Bigger as UGS and Dassault Systems Show Growth
Thursday, August 05, 2004
Kevin O'Marah
While many other categories of enterprise software have struggled in recent months, Product Lifecycle Management
(PLM) continues to go strong as seen in the traditional PLM leaders,
Dassault and UGS, each posting strong recent quarters with double-digit growth in non-Computer-Aided Design (CAD) PLM applications.
The Bottom Line:
AMR Research’s forecast of a 14% Compound Annual Growth Rate (CAGR) for the next five years in non-CAD PLM looks well on track, validating the persistent need for software tools that accelerate growth
through product innovation. But with demand comes supply problems in the form of a shortage of qualified help.
What It Means:
Prospective customers should be increasingly confident that the software is functionally maturing in this sector as UGS’s
Teamcenter has been steadily tightened and unified, and SmartTeam from Dassault continues to sell well. Both vendors are well capitalized--$1B companies with thousands of global users.
But trouble is on the horizon. PLM project leads will soon find trained consulting resources hard to find. AMR
Research’s field research on PLM confirms that services needed to convert and migrate data, set up product
structures, and define workflows can consume three to five times the budget allocated for software. Large projects,
especially for Product Data Management (PDM) foundations, require many skilled resources which may be
unavailable 12 months from now.
Recommendations:
Identify and begin to secure commitments on key consulting resources early in the process of selecting preferred PLM vendors. Big outfits like
IBM and Accenture can be complemented by specialists like Integware
that are deep and experienced. With the big guys, watch for individual qualifications; with the small guys, book early.
Copyright © 2004 AMR Research, Inc.