One of the most challenging things a software company can do is re-platform its underpinning technology. It is a thankless job, most customers don't appreciate the long term benefits and certainly don't want the near term sacrifices of less incremental functionality. Similarly, prospective customers worry that they are getting in at the first iteration of a product which is often associated with performance risk.
History justifies the trepidation. Remember SSA and their re-platform efforts in the 1990's? Their BPCS product was the market leader in ERP and poised to flourish in the Y2K buying spree. The company's technical leadership, however, became enamored with object oriented programming and object databases, still very nascent at the time. The motives were good - the promise, nirvana really, of giving customers tremendous flexibility in customizing the applications while maintaining the ability to take regular upgrades. The actual product, several years late, was a performance nightmare and SSA lost their market lead to the likes of SAP and Oracle.
A decade later those two eventual leaders each went through their own platform pain - one in an attempt to modernize its monolithic code base onto a service oriented architecture (SAP, NetWeaver) and the other in order to bring an acquired portfolio together (Oracle, Fusion). While not without scars, these efforts were far more successful than the SSA debacle.
A hardware company that certainly knows how to take product risk is Apple. The recent passing of Steve Jobs has led to a flood of articles about his history and legacy. One thing that seems to be repeated in these articles is the notion that Mr. Jobs' evangelical leadership style created what Apple insiders called a "reality distortion field" - a culture inside of the company that tended to distort some of the market facts under the guiding principle that its CEO could not be wrong. Fortunately, the leadership team at Apple seems to have developed some coping mechanisms that prevented this phenomenon from effecting market success.
The Dassault Context
I was thinking of these two concepts - the difficulty of platform change and reality distortion - while I attended the recent Dassault Systemes user conference.
The company's big platform bet has been V6 with Enovia as the platform center. Both specific design tools - Catia, Delmia, and Simulia - and broad collaboration tools - 3DVia, Exalead, and 3DSwYm - are connected to that platform. Enovia product management presented data showing 800 customers committed to V6 although they did not share how many were live. Although not confirmed by DS, the adoption of V6 has been slower than originally planned. And there were certainly several high profile PLM selections in traditional industry segments that did not go Dassault's way and anecdotal evidence suggests that concerns over V6 performance factored into the decisions.
As to reality distortion - it would be unfair to compare any CEO to Steve Jobs, but I am always impressed by the courage of (Dassault CEO) Bernard Charles' vision as well as his enthusiasm and energy. These attributes were in full display at the conference in Mr. Charles' address to the audience and in his willingness to walk the exhibit floor and engage the DS partner community. However, I do get the sense that his sheer will creates some reality distortion amongst his senior management when they have to come to grips with market activity and the coping mechanisms that Apple developed are not evident at Dassault.
The Dassault Future
There is no shortage of irony when a company has a reality distortion issue and their vision is around 'lifelike experiences'. All that said, Mr. Charles's belief that the geometric model is at the center of better decision making, collaboration, and product management is one that buyers should listen to. This concept is why PLM specialists will remain ahead of the ERP vendors wanting a piece of their historic markets. Bernard Charles gets this completely and is willing to commit resources to achieving the long term product objectives represented in delivering lifelike experiences.
As to the platform issue, all evidence points to situation that has fully stabilized. Early adopters presenting at the conference provided case studies that were both reassuring as to system performance and encouraging as to harvesting the benefits of a unified platform. IDC Manufacturing Insights believes there a still a number of questions to be answered including:
- Will the pursuit of industry segments outside of heavy manufacturing be well conceived? At the conference we heard too many examples that involved having to 'uncomplicate' the existing product. You can't give an Aerospace interface to a fashion retailer. Despite the challenge, those same customers were very happy with the result which is promising.
- Can Dassault play in broader collaboration and information management markets? 3DVia makes sense, but big data and social business products may be outside of their core competency. Not only are the products very different, they are sold to different buyers by very different account managers at very different prices. We might suggest that they incorporate keynote presenting partner Microsoft in their thinking, working some of these products within the confines of SharePoint.
- Will the company forget its roots in heavy industry? Despite the attractiveness of new segments and some tough losses in automotive, DS still has a very compelling system engineering story and traditional PLM buyers understand and appreciate the value of lifelike capabilities more than others.
These are addressable questions and IDC Manufacturing Insights is confident Dassault will tackle them positively.
If you are a company looking for a modern PLM platform, Dassault has made the investments and endured the pain of platform transition that makes it a default short list candidate. If you are an existing Dassault customer, it is safe to wade into the V6 waters and likely to be productive based on the case studies we saw at the conference. One note, most the reference customers used DS services in a lead integrator position and that continues to be a recommended approach until implementations become more normalized and external consulting partners more experienced.
Overall, Dassault has shown good progress against a compelling vision and continues to deserve its status as a PLM leader.