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    IBM Picks Up PLM Pace

    By
    eWEEK EDITORS
    -
    June 17, 2002
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      IBM is taking a fast-track approach to building share in the growing PLM market in a bid to gain leadership and stimulate stagnant sales. The Armonk, N.Y., company recently added product life-cycle management to the short list of products and services covered by its 18-month-old emerging business opportunities initiative.

      The move means PLM will receive top-priority management attention and will be treated as an entrepreneurial opportunity. Management goals and objectives will be based on the speed with which IBM can define and develop this market rather than short-term profitability, said Bruce Harreld, the companys head of strategy.

      PLM becomes the latest addition to the emerging business opportunities initiative under Harreld. Earlier and ongoing areas of focus include storage virtualization software, pervasive computing, autonomic computing and Linux.

      “In the past, weve been early in the identification of trends but poor at building business units around [new] ideas,” Harreld said. “Now were setting milestones and assigning top management leaders to these areas.”

      Under Ed Petrozelli, PLM solutions general manager, IBM is expanding its ISV partnerships, launching PLM pilot projects with large-enterprise customers and encouraging integration among key PLM software products using IBM tools such as its WebSphere application server and other middleware. The expanded partnership push means that IBM is moving beyond a longtime relationship in which it resells the Catia CAD product and Enovia product data management software from Dassault Systemes S.A., of Suresnes, France.

      IBM has signed on PLM partners such as collaborative product development software vendor MatrixOne Inc., of Westford, Mass.; supply chain management ISV i2 Technologies Inc., of Dallas; and SAP AG, of Walldorf, Germany, whose materials planning applications tie into PLM solutions.

      “IBM is looking to break out of the Dassault arena, where their PLM brand was tied to a CAD solution,” said Susan McRae, vice president of business development at MatrixOne. “By establishing partnerships with other PLM providers, IBM will be able to expand its current role in this market.”

      Its not surprising that IBM is attempting to put its PLM market position on the fast track. Spending on PLM products and services is expected to grow from $8.5 billion last year to about $15 billion by 2005, according to market researcher Daratech Inc., of Cambridge, Mass. The growing market has also attracted IBM competitors and rivals of its PLM partners. Electronic Data Systems Corp. in March, for example, made strategic partnerships with CAD and PLM software vendors, including Autodesk Inc. and SeeBeyond Technology Corp. Similarly, SAP competitor PeopleSoft Inc. last month announced a PLM partnership with Agile Software Corp.

      To bolster its PLM business, IBM has also launched a series of PLM pilot projects with large enterprises. The pilot projects, said IBMs Petrozelli, are intended to identify core, end-to-end PLM business processes where IBM and partner software matches those processes. IBM said it expects most of the projects to be completed by years end, with integrated PLM product suites from IBM and its partners to begin rolling out early next year.

      One large enterprise that has signed on as a pilot site is Bombardier Aerospace, a $12 billion manufacturing division of Bombardier Inc., of Montreal. After 10 years of growth through acquisition, the division has embarked on a major re-engineering effort intended to speed airplane and other aerospace products to market by integrating processes such as product creation and development, materials planning, and manufacturing, said Nabil Saad, general director of enterprise planning. To do that, Bombardier needs to integrate stovepipe systems such as its Catia CAD, SAP materials planning and shop floor systems, and Enovia product data management applications.

      Saad said Bombardier signed on to have IBM help it define the project because “IBM has the know-how and hardware and software technology that can support the integration that this will require. And they can provide support for the [process] mapping.”

      IBMs fast-track approach to the PLM market, where the company is attempting to quickly grab a leading role as an integration expert and a definer of core processes, represents a significant change over its approach to the last big enterprise software market explosion: the booming ERP (enterprise resource planning) run-up of the late 1980s and early 1990s. Then, after failing to compete directly with SAP and others as an ERP software developer, IBM scrambled to find a role in the market as an integrator and a service provider.

      The companys decision to manage PLM out of its emerging business opportunities initiative has cut some red tape, said MatrixOnes McRae. “This is as quick as Ive ever seen them react, and Ive been impressed with the people theyve put in place to push PLM,” McRae said.

      But, said McRae, its not as if even the new IBM is always able to move at the speed of the market. “Its still IBM,” she said. “It remains to be seen if they can turn that battleship as quickly as they need to.”

      eWEEK EDITORS
      eWeek editors publish top thought leaders and leading experts in emerging technology across a wide variety of Enterprise B2B sectors. Our focus is providing actionable information for today’s technology decision makers.

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