April 2007: SMB Talking Points The Big PLM Sales Teams Hope You Never Hear

From 2007: A light-hearted look at PLM and Small Business

By Randall S. Newton
Editor-in-Chief, CADCAMNET

[Editor’s Note, 2007: The following is a commentary written to jump-start the conversation at COFES 2007, the Congress on the Future of Engineering Software, April 12-15, 2007 in Scottsdale, Arizona. Although CADCAMNet is no longer owned by Cyon Research, the host of COFES, we still offer the conference our highest recommendation; most of our staff will be in attendance.]
  • Article in bullet points.
(Like an ugly PowerPoint.)
Topic: Big PLM and Small-Medium Businesses (SMB’s)
Competitive pressure on SMB manufacturers are intense
… and g-r-o-w-i-n-g.
Health care $costs$ continue to rise in the US …
SMB’s feel the pain.
Little-known fact: Individuals can now buy health insurance for half of what it costs an employer
Unintended side-effect of federal regulations.

[Editor’s Note, 2010: Remember, this was written in 2007, before Obamacare was passed.]
(Bureaucrats: Stupid or canny? You decide.)

The savings are several $K person/year.

SMB manufacturers will leverage this …

like crazy.

Thousands of engineers will be forced to become contractors.

SMB’s will pay engineering contractors extra to buy their own health insurance…

… and save money at the same time.

(Competitive with foreign engineers? Another topic/another time.)

The typical SMB engineering organizational chart will

F  L  A  T  T  E  N

Bye-bye pyramid-as-org-chart …

… hello network-as-org-chart.

Meanwhile: PLM vendors are hot to trot with SMB’s.

Big growth market. Sales reps are drooling.

Fact: PLM Vendors serve BIG customers.

Industrial giants. “Planes, Trains and Automobiles” types.

Sophisticated IT infrastructures.

PLM consulting revenue on par with license revenue.

Good for companies with pyramidal org. charts.

Big IT. Big support staffs. Everything BIG BIG BIG.

One problem…

… SMB does not stand for Small-Medium Bigs.

SMB?s want smaller, simpler PLM …

… or no PLM at all.

If they FLATTEN their organizations…

… might as well FLATTEN the IT, too.

FLATTENED IT … isn?t that the Internet?

“On the server” becomes “on demand.”

SMB?s trust BANKS with their $money$…  an oursourcing of capital holding.

… they will trust SaaS PLM with their data… an outsourcing of IP holding?

Do MONOLITHIC PLM systems belong in FLATTENED SMB?s?

Ask your PLM vendor!