Manufacturing Executive - January/February 2009 - (Page 28) [ SPECIAL REPORT ] When Helmuth Ludwig was brought in as EDS was in president of Siemens PLM Software in sumout of the mer 2007, he shifted the focus toward the softGoulden, C ware sell, which has a very different licensing Car. “Whe structure and maintenance and service busithe Solid E ness model than hardware. good thing giant assimilate this independent American Part of the exercise was to create account proven it is entity amid cultural differences specifically maps to find out how both organizations were purchase b related to management style? More important, addressing customers and where the crossally is. The what was this digital factory vision that Anton sell opportunity would be. “We would talk own it and S. Huber, CEO of Siemens Industry Automaabout the businesses and which customers How wel tion Division, spoke so passionately about? were important, and at the end of the meeting portfolios, Explaining the thinking behind Siemens’ Anton Huber the Siemens PLM guy would write down two “If you c CEO of Siemens Industry Automation Division move, Huber says the biggest pain point for customers he believed the automation manufacturers is the ability to manufacture side could help, and the automation Ther products in a timely and cost-effective manner. guy would write down two customers of in Tying PLM and simulation tools together with where Siemens PLM could help,” Ludapproach; rather, it could directly relate to money and market with industrial automation control architectures — which is the corwig says. opportunity. In addition to helping existing cusnerstone of the digital factory concept — will let manufacturers —B “Most automation companies are not appealed unify virtual and physical domains and get a product to market in tomers, the new combination in a financial position as strong asto new customers. Volkswagen Group had Siemens to do this,” says Joe Barkai, practice exactly ho half the usual time, he says. director of product lifecycle strategiesPLM offerings and Acquiring UGS was critical, Huber says, as it not only benchmarked a number of at IDC Manufacturing where thin Insights, a research firm. And even if theyfitting the money, time doing added the PLM and modeling technology required to marry had identified Teamcenter as have with the “the immediate question is, who would they acquire? There quested an the virtual with reality, but it also brought in software engicompany’s long-term strategy. UGS’ financial are not many PLM companies left,” question at the time, neering expertise, thereby equipping Siemens with all the stability, however, was in he says. But the p That gives Siemens aRiedel, Volkswagen’s director of it sharpen no pieces it needed to connect the digital factory dots. said Oliver tremendous advantage if indeed made the right decision to acquire UGS rather than simply tion is com “We think we have all of the ingredients to [deliver] this to process integration and information manageforge PLM ment, during a presentation at Siemens PLM on last steerin partnerships. Still, there is a technology issue the industry the fastest,” Huber says. “And the competition Software’s industry analyst event last May. post-merge the table. Specifically, most manufacturers have a plethora of will follow.” “We PLCs from The Siemens acquisition sealed thePLM approach forma a variety of vendors. The Siemens deal. To some extent, he is being proven right. The first sign “Siemens had been Siemens controllers into fined who i will tightly integrate and fine-tune a strategic partner in came in December 2007, when Rockwell Automation and manufacturing,” Riedel said. “And it was for the digital factory concept. But what does that meantheira list, and re Delmia, a division of Dassault Systèmes, outlined a technolacquisition of UGS that swayed us toward makfactory floor with a mix of Siemens, Rockwell, Schneider says. “We ogy partnership based on an object-oriented database that companies Electric, or GE Fanucing the Teamcenter decision.” controllers? provides a bidirectional information exchange between a digiWhile there Siemens says. “The While ge No problem, were mixed reactal design and the control architecture. tions fromis to keep all of the products gether was objective customers when the acBoth Rockwell and Dassault have said quisition was announced, “all of plicated by open,” says Chuck Grindstaff, executive the relationship is not exclusive and our customers were positive about ance rules vice president of products for Siemens they will seek out similar partnerships. one aspect for sure, that UGS “This was SIEMENS AND UGS: PLM Software. “There is no push to be The non-exclusivity that Rockwell would not be in a bad position finew compa A PICTURE OF HEALTH proprietary in connection points.” touts is much different from Siemens’ nancially,” Carrelli says. all of these Since Siemens’ acquisition of UGS in May 2007, the But will the experience be the same? approach, which is centered on a tightly The next question became: In additi company has been growing at a healthy clip — “They assured me they will have conintegrated turnkey plan. It’s an approach from employees, to customers, to revenue. What will this mean in the future? completely nections and interfaces to thought that could either propel Siemens into the Many customers other control- technolo in In the most recent 12 months (July 2007 lers,” says Jim Caie, vice president of to remain spotlight as the premier digital factory Siemens would slow down the softthrough June 2008): consulting at ARC Advisory Group. that provider or limit it to new deployments ware business, Ludwig admits. But “But the co ● NX license revenue grew 13%. they won’t be had the integrated.” the depart amenable to a soup-to-nuts solution. it has actually as tightlyopposite ef● Tecnomatix (Mechanical) license revenue What the actual of the synchroIt’s not clear at this point whether fect. The delivery extent of integration ecutives, m grew 28%. turns out to be is difficult to assess at Siemens’ acquisition of UGS was ingenous technology is a perfect ex“Our con ● Teamcenter total revenue grew 15%. this time, Caie says, because Siemens strong cul niously daring and deserving of kudos ample. “We have put more money ● New versions of NX, Teamcenter, Tecnomatix, has R&D, and that made to do this. says. “Eve for its pioneering effort or a radical risk intoonly outlined a strategyit possiVelocity product lines were delivered. Siemens describes that strategy, dubbedstrongly ab ble to speed up the release [of the that could prove to be a costly mis● Customers grew from 47,000 to 51,000. technology],” Ludwig says. nicated as Project Archimedes, as an integration vetake in judgment. The fact is, no other ● Seats grew from 4.3 million to 5.5 million. Indeed, some say the UGS is we hicle designed to moveSiemens and Sie- would d automation vendor has followed in breathing new life into UGS, togetherheld town ● Teamcenter achieved another leadership milemens technology communities and Siemens’ footsteps and acquired a PLM they compare the atmosphere veys to ge stone with delivery of 4 million seats, continuing under a common vision of uniting PLM, company. But observers say that may to make it the most used PDM in the world. with the period when EDS owned verbal com automation systems, and motion control. not necessarily indicate it’s the wrong UGS prior to spinning it out to priThe tow Source: Siemens PLM Software vate equity firms. “We felt when otal. One in Manufacturing M WOR ERGER KING ? THIS E “ WE THINK WE HAVE ALL OF THE INGREDIENTS TO [DELIVER THE DIGITAL FACTORY] TO THE INDUSTRY THE FASTEST. “ report INSIDE LOOK card Executive JAN/FEB-09 October Photos courtesy: Siemens
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