How SAP Plans To Beat Oracle In PLM Software Market - InformationWeek

InformationWeek is part of the Informa Tech Division of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them.Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.

IoT
IoT
Software // Enterprise Applications

How SAP Plans To Beat Oracle In PLM Software Market

SAP argues that businesses interested in product-lifecycle management software don't have the time to wait for Oracle to get its integration story together.

The term "product-lifecycle management software" doesn't exactly roll off the tongue. But SAP and Oracle, staunch competitors and the two largest vendors of business applications, are in a race to gain more share of this growing market.

SAP on Wednesday laid out its roadmap for product lifecycle management (PLM) software, starting with plans to simplify its PLM user interface next year so that more types of people within a company can use it. SAP's three-year plan for internal development improvements to PLM is partly in response to Oracle's recent acquisition of Agile for $495 million.

SAP had a leg up on Agile in PLM market share last year, as it's been able to sell into existing customers in manufacturing, consumer goods, and other industries. But now that Oracle has Agile, it's likely going to do the same thing with its accounts for J.D. Edwards, PeopleSoft, Siebel, and other acquired applications.

SAP argues that businesses interested in PLM don't have the time to wait for Oracle to get its integration story together. "PLM, supply chain management, enterprise resource planning, and customer-relationship management all need to work together as one solution focused on the business process instead of support a single department," said Hans Thalbauer, SAP's head of Solution Management PLM. "This deep integration we see as a key differentiator. Ours isn't a silo approach; it's an end-to-end business approach."

There are several factors that have companies investing more in PLM, according to SAP. As businesses become more global, they require a solid system for managing collaboration on product development from various operations and partners in different regions throughout the world. PLM can offer a number of features related to access rights for dealing with regions where intellectual property protection remains a concern, SAP said.

Increasingly, more products are tied to services (SAP points to Apple's iPod and iTunes as an example), requiring involvement in product development from more people within company beyond engineering. It cites consumer goods company Kimberly-Clark as an example of customer expanding SAP PLM to more people within its organization.

"PLM is no longer just software that manages your drawings or billing materials," Thalbauer said. "PLM has become a key backbone for a company, and a way to collect ideas from around the world; to be able to start to bundle services around a product and bring this new kind of product to market, and follow up when the product is on the market to serve customer needs."

Wishful vendor thinking or reality? This much is clear: PLM is big and rapidly growing, despite the niche feel of the concept. In an April report, research and consulting firm CIMdata Inc. said that the worldwide PLM market experienced a "stronger than expected" year in 2006, growing 10.4% to $20.1 billion. CIMdata characterizes PLM as "not just a set of technologies, but a strategic business approach," and estimates the market to hit $30 billion by 2011. Among the players are the traditional PLM vendors such as Autodesk, Dassault, Cadence, and UGS, as well as IBM, SAP, Agile, and Oracle.

The interface SAP develops for PLM in 2008 will be designed to require less training for users so that non-techies will have easier access. It's planning a PLM enhancement package for 2009 that will offer management of all product-specific information such as ideas, design, requirements, variant configuration and maintenance structure in an integrated system that allows data to flow among various departments.

Another enhancement package, set for 2010, will offer the assimilation of "real-world" information, letting businesses integrate information on product plans with digital manufacturing tools, and incorporate product information collected from RFID tags, bar codes and sensors.

We welcome your comments on this topic on our social media channels, or [contact us directly] with questions about the site.
Comment  | 
Print  | 
More Insights
InformationWeek Is Getting an Upgrade!

Find out more about our plans to improve the look, functionality, and performance of the InformationWeek site in the coming months.

News
How CIO Roles Will Change: The Future of Work
Jessica Davis, Senior Editor, Enterprise Apps,  7/1/2021
Commentary
A Strategy to Aid Underserved Communities and Fill Tech Jobs
Joao-Pierre S. Ruth, Senior Writer,  7/9/2021
Slideshows
10 Ways AI and ML Are Evolving
Lisa Morgan, Freelance Writer,  6/28/2021
White Papers
Register for InformationWeek Newsletters
Video
Current Issue
Slideshows
Flash Poll