Windchill Executive Summary
Contents Abstract 3 I. Introduction 4 1. Innovation Principles background 4 2. The purpose I selected this topic 6 3. PTC Background 6 II. PTC Current Business Strategy 7 1. Strategic Goals 7 2. Current Strategy 8 III. Innovation capability analysis for PTC 9 1. Analysis for current platform and service 9 2. Innovation brought form platform and services 10 3. Issues on current platform and service 11 IV. Proposed Innovation Opportunities 12 V. Potential Risk of Proposal 13 VI. Conclusion 13 VII. Appendix 14
Abstract
This essay is an analysis and recommendation for innovation capabilities of PTC (Parametric Technology Corporation), which is a software company I served for previous 3 years. All the analysis …show more content…
was based on the Six “Enduring” Principles created by professor Michael A. Cusumano from MIT Sloan School. I made a thorough analysis of PTC current platform and services, which brought many advantages for its innovation, and give some proposals to its platform and services to better meet its sustainable innovation goals.
I. Introduction
1. Innovation Principles background
Today is an age of innovation and commoditization. The innovation and renewal are essential factors for companies on all industries to survive and thrive on the fierce competition since it is difficult to get competition advantages by doing the same thing or with the same products. But, only is the production innovation enough? How to find an effective way to keep sustainable innovation? The professor Michael A. Cusumano from MIT Sloan School brought us six “Enduring” principles on sustainable innovations, which focus on platform and services rather than product. On his book “Stay Power”, the six principles (see Appendix 1.) was descripted as below:
Principle 1: Platforms, Not Just Products
In this principle, two types of platform was defined, one is the internal product platform, which means a set of common components or modules around which an organization can create a family of related products or service. Another is external industry platform, which is the network that can bring together different platform owner to create new products or services. The product platform is useful to develop new product and services by utilizing existing knowledge and technology and industry-wide platform is useful to leverage a global ecosystem and generate network effects.
Principle 2: Services, Not Just Products
Here the service means transformed standardized products into more tailored service-like offerings as well as elevate product to become new service-delivery platforms such as Google search, Apple iTunes or some staff like that. It will generate more revenue or profits from maintenance and personalized services than from standardized products.
Principle 3: Capabilities, Not Just Strategy
Base on the platform ecosystem (see Appendix 2.), which come form combination of platform, complements and network effects, the value shift from stand-alone products to industry-wide platforms and different types of services, which could bring deep capabilities in science and technology. They are core factors for companies to discover core competency.
Principle 4: Pull, Don’t Just Push
Strong network effects bring the platform will attract more costumers’ eyes, which so called pull process.
Principle 5: Scope, Not Just Scale
With the development of the external platform, the scope of the platform covered should be widened and maximized.
Principle 6: Flexibility, Not Just Efficiency
The innovation with the platform and service will take flexibility into account rather than efficiency, because the transportability made the system could easy to reuse. Which is important to save cost.
2. The purpose I selected this topic
There are two reasons to select this topic. This lecture focuses on the strategic problems faced by firms on high-tech industries, which I have worked in for 6 years as a software engineer. I am very familiar and interested in them. What’s more, my last company PTC has been working on building platform and services since the establishment. Indeed it got big success and innovation advantages from its platform and service, but still some aspects need to be improved. So, base on the six enduring principles, I tried to analysis the platform and services of PTC and give some proposal to it.
3. PTC Background
PTC is one of the world’s largest and fastest-growing technology companies, which was founded in 1885 in Needham, MA, USA. It provides the solutions for Product Lifecycle Management (PLM), Computer Aided Design (CAD), Application Lifecycle Management (ALM), Supply Chain Management (SCM) and service Lifecycle Management (SLM) to aggregate, analyze, and deploy product information to drive the strategy and dynamic decision-making processes. It enables manufacturers to achieve maximum value from their product strategies with software and services designed to optimize key business processes throughout the entire product lifecycle–from conception and design to sourcing and service.
Today, PTC employs over 6,000 professionals serving more than 27,000 customers worldwide to help them design and service products in rapidly-evolving, globally distributed manufacturing industries, including industrial equipment, automotive, high tech and electronics, aerospace and defense, retail, consumer, and medical devices. By partnering with PTC, they cultivate and exploit their best product ideas from concept and engineering through delivery and service.
II. PTC Current Business Strategy
1. Strategic Goals
Expansion
To increase its solutions scope, PTC did lots of acquisitions during these years. It wants to develop a high quality and professional platform as well as delivers best services to the customers. The acquisitions will greatly enhance PTC's existing portfolio of all kind of solutions such as PLM, SLM, which includes robust capabilities in the areas of warranty and contract management, service parts definition, and technical information - including mobile delivery.
Sustainable Innovation
PTC invests a lot in its own research and software development. They have over 200 patents, all of which were their engineers’ own inventions. PTC also has its own research facility where it aims to find new technologies, feats of engineering and ways to revolutionize the tire industry.
Green and sustainability
PTC is dedicated to identifying green initiatives and opportunities for improvement. They look for efficiency gains throughout all functions of the company and have implemented savings from energy savings (lights, technology usage, and travel reductions) to managing waste throughout our facilities.
2. Current Strategy
Development strategy
As leader of the CAD, PLM solutions providers, PTC pursuits do best on the solution integration and service customization. Based on the concept of “People Orientation, Sustainable Development”, and closely focusing on the main businesses including PLM, ALM, CAD, the company continues to expand the corporate scale and enhance the corporate performances in order to build the most valuable and competitive domestic IT solutions provider which can operate firmly, develop smoothly and possess the advanced technology by its core technology advantages in PLM.
The Technical Development and Innovation Plan
The PTC is devoted to technical development and innovation and focuses on development and Optimizations its product and service all the time. At present, based on the introduced technology on platform development, which will keep stay ahead domestically. Meanwhile, the company will continue to strengthen the application research on the new technologies, equipment, and materials, and research and promote the information technology application in the traditional industries and technologies. The company will further strengthen the technical cooperation and exchanges with colleges and universities and research units as well as increase the research and development input to guarantee the sustainability of the technical development and innovation.
III. Innovation capability analysis for PTC
1. Analysis for current platform and service
Platform
The PTC has a strong internal platform, just like the Appendix 3 show, it compile the product and solutions together smoothly.
The product could help handle entire manufacture process from design to delivery. The Creo is an award-winning suite of design solutions focus on 2D and 3D. Windchill is a lifecycle-controlled suite, which helps users eliminate cost, accelerates overall development time. Arbortext is an end-to-end dynamic publishing solution streamlines to help users create, manage and publish technical information. Mathcad is a calculation tool could help users solve, analyze, document and share calculations easily. Based on all these professional products, PTC provides different portfolio solutions to help customers to address challenges across the product lifecycle. We could find two kinds of solutions from the appendix 3, the customization solution, and uniform solution. The customization solutions are defined from three different categories: by role, by industry and by business need. The customers could select any one base on their roles, such as management, sales or base on their industry, including Aerospace, consumer product or depends on their business needs. The purpose for this customization solution is to position the users requirements accurately and give target services to better meet users needs. The uniform solutions deliver the standards on PLM, ALM, and CAD domain, which are supposed to create a platform with simple structure, nice commonality, strong expansibility, also has use value in secondary development and
application.
Service
PTC provides different kinds of services including Technical support, consulting, maintenance, and training. Its technical support delivers a revolutionary and comprehensive support experience designed to increase users’ productivity by reducing their effort in getting issues resolved and questions answered. Consulting helps users to know the challenge of balancing process transformation with off-the-shelf software and provide best practices in program strategy, planning and alignment. PTC University delivers the tools and training that enable users to use PTC technology effectively.
2. Innovation brought form platform and services
First mover on Process-Based Solutions
PTC was the first mover on process-based solutions and achieved the most successful PLM implementations by its innovation. It benefit so much from its platform, since the platform identified the most important opportunities for process improvement first and focus on moving those toward industry best practice. [3] What’s more, platform helped PTC Implement changes in ways that minimize operational disruption and maximize short and longer-term value. Belongs to its platform, it created efficient product development system, see appendix 4.
Staying power on product improvement
As the development of platform, its products and solutions underwent a lot of changes and optimizations. This process required software that has the necessary capabilities build in; it also required implementation teams with deep innovation of the best ways to configure build-in capabilities to optimize essential business processed. It is a good cycle for sustainable innovation on which the company success depends.
3. Issues on current platform and service
Not versatility on external Platform
The products of PTC delivered are so professional as to some of them have became the standards throughout the professional sphere, such as its CAD applications. However, compare to its product, the solutions are not so versatility. For example, some data from upstream system including design, record are not compatible when export to others companies’ system. It is not build a standard platform on the industry, which has some constrain on the innovation.
Not flexible on service
The current service systems for Technical support are horizontal ones, which made the response undertaking layer by layer. It is time consuming and hard to execute.
IV. Proposed Innovation Opportunities
Service Architecture Reorganization
According to the customer's request for defect analysis, process refinement, the vertical service distribution will figure out the solutions on very short time. The organization of the service should be changed to vertical one which is divide different teams based on different solutions, they response for the special customer directly. Then the transition of the old service systems with one encompassing service system could maximize the service scope as well as improve the service quality.
Strong industry platform
So far, PTC has corporation with Microsoft to try to embed its solutions into its SharePoint platform to build up the external platform. It delivered some solutions developed on SharePoint such as WWP, Requirement Link. However, it's a long way to build up the whole industry platform, cooperation with mature platform is just an initial step. Two aspects could be emphasized on to develop the strong industry platform. The first one is to continue release the solutions relied on the famous platform such as SAP, SharePoint. Another one is to build up its own brand platform, since the PTC has already achieved to build up the industry standard for its CAD product as well as become the first mover on integration of PLM solutions, so it is easy to promote its service and others solutions based on its good reputation and technology capabilities.
V. Potential Risk of Proposal
Monetary Investment
While the PTC is costly by itself; we think the cooperation with some big platform such as Microsoft will be the more serious monetary issue. This change will mean an increase in cost on development.
HR restructure
Restructure of the service will cause the reorganization of the human resource as well as leadership team. It dampens the mood of some employees and potentially put the brakes on the changes. As this recommendation includes major changes in processes employees are used to, it is possible that PTC will see workers ill at ease with new structure. However, we are confident that all employees will see that these upgrades will make workload less complicated across all borders.
VI. Conclusion
PTC is doing remarkably well not just in USA, but also across the world. It is time for them to ally their business strategy with some strong platform to enhance capabilities and improve efficiencies internally base on six enduring principles. Because PTC external platform is going very well, we believe this investment is more than beneficial for them to carry out their future potential of improving production processes, sustainable innovation and quality of their platform and really put a gold stamp on PLM domain
VII. Appendix
Appendix 1. Six “Enduring” Principles
Appendix 2. Platform Ecosystem
Appendix 3. Platform and Service Architecture for PTC
Appendix 4. Product Development System
--------------------------------------------
[ 1 ]. Lecture PPT “New Strategic Principles: Platforms & Services”, Michael A. Cusumano
[ 2 ]. Lecture PPT “New Strategic Principles: Platforms & Services”, Michael A. Cusumano
[ 3 ]. PTC official website: http://www.ptc.com/company/
[ 4 ]. PTC official website: http://www.ptc.com/ product-development-system/
[ 5 ]. “The Business of Software: What Every Manager, Programmer, and Entrepreneur Must Know to Thrive and Survive in Good Times and Bad” [2004] Michael A. Cusumano.
Abstract
This essay is an analysis and recommendation for innovation capabilities of PTC (Parametric Technology Corporation), which is a software company I served for previous 3 years. All the analysis …show more content…
was based on the Six “Enduring” Principles created by professor Michael A. Cusumano from MIT Sloan School. I made a thorough analysis of PTC current platform and services, which brought many advantages for its innovation, and give some proposals to its platform and services to better meet its sustainable innovation goals.
I. Introduction
1. Innovation Principles background
Today is an age of innovation and commoditization. The innovation and renewal are essential factors for companies on all industries to survive and thrive on the fierce competition since it is difficult to get competition advantages by doing the same thing or with the same products. But, only is the production innovation enough? How to find an effective way to keep sustainable innovation? The professor Michael A. Cusumano from MIT Sloan School brought us six “Enduring” principles on sustainable innovations, which focus on platform and services rather than product. On his book “Stay Power”, the six principles (see Appendix 1.) was descripted as below:
Principle 1: Platforms, Not Just Products
In this principle, two types of platform was defined, one is the internal product platform, which means a set of common components or modules around which an organization can create a family of related products or service. Another is external industry platform, which is the network that can bring together different platform owner to create new products or services. The product platform is useful to develop new product and services by utilizing existing knowledge and technology and industry-wide platform is useful to leverage a global ecosystem and generate network effects.
Principle 2: Services, Not Just Products
Here the service means transformed standardized products into more tailored service-like offerings as well as elevate product to become new service-delivery platforms such as Google search, Apple iTunes or some staff like that. It will generate more revenue or profits from maintenance and personalized services than from standardized products.
Principle 3: Capabilities, Not Just Strategy
Base on the platform ecosystem (see Appendix 2.), which come form combination of platform, complements and network effects, the value shift from stand-alone products to industry-wide platforms and different types of services, which could bring deep capabilities in science and technology. They are core factors for companies to discover core competency.
Principle 4: Pull, Don’t Just Push
Strong network effects bring the platform will attract more costumers’ eyes, which so called pull process.
Principle 5: Scope, Not Just Scale
With the development of the external platform, the scope of the platform covered should be widened and maximized.
Principle 6: Flexibility, Not Just Efficiency
The innovation with the platform and service will take flexibility into account rather than efficiency, because the transportability made the system could easy to reuse. Which is important to save cost.
2. The purpose I selected this topic
There are two reasons to select this topic. This lecture focuses on the strategic problems faced by firms on high-tech industries, which I have worked in for 6 years as a software engineer. I am very familiar and interested in them. What’s more, my last company PTC has been working on building platform and services since the establishment. Indeed it got big success and innovation advantages from its platform and service, but still some aspects need to be improved. So, base on the six enduring principles, I tried to analysis the platform and services of PTC and give some proposal to it.
3. PTC Background
PTC is one of the world’s largest and fastest-growing technology companies, which was founded in 1885 in Needham, MA, USA. It provides the solutions for Product Lifecycle Management (PLM), Computer Aided Design (CAD), Application Lifecycle Management (ALM), Supply Chain Management (SCM) and service Lifecycle Management (SLM) to aggregate, analyze, and deploy product information to drive the strategy and dynamic decision-making processes. It enables manufacturers to achieve maximum value from their product strategies with software and services designed to optimize key business processes throughout the entire product lifecycle–from conception and design to sourcing and service.
Today, PTC employs over 6,000 professionals serving more than 27,000 customers worldwide to help them design and service products in rapidly-evolving, globally distributed manufacturing industries, including industrial equipment, automotive, high tech and electronics, aerospace and defense, retail, consumer, and medical devices. By partnering with PTC, they cultivate and exploit their best product ideas from concept and engineering through delivery and service.
II. PTC Current Business Strategy
1. Strategic Goals
Expansion
To increase its solutions scope, PTC did lots of acquisitions during these years. It wants to develop a high quality and professional platform as well as delivers best services to the customers. The acquisitions will greatly enhance PTC's existing portfolio of all kind of solutions such as PLM, SLM, which includes robust capabilities in the areas of warranty and contract management, service parts definition, and technical information - including mobile delivery.
Sustainable Innovation
PTC invests a lot in its own research and software development. They have over 200 patents, all of which were their engineers’ own inventions. PTC also has its own research facility where it aims to find new technologies, feats of engineering and ways to revolutionize the tire industry.
Green and sustainability
PTC is dedicated to identifying green initiatives and opportunities for improvement. They look for efficiency gains throughout all functions of the company and have implemented savings from energy savings (lights, technology usage, and travel reductions) to managing waste throughout our facilities.
2. Current Strategy
Development strategy
As leader of the CAD, PLM solutions providers, PTC pursuits do best on the solution integration and service customization. Based on the concept of “People Orientation, Sustainable Development”, and closely focusing on the main businesses including PLM, ALM, CAD, the company continues to expand the corporate scale and enhance the corporate performances in order to build the most valuable and competitive domestic IT solutions provider which can operate firmly, develop smoothly and possess the advanced technology by its core technology advantages in PLM.
The Technical Development and Innovation Plan
The PTC is devoted to technical development and innovation and focuses on development and Optimizations its product and service all the time. At present, based on the introduced technology on platform development, which will keep stay ahead domestically. Meanwhile, the company will continue to strengthen the application research on the new technologies, equipment, and materials, and research and promote the information technology application in the traditional industries and technologies. The company will further strengthen the technical cooperation and exchanges with colleges and universities and research units as well as increase the research and development input to guarantee the sustainability of the technical development and innovation.
III. Innovation capability analysis for PTC
1. Analysis for current platform and service
Platform
The PTC has a strong internal platform, just like the Appendix 3 show, it compile the product and solutions together smoothly.
The product could help handle entire manufacture process from design to delivery. The Creo is an award-winning suite of design solutions focus on 2D and 3D. Windchill is a lifecycle-controlled suite, which helps users eliminate cost, accelerates overall development time. Arbortext is an end-to-end dynamic publishing solution streamlines to help users create, manage and publish technical information. Mathcad is a calculation tool could help users solve, analyze, document and share calculations easily. Based on all these professional products, PTC provides different portfolio solutions to help customers to address challenges across the product lifecycle. We could find two kinds of solutions from the appendix 3, the customization solution, and uniform solution. The customization solutions are defined from three different categories: by role, by industry and by business need. The customers could select any one base on their roles, such as management, sales or base on their industry, including Aerospace, consumer product or depends on their business needs. The purpose for this customization solution is to position the users requirements accurately and give target services to better meet users needs. The uniform solutions deliver the standards on PLM, ALM, and CAD domain, which are supposed to create a platform with simple structure, nice commonality, strong expansibility, also has use value in secondary development and
application.
Service
PTC provides different kinds of services including Technical support, consulting, maintenance, and training. Its technical support delivers a revolutionary and comprehensive support experience designed to increase users’ productivity by reducing their effort in getting issues resolved and questions answered. Consulting helps users to know the challenge of balancing process transformation with off-the-shelf software and provide best practices in program strategy, planning and alignment. PTC University delivers the tools and training that enable users to use PTC technology effectively.
2. Innovation brought form platform and services
First mover on Process-Based Solutions
PTC was the first mover on process-based solutions and achieved the most successful PLM implementations by its innovation. It benefit so much from its platform, since the platform identified the most important opportunities for process improvement first and focus on moving those toward industry best practice. [3] What’s more, platform helped PTC Implement changes in ways that minimize operational disruption and maximize short and longer-term value. Belongs to its platform, it created efficient product development system, see appendix 4.
Staying power on product improvement
As the development of platform, its products and solutions underwent a lot of changes and optimizations. This process required software that has the necessary capabilities build in; it also required implementation teams with deep innovation of the best ways to configure build-in capabilities to optimize essential business processed. It is a good cycle for sustainable innovation on which the company success depends.
3. Issues on current platform and service
Not versatility on external Platform
The products of PTC delivered are so professional as to some of them have became the standards throughout the professional sphere, such as its CAD applications. However, compare to its product, the solutions are not so versatility. For example, some data from upstream system including design, record are not compatible when export to others companies’ system. It is not build a standard platform on the industry, which has some constrain on the innovation.
Not flexible on service
The current service systems for Technical support are horizontal ones, which made the response undertaking layer by layer. It is time consuming and hard to execute.
IV. Proposed Innovation Opportunities
Service Architecture Reorganization
According to the customer's request for defect analysis, process refinement, the vertical service distribution will figure out the solutions on very short time. The organization of the service should be changed to vertical one which is divide different teams based on different solutions, they response for the special customer directly. Then the transition of the old service systems with one encompassing service system could maximize the service scope as well as improve the service quality.
Strong industry platform
So far, PTC has corporation with Microsoft to try to embed its solutions into its SharePoint platform to build up the external platform. It delivered some solutions developed on SharePoint such as WWP, Requirement Link. However, it's a long way to build up the whole industry platform, cooperation with mature platform is just an initial step. Two aspects could be emphasized on to develop the strong industry platform. The first one is to continue release the solutions relied on the famous platform such as SAP, SharePoint. Another one is to build up its own brand platform, since the PTC has already achieved to build up the industry standard for its CAD product as well as become the first mover on integration of PLM solutions, so it is easy to promote its service and others solutions based on its good reputation and technology capabilities.
V. Potential Risk of Proposal
Monetary Investment
While the PTC is costly by itself; we think the cooperation with some big platform such as Microsoft will be the more serious monetary issue. This change will mean an increase in cost on development.
HR restructure
Restructure of the service will cause the reorganization of the human resource as well as leadership team. It dampens the mood of some employees and potentially put the brakes on the changes. As this recommendation includes major changes in processes employees are used to, it is possible that PTC will see workers ill at ease with new structure. However, we are confident that all employees will see that these upgrades will make workload less complicated across all borders.
VI. Conclusion
PTC is doing remarkably well not just in USA, but also across the world. It is time for them to ally their business strategy with some strong platform to enhance capabilities and improve efficiencies internally base on six enduring principles. Because PTC external platform is going very well, we believe this investment is more than beneficial for them to carry out their future potential of improving production processes, sustainable innovation and quality of their platform and really put a gold stamp on PLM domain
VII. Appendix
Appendix 1. Six “Enduring” Principles
Appendix 2. Platform Ecosystem
Appendix 3. Platform and Service Architecture for PTC
Appendix 4. Product Development System
--------------------------------------------
[ 1 ]. Lecture PPT “New Strategic Principles: Platforms & Services”, Michael A. Cusumano
[ 2 ]. Lecture PPT “New Strategic Principles: Platforms & Services”, Michael A. Cusumano
[ 3 ]. PTC official website: http://www.ptc.com/company/
[ 4 ]. PTC official website: http://www.ptc.com/ product-development-system/
[ 5 ]. “The Business of Software: What Every Manager, Programmer, and Entrepreneur Must Know to Thrive and Survive in Good Times and Bad” [2004] Michael A. Cusumano.