Jim Brown

One-to-One: Reinventing Dassault Systems?
June 20, 2008

I had the chance to talk with ... CEO Bernard Charles and the rest of the Dassault Systems management team this week about the strategy and direction for their business. For a company with such a strong leadership position in PLM, I was impressed with their willingness to rethink and reinvent their business. I write this from Paris following Dassault's analyst day, looking over the Eiffel Tower and thinking if the French were willing to build this structure for a World Fair (it was originally planned to be torn down 20 years after being built) then perhaps it's not surprising that Dassault would be willing to reinvent themselves as well. Note, the tower still stands strong - as does the current DS business.

What do they Do?
Dassault Systems (DS) provides arguably the premier CAD system in the world, CATIA. Beyond this, DS has reinvented itself a number of times by extending their solutions to a much fuller suite of PLM solutions. Over time, they have evolved to extend the PLM suite to include data management, business processes to develop and manage world class products, virtual/digital manufacturing solutions, and more. The company has shown the ability to move with their customers and the market as needs and ambitions have grown. They moved from an engineering-centric view with CAD and digital mockup to address business processes including portfolio management, product compliance, and more. They have expanded beyond PDM to a fuller view of the product - a core fundamental of PLM in my mind - and have started calling it a "IP management system" to represent the change. Through this process they have shown the ability to reinvent, for example acquiring MatrixOne (a PLM system) when they already had Enovia as their own solution (and SmarTeam, for that matter). But the market needed more enterprise/supply chain PLM capabilities than what Enovia was designed to do, and this conference marks the release of V6 which includes a common PLM system that encompasses capabilities from both, but based on a core based on MatrixOne's architecture. A bold move.

What could they Do Next in PLM?
DS is driving to what they call "PLM 2.0" which includes a customer to customer view of PLM. Leveraging their core strength in 3D, their current message is "see what you mean." Bernard and the team's vision for Dassault includes the incorporation of "lifelike experience" in 3D, powered by acquisitions of companies such as Abaqus (now part of the Simula brand). This includes the ability to bring 3D product models to life with not just simple kinematics, but by applying advanced physics modeling to make them behave in the virtual world as closely as possible to the way they would behave in the real world. They are also investing in extending the ability to make the virtual product look as real as possible on a computer screen, with some remarkable results.

PLM 2.0 leverages this capability to allow customers to experience products in the virtual world. This is a unique strategy, adding gaming-like (and beyond) quality to virtual products. In fact, they acquired Virtools which provides these capabilities to the gaming industry (Electronic Arts spoke at the event, very interesting to see the world from the next generation of customers' view).  These capabilities can be applied up front in product development to allow customers to help design and shape products (and the whole product experience). It can also be used to propel Dassault out of the front end of the product (innovation) to help manufacturers market and sell their products. Dassault's capabilities are being harnessed to reinvent the consumer buying experience by letting them interact with the product in the virtual world. Will others do this? Certainly, and not just PLM vendors. Dassault doesn't own this space, but Bernard has a gleam in his eyes when he talks about it.

What could they Do Next outside of PLM?
Dassault is extending PLM, but also looking beyond. The company has the ability to envision itself beyond the current market. From a joint venture to apply their know-how to marketing (more on 3Dswym in a later post) to gaming and more. Their foray into online 3D communities, with 3DVia.com, is an example of where Dassault believes there will be value in the future. DS' newest brand, 3DVia, is exploring the intersection of online communities and 3D experience. DS wants to learn by doing and help shape the future along the way. In  Bernard's words, they are "still finding their way, but have time" in this market, but private conversations reveal that his patience isn't just show. Regardless of the outcome and direction that will evolve over time, the one thing that is clear is that Dassault will not stand still, and will explore a number of options.

What will they Actually Do?
The first thing is that they will not walk away from their current position as a leader in PLM. They are dedicated and investing, as the recent V6 release shows. Dassault has a very strong position in the market and supports some of the largest manufacturers in the world. They are not walking away from that market by any stretch of the imagination. They recognize that PLM is a strong, growing market. At the same time, they aren't expecting that their leadership in that market today will be enough to sustain sufficient growth over time. As they stated repeatedly - they need to expand to new users, new industries, and new solutions over time. Only time will tell which of the areas they are exploring for growth will be the most fruitful.

So that's what I hear from Paris, I hope you found it useful. What do you think? What else should I have asked them?

Posted by Jim Brown on June 20, 2008 | Comments (0)