One-to-One: Reinventing Dassault Systems?

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?