Summarizing PTC’s Decades of Fervent In-House Innovation (and Acquisitions) - Part 1

Needham, Massachusetts (US)-based Parametric Technology Corporation (PTC, NASDAQ: PMTC) is an over USD 1 billion large software company that develops, markets, and supports product development software solutions and related services. The company’s solutions help its client companies design products, manage product information, and improve their product development processes. PTC’s software solutions and services have helped its customers increase innovation, improve product quality, decrease time to market (TTM), and reduce product development costs.

PTC offers solutions in the product development market, which encompasses the product lifecycle management (PLM) market (i.e., product data management [PDM] and related collaborative solutions) and the so-called CAx (computer-aided technologies) market, which includes computer-aided design (CAD)computer-aided manufacturing (CAM), and computer-aided engineering (CAE) solutions. The company’s software solutions provide its customers with an integral product development system (PDS) that enables these enterprises to create digital product content, collaborate with others in the product development process, control product content, automate product development processes, configure products and product content, and communicate product information to people and systems across the extended enterprise and design chain. 

PTC has devoted significant resources to developing its PLM solutions and integrating them with multiple CAD and related software solutions, thus fostering openness and interoperability. At the same time, the vendor continues to integrate its PLM products more tightly and make them easier to deploy, as it believes that these capabilities will create significant added value for its customers. Using PTC's tightly integrated CAD and enterprise PLM solutions, organizations are better able to create and manage product information throughout the lifecycle for optimal product development success.

Currently, PTC has over 5,300 employees that are focused solely on product development solutions. Every year, more than 25,000 active customers rely on the company’s solutions to help give life to their ideas and drive their product development success. Of those tens of thousands of customers the 2,000 largest ones, who are brand name original equipment manufacturers (OEMs) such as Toyota, Boeing, HP, Raytheon, Stryker, Hitachi, or COACH, are handled by PTC’s direct sales force and professional services, while the remainder of small and midsize enterprises (about 80 percent of the install base) are handled by its over 400 partners.

PTC customers are primarily discrete manufacturing firms in the following industries: federal aerospace & defense (A&D), automotive, industrial equipment, high-tech electronics, medical devices, consumer goods, and footwear & apparel manufacturers and retailers. Geographically, the company receives 76 percent of its revenues equitably from Europe and North America, with the remaining 24 percent coming from Asia-Pacific. PTC has more than 1.2 million active maintenance seats of its software in use today.

PTC’s over 5,000 employees are based in 18 global development locations: two corporate visitor centers in Needham, US and Shanghai, China, and many other offices around the world. The company will be opening an automotive research and development (R&D) center in Korea in 2011, in addition to R&D centers and centers of excellence (COE’s) in France, Germany, India, and other countries.  Most of PTC’s products are available in the following 10 languages: English, French, German, Italian, Japanese, Korean, Russian, Simplified and Traditional Chinese, and Spanish.

PTC’s Genesis

As one could see from the abovementioned list of PTC’s customers, PTC software is used to design many of the products that make up our daily lives, including appliances, cars, cell phones, computers, trucks, and shoes. Since its inception in 1985, the company’s ability to foresee industry needs has enabled it to be consistently first to market with powerful product development solutions.

In 1988, PTC shook up the product design industry with Pro/ENGINEER (a.k.a., Pro/E) the first parametric, associative feature-based, solid modeling software. John Deere became the company’s first customer at that point.  Since going public in 1989 under the PMTC ticker symbol, PTC has developed and acquired products that make up a comprehensive portfolio of software products that tie into a single integral environment that the vendor calls the PTC Product Development System (PDS). In 1992, Caterpillar becomes the company’s largest customer.

To address the needs relating to the entire product lifecycle for customers in many industries, PTC has acquired 18 companies to add both technology and industry expertise to its offerings.  In 1998, PTC acquired Computervision mainly for its CADDS product design software and its data management capabilities to bolster Pro/E.  The acquisition also (perhaps serendipitously at the time when hardly anyone talked about PLM concepts) included collaborative software developed by Windchill Technologies, which was led by Jim Heppelmann (who heads PTC today).

At the time, Windchill was the first to market Internet-based PLM solutions. Today, the PTC Windchill PLM suite [evaluate this product] is one of PTC’s main product lines and growth engines (and will be analyzed in subsequent parts of this series).

In 1999, PTC acquired the visualization product ProductView from the Division Group (which had previously acquired ObjectLogic, owner of ProductView) and surpassed 25,000 customers. ProductView tools enable enterprise-wide visualization, verification, annotation, and automated comparison of a wide variety of product development data formats, including 2D and 3D mechanical CAD (MCAD), electronic CAD (ECAD), and documents.

These solutions provide lightweight access to product designs and related data without requiring the original product authoring tool. ProductView was recently renamed Creo Elements/View in connection with the product launch of PTC’s new product, PTC Creo, which will be described in more detail later (for more information on Creo, here is a related blog post by Oleg Shilovitsky).

In 2001, PTC launched Windchill ProjectLink, a pure Internet architecture solution for project collaboration. In 2002, PTC surpassed 35,000 customers and launched Windchill PDMLink, a pure Internet architecture PDM solution, and Pro/ENGINEER Wildfire, the first CAD system to fully support Web services.

Expanding into Service Businesses

In 2005, PTC acquired Arbortext for its technical product data authoring and dynamic publishing solution. This acquisition was followed by the related acquisitions of ITEDO, a 2D and 3D technical illustration and animation software company, in 2006, and LBS Ltd., a leader in integrated logistics support (ILS) solutions for A&D and civil aviation in 2007. These acquisitions have bolstered PTC’s technical illustration and A&D portfolio, respectively.

The added capabilities for dynamic authoring, publishing, and service information have enabled service organizations to create and manage the content needed by field service professionals. Arbortext enterprise-wide solutions enable PTC customers to manage complex information assets that enhance their customer support and service center information delivery processes.

Optimized for managing Extensible Markup Language (XML)-based structured content and 2D and 3D technical illustrations created using the Arbortext authoring products, these solutions support collaboration by geographically dispersed teams and manage critical processes such as configuration management and the release of multilingual and multi-channel technical documentation. Arbortext solutions consist of a Windchill-based content and configuration management system that manages the XML components, illustrations, and related localized content components and a dynamic publishing server that produces output automatically in the format and language specified by the user.

In addition, desktop-based Arbortext authoring products Arbortext Editor and Arbortext IsoDraw are designed to help customers improve documentation accuracy, speed TTM, reduce translation requirements, and lower publishing costs. Arbortext Editor is an XML component-based authoring tool used to create structured content to automate multiple output types. The editor works like familiar word processing software to create reusable content components, which can be aggregated into dynamic, customized publications.

With Arbortext Editor, documents can be created by multiple contributors and managed in a structured content management system (CMS) to enable content reuse across multiple outputs, whether printed or digital. When changes to content are made, those changes are reflected wherever that content is used to maintain version control.

For its part, Arbortext IsoDraw is a technical illustration solution that enables companies to create both 2D and 3D technical illustrations and animations from scratch or from existing CAD data. Illustrations and animations created using Arbortext IsoDraw can be embedded into Arbortext content components, resulting in rich technical publications such as manufacturing instructions, operator guides, parts catalogs, and interactive service procedures.

The combination of the Arbortext and ITEDO acquisitions, Arbortext IsoDraw, has enabled PTC to target new segments, such as the service parts aftermarket and financial services. There has been an increasing need for tightly integrating the service lifecycle management (SLM) with PLM. The addition of Arbortext IsoDraw, much like Dassault Systemes’ 3DVIA Composer (formerly Seemage), has enabled fully integrated documentation of a product design or product repair instructions via a lightweight 3D CAD model.

Manufacturing and service companies have since been able to create and update their service and customer manuals that leverage product content managed by PTC’s PDM software. One use case scenario would be a field service technician fixing a washing or photocopier machine who needs succinct, visually supported instructions to make the repair quickly. The result is an increased effective time in the field to see more customers and lower repair costs. For more information on this topic, see my recent article on Servigistics’ similar SLM offering that involves service knowledge and service content modules, in addition to the field workforce scheduling and spare parts planning capabilities.

Other Important Mid-2000s Acquisitions

In 2005, PTC also acquired Aptivis Technology Corporation, which formed the basis of Windchill FlexPLM [evaluate this solution], a specialized version of Windchill that has enabled the vendor to address the needs of footwear and apparel/fashion firms (so-called "softline" retailers and manufacturers). Although the retail sector generates only a small portion of PTC’s overall revenue (about 8 percent), by acquiring the assets of Aptavis and hiring approximately 100 retail specialists at the time, the company has been able to successfully grow its presence in the industry.

PTC complements its FlexPLM software with professional services through partnerships with retail consultants Kurt Salmon Associates (KSA) and Walter Wilhelm AssociatesFor more information, see TEC’s blog post from PTC’s 2010 user conference.

In 2005, PTC acquired Polyplan Technologies for its technology and expertise in manufacturing process management (MPM), and has since integrated it into the Windchill product line. In 2007, the integrated product Windchill MPMLink was announced, along with two manufacturing execution system (MES) partnerships, Camstar and Visiprise (now part of SAP), to enhance its application for integrated product and product design (IPPD). The product focuses on ensuring design for manufacturability (DFM) or concurrent engineering, but it does not enable simulation of manufacturing lines and operations as Dassault DELMIA or Siemens Tecnomatix do.

In 2006, PTC acquired MathSoft for its renowned MathCad software that is considered the industry standard in the field. MathCad is a relatively easy to use engineering calculation software solution that combines a computational engine, accessed through conventional math notation, with a full-featured word processor and graphing tools.

MathCad allows customers to test their Pro/E designs and predict the behavior of a Pro/E model, which can then be validated using PTC’s Pro/E CAE solutions. This approach can help PTC’s customers speed TTM by significantly reducing the number of iterations necessary to complete a design. In addition, when combined with the Windchill PLM solutions, the valuable intellectual property captured in MathCad can be managed and shared securely with others for reuse and regulatory compliance.

Parametric and Direct Modeling Reconciled

In 2007, PTC acquired CoCreate for its direct modeling 3D CAD capabilities, primarily to add its existing customers and history-free, dynamic modeling capabilities. To put things into perspective, PTC’s historical strength comes from its pioneering parametric (thus the company’s name), history-based modeling tools in the mother Pro/E product, which really captured the market first back in the early to mid 1990s.

This method of design requires designers and engineers to retrace a series of design steps taken (the history) if they want to make certain changes or updates to their 3D model. While this was once (and to some degree still is) desired for process control and for knowledge of the design intent, it has become constraining in some environments that require quicker and simpler design in today’s more dynamic world.

So this means that there is a place for a so-called direct modeling or explicit modeling approach, i.e., the ability to push and pull on designed object’s surfaces to change them without concern for the design history. Needless to say, the direct and parametric modeling approaches are quite different and each one is best suited for different jobs.

Direct or explicit modeling provides speed, flexibility, and responsiveness to change for customers facing short design cycles, one-off product designs, or companies demanding a lightweight design. This method is easier and faster to learn and use because users work directly with the geometry, without having to capture information about features, parameters, parent/child relationships between parts, etc. Examples of the products that are engineered to order (ETO) in this manner include furniture, plastic fasteners, low cost printers, and cell phones.

On the other hand, parametric or history-based modeling is best suited for relatively complex, long lasting (durable) products that have many interacting parts and structures that may be modified over time. Users work with 2D or 3D sketches, features, parameters and structures, which create the geometry. Examples of parametric-modeled products, which are designed to be either built to order (BTO) or assembled/configured to order (ATO), include automotive or aerospace engines, trucks, tractors, and medical devices.

Until recently, Siemens was the only major CAD peovider with a unique flavor of direct modeling with its Synchronous technology (now in its third version). The Synchronous technology, which manifests itself in both Siemens’ NX and Solid Edge CAD products, combines the convenience of direct modeling with a greater ability to import data from other systems more openly. At its core is an intuitive inference engine that anticipates the intent of the designer, reportedly making design and/or modeling up to 100 times faster in certain situations. Niche provider SpaceClaim Corporation also offers similar capability.

In summary, direct modeling was one key area where PTC had been behind prior to 2007. The explicit modeling tool from CoCreate has since enabled PTC to offer a much more comprehensive suite of modeling solutions, which will be joined with Pro/E’s parametric modeling in the aforementioned upcoming Creo applications (formerly code named Project Lightning). As said earlier, Creo will be described in more detail in subsequent parts of this blog series. For more information, see the blog post by Jim Brown of Tech-Clarity. Pro/E and CoCreate have meanwhile been renamed Creo Elements/Pro and Creo Elements/Direct, in addition to the aforementioned renaming of ProductView as Creo Elements/View.

In addition, here is a useful YouTube video of Mike Campbell, PTC’s divisional vice president of design and visualization products, talking about how the two modeling approaches will work together in Creo to enable people to choose the right modeling mode for the job within one environment. With Creo, PTC will have one design software suite with applications for both modeling approaches that share the user interface (UI) and file formats so that users can move between both modeling modes and design models with relative ease.

Part 2 of this blog series will analyze PTC’s more recent acquisitions and the company’s current state of affairs. In the meantime, your comments, thoughts, suggestions, or individual experiences with the aforementioned product development issues and PTC’s related solutions are customarily more than welcome.
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