At its flagship customer event in Boston this May, PTC executives presented an updated vision of the digital thread, in which post-sales service and support of a product is just as important as its design and manufacture, as Jessica Twentyman reports
Following a four-year hiatus during the Covid-19 pandemic, PTC’s Liveworx conference returned to the Boston Convention and Exhibition Center (BCEC) in May as a live, in-person event.
PTC CEO Jim Heppelmann seemed genuinely delighted to be back on stage, delivering an assured keynote speech loaded with big-ticket, aspirational themes, from agile product development to the industrial metaverse.
As Heppelmann told attendees: “Every disruption creates new opportunities, and right now, we find ourselves in one of the greatest periods of change for industrial companies that I can recall. And most of it revolves around digital transformation in one form or another.”
PTC is clearly on a mission to convince customers they should be capitalising on these huge opportunities. But there’s also been a great deal of change at PTC, too, since Liveworx 2019 – not least an investment of over $3 billion in both organic development and in acquisitions, including the purchases of Onshape (2019), Arena Solutions (2020) and Servicemax (2022).
The company has also forged ahead with plans to start offering its products as cloud-based software-as-a-service (SaaS) offerings, starting last year with the launch of Windchill+, a SaaS version of its PLM product, and continuing at Liveworx 2023 with the announcement of Creo+, a SaaS version of its CAD system.
It makes perfect sense, then, that the digital transformation vision laid out by PTC at LiveWorx demonstrates a notable upstep in the company’s ambitions. “Back in 2019, digital transformation was simpler,” Heppelmann told attendees.
“It meant getting to market faster, with lower costs and higher quality. But now, on top of that, there’s a push to reshore, to make your products more intelligent, your factories more efficient, to build more resilient supply chains, and to make your companies and products more sustainable and compliant, and to accelerate growth by complimenting your products with services. Digital transformation is key to all of that.”
Getting services-centric
If there’s one big theme guiding strategy at PTC today it’s the idea of the digital thread. And that final point made by Heppelmann, about complimenting products with services, took centre-stage at Liveworx 2023.
With the ServiceMax acquisition, a huge piece of the digital-thread puzzle has dropped into place for PTC, because it gives customers the ability to offer efficient service and support in the post-sales period for a machine or vehicle that they have designed and manufactured.
At the heart of the digital thread concept is the idea that data and information about that machine or vehicle should flow through every stage of its lifecycle, from its initial design, through production and onwards. So it therefore follows that data relating to that machine or vehicle’s performance and condition, once it’s in the hands of customers, should also be a part of that thread.
In his own keynote speech, ServiceMax CEO Neil Barua (now president of PTC’s Service Lifecycle Management business) put it this way: “For me, running SLM and our team is about service. Not only is service, in many product companies, the most important generator of sustainable, recurring revenue and profitability, but more importantly, it’s also the criticality of what service does for the world and the things that all of you design, manufacture and put out into the world for us to consume.”
That’s pretty clever positioning. There must be plenty of manufacturing companies using PTC products where executives are no longer satisfied to make a product, make a sale and then walk away. There must be just as many, if not more, that know their customers won’t stand for that in any case. These customers expect a supplier to be a partner. They expect to receive plenty of effective, efficient post-sales care, attention and support. Most importantly, they’re willing to pay for it.
That’s why new equipment-as-a-service (EaaS) business models, which shift customer investment from one-time large capital expenditure (capex) to recurring operating expenditure (opex) payments, based on usage or outcomes, are growing in popularity.
This was well illustrated at Liveworx by ServiceMax customer Schneider Electric, a company most commonly associated with the manufacture and sale of electrical equipment such as uninterruptible power supplies and circuit breakers.
But as the company’s vice president of services digital experience, Jean-Pierre Samilo, explained, Schneider Electric has been on a ten-year journey to become more services-centric. It now offers services that focus on the ongoing monitoring of equipment in the field, its maintenance and repair, reconditioning and replacement of older equipment and recycling for end-of-life kit.
“Services make us more resilient as a company, because we get recurring revenue, but more importantly, it makes us more intimate with our customers, because we now accompany them closely on the post-sales experience and throughout the lifecycle of our products,” said Samilo.
A virtuous cycle
Many of the earlier aspects of the digital thread are already amply provided by PTC. The lifecycle of a product, for example, might begin with its design in CAD programme Creo. Closely aligned with this, PLM programme Windchill can keep a record of all the components and materials used in its manufacture. These, along with other PTC offerings, are the ‘product’ parts of the picture.
But ServiceMax introduces a vital ‘services’ part, said Barua, and aligning the ‘product’ and ‘service’ parts of the PTC portfolio “creates new superpowers for our customers.”
In this vision of a supercharged, responsive, serviceoriented manufacturer, Windchill provides access to the Service Bill of Material for each new product, along with a detailed 3D digital twin. ServiceMax, along with coordinating field service scheduling and dispatch activities, also manages the as-maintained record of the installed product, including which customers own which products as well as details of their individual contractual service entitlements.
Service isn’t an afterthought; it’s now a big part of the business
ThingWorx enables the monitoring of the product in the field, for predictive and preventative maintenance, often performed remotely where possible. Arbortext manages technical service documentation, such as parts catalogues and work instructions specific to the asset, and Vuforia can be used to deliver guidance to technicians on installation and repair activities.
Finally, Servigistics deals with spare part costs, helping manufacturers to save money by keeping spare part inventories at the optimal level necessary to meet their service level agreements with customers.
Importantly, this vision sees the transformation of the digital thread into a closed-loop, virtuous cycle, because information regarding technical issues and engineering change orders associated with products being used by customers can be fed back into the design and manufacturing processes.
This could lead to changes to the underlying design of a product, to the materials or parts used, or the way it is manufactured. And, in effect, the end result is a new and better version of that product.
It’s a compelling idea. “ServiceMax enables PTC to bring this full infinity loop to life,” said Heppelmann, claiming that this way, a product can generate 10 times more service revenue over its life than it does through an initial sale.
“Many companies have products installed all over the world, and some employ an order of magnitude more service technicians than engineers. Service isn’t an afterthought, it’s now a big part of the business.”
This article first appeared in DEVELOP3D Magazine
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