#SIAC18 showed that Siemens is more than the sum of its parts
Every year in late August or early September, Siemens throws a big information-fest for industry analysts and journalists where they explore the latest industry trends and technologies, and highlight Siemens’ place in its customer/partner ecosystem. It’s tough to summarize because there are so many moving parts but here are my key takeaways from last week’s event:
This year, rather than an NX session, one of Teamcenter, etc. Siemens elected to focus on industrial themes and how their offerings support companies working in that area. For autonomous vehicles, for example, we covered sensors, systems and simulation. This gets to one of the company’s key themes for this event: that the traditional labels and boundaries are disappearing, and that Siemens will best serve its clients by creating integrated solutions. After all, most technology buyers start with a problem to solve, and not a technology to buy.
This is bigger than the PLM business. PLM’s products are being used across the AG, as NX, Simcenter, Teamcenter et al are used in the design and production of medical devices, eAircraft, autonomous and guided vehicles, energy systems — all across the business. And those are tough, tough customers for the PLM team, pushing to make their solutions ever more hardened and fit-for-purpose. It’s a strong proof point that the Siemens businesses rely on PLM’s tools and can show how well those solutions work outside the demo environment.
Analyst events usually involve two kinds of speakers: company and customer. The company speakers talk about technology and the customers about how they apply it to solve real-world problems. Company management talks about the business and its overall direction — and those were really solid this year. The CEO of Digital Factory, PLM’s parent within the current Siemens organization, Jan Mrosik, talked about how software-focused Siemens is today — it employs over 24,000 software engineers. And with software revenue of nearly $5 billion across the AG (€3.4 billion in the PLM business), he said it’s one of the top 10 global software companies.
Tony Hemmelgarn, CEO of the PLM business, talked about integrated platforms and solutions that solve problems — like the merging of CAD and simulation for topology optimization, and then perhaps adding in business logic for true generative design. Tony also gave a brief update on the PLM business, highlighting that revenue is growing at over 10% per year, not including acquisitions — far faster when adding those into the total. This is the slide he used to summarize the business:
Acquisitions came up early and often (and you can see it in the bottom row of the image above) and so did Bentley. Siemens and Bentley announced that they’re expanding their partnership by doubling their joint investment to €100 million, and Siemens now owns 9% of Bentley’s non-voting common shares. But what I really liked was the tease in the technology showcase of how they’re putting together Bentley’s Projectwise and Teamcenter to enable the companies to go more/bigger/further in infrastructure projects. The intention (demonstrated to some extent last week, but not really ready for early visibility until year-end and for broader distribution in mid-2019) will takes plant engineering data from Bentley OpenPlant, Siemens COMOS, or a third party and use Teamcenter for enterprise-level data management and collaboration. The point: infrastructure assets are designed and built in a couple of years and then operated for decades. Tying together the data frameworks means that projects can be optimized from design through construction to operations/maintenance and eventual shutdown. It’s a big step towards creating a digital twin of an intelligent plant.
Speaking of acquisitions, we were introduced to Mendix, the company Siemens is buying. Mendix makes a low-code application development platform that enables companies to quickly create software solutions of many different types: cellphone apps for customer self-service. Connections between systems that enable sales people to configure and give production estimates. Connect IoT devices to MindSphere. Their platform supposedly does app development 10 times faster and with 70% fewer resources — I would imagine that actually depends on the complexity of the application and the skill level of the developer — but the point is that Mendix will enable companies to think differently about and implement technology.
And while I could keep going, it’s fitting to end on Mendix because I think Mendix embodies what SIemens wants to become: agile, collaborative, building customer/client communities, solving gnarly problems in an elegant and intuitive way. And I don’t mean that just for PLM; I think the AG’s leadership wants those entrepreneurial qualities to percolate through the AG.
We’ve come so far since the first analyst meetings, which were all about the latest NX/Teamcenter/Tecnomatix functions and features, user interfaces improvements and faster mouse movements. Nothing like that this year (though there was a bit of that in the Solid Edge University keynote — more coming on that when I get time). Instead, Siemens showed off its prowess in creating cross-product solutions that fade into the background, letting the user solve a problem not master a technology.
Note: Siemens graciously covered some of the expenses associated with my participation in the event but did not in any way influence the content of this post. The cover image and slide in the text are from Tony Hemmelgarn’s presentation at the event, supplied by Siemens.
Update: An earlier version of this post had the wrong hashtag for the event. It is #SIAC18 (Siemens Industry Analyst Conference). Oops.