Two recent reports from CIMdata, “State of PLM: Today’s Market & Leading Trends” and “2022 Market Analysis Results,” offer useful insight into the PLM market, growth, and industry trends over the past year. The bottom line? The global PLM market continues to grow and add value.
While disconnects still exist, everyone in the industry—from the PLM user community to solution providers—continues to evolve their thinking in response to changes in technology, globalization, and marketplace pressures. A prime example is the growing sustainability movement, which PLM recognizes as a lifecycle issue, offering opportunities for the industry.
Survey Context and Parameters
CIMdata is well placed to deliver the reports, given their role as the leading independent global strategic management consulting and research authority focused exclusively on PLM and the digital transformation it enables. To gather its annual PLM market data, the company researched, sent survey workbooks, and/or interviewed approximately 700 companies worldwide. Respondents represented a wide range of industries, roles in companies and in the manufacturing process, geographic regions, PLM implementation size, budget, and experience.
Of the respondents, 70% have been doing PLM for more than 10 years, 60% have more than one PLM solution in place, 88% increased or maintained their budget for PLM over the past three years, and 62% will increase their PLM budget in the next two years. One note of concern is a perceived value disconnect, with only 16% of management reporting that they couldn’t work without PLM and 37% viewing it as solely an engineering system, rather than an enterprise platform.
PLM Market Exceeding Expectations
But CIMdata reports good news for the PLM market overall, with the global market exceeding CIMdata’s own forecast to reach a 10.7% increase, up to $5.9 billion. Research and survey responses also indicate a continued move to subscription and that initiatives such as digital transformation are amplifying the impact PLM has on enterprises. All of these trends reinforce the idea that—contrary to what some management thinks—PLM is more than just engineering software. (CIMdata, 2022).
Of the three major segments that CIMdata defines as comprising the PLM Market—collaborative Product Definition management (cPDm), tools, and digital manufacturing—cPDm, is the most common application for PLM. It’s also growing quickly. A core element of PLM, cPDm encompasses the management of product information and processes, visualization and collaboration, configuration and change management, strategic product planning, project and program management, and more. Of cPDm’s two components, software, and services, the latter makes up 55.3% of the overall cPDm market, primarily driven by independent service providers. CIMdata projects the total investment in cPDm, across both software and services arenas, to continue to grow year over year, with an 11/2% compound annual growth rate (CAGR).
Since 2019, the study has found the objectives for future PLM investments are consistently focused on making products better, faster, and cheaper. Other areas of focus include global programs and collaboration, life cycle design, configurability, standards compliance, and more.
PLM Market Leaders
CIMdata’s reports also review the diverse leaders in the PLM market, in terms of mindshare, revenue, and market presence. CAD providers top the list for mindshare, though all leaders provide comprehensive and lifecycle-focused services and many provide tools. All of them are developing broad PLM platforms, as well as recognizing and moving to support new industries and geographies. Dassault Systèmes is at the top of the pack across all categories, and the 80% of revenue they derive from software—versus only 20% for services—proves CIMdata’s point that software revenue is the key driver for PLM marketshare. Dassault, like other leading providers, relies heavily on partners to achieve that dominant market footprint.
Looking to the Future
CIMdata’s market analysis concludes with a review of services providers, as well as an acknowledgement of the ever-evolving PLM services market. As PLM continues to integrate and interface with more and more business solutions, more and different services are required to support that in enterprises. Focused application providers are also contributing to the expansion of the PLM market, typically targeting specific market segments and creating solutions that complement software suites from major providers.
Overall, CIMdata is confident the PLM market still has plenty of potential, especially as the world continues to recover from the impact of COVID-19. They view simulation and engineering systems as continuing cornerstones of the marketplace, and while cloud interest and action has been increasing, they suggest that offering might be reaching a tipping point. On the other hand, PLM refresh programs, services expansion, subscription options, and sustainability efforts all offer new possibilities. PLM remains poised for growth and revenue opportunities in new and exciting directions.
For more detail on market leaders in PLM overall, services, applications, tool segments, and more, get the complete CIMdata reports: “State of PLM: Today’s Market & Leading Trends” and “2022 Market Analysis Results”.