Future Fit Manufacturers Evolve Their Platform Strategies To Scale
Forrester describes how future fit organizations prepare for constant change: They are adaptive, creative, and resilient, and they align platforms, practices, and partners to drive and sustain their transformation. Towards the end of June, two very different companies in the manufacturing sector made announcements that demonstrate some clear thinking about the future fit realities they and their customers face. On the surface these were both “platform” announcements, but practices and partners will be essential to their success. So, too, will driving adaptive, creative, and resilient behaviors deep into the organization.
- Hexagon Nexus: Acquisitions have played a significant role in the growth of Hexagon AB, the Swedish digital reality solutions firm behind brand names like Intergraph, Leica Geosystems, and OxBlue. With Nexus, the company’s manufacturing intelligence division is building a platform to “connect siloed engineering” workflows with the added benefit of harmonizing the data models, development environments, and user interfaces of the company’s own product portfolio as they move to the cloud.
- Siemens Xcelerator: Siemens has larger ambitions for Xcelerator, the company’s open digital business platform. The existing portfolio of Siemens software products continues to move to the cloud. But they’re also being broken down into their constituent microservices, making it feasible for Siemens’ customers to identify and subscribe to specific features as a service — a much cheaper proposition than buying licenses for all of TeamCenter or NX just to access one or two capabilities.
For both organizations, there’s clear value in reducing their own technical debt. Continuing to support all of those monolithic applications that were developed by different teams on different foundations for different purposes and with very different user interfaces is a significant drain on resources and an inhibitor of future innovation. There’s also value in moving to a common cloud platform, harmonizing the codebase, and increasing use of microservices, which makes it easier to move data between previously siloed applications and creates opportunities to offer parts of the portfolio as a service to customers that can’t justify licensing full products.
But both companies recognize that their “platform” story is about more than just the software platform itself. Siemens describes Xcelerator as a “curated portfolio of IoT-enabled hardware, software, and digital services.” The company also stresses a “growing partner ecosystem,” with 50 of Siemens’ 4,000 partners certified to offer products in the Xcelerator marketplace at launch. Nvidia joined that group at the launch event in Munich, with the two companies’ CEOs sharing the stage to make some bold claims about building the industrial metaverse together.
Nexus and Xcelerator are not the only examples of this shift. For example, Autodesk has been building the Forge Data Platform to “integrate Autodesk SaaS products … into your workflows and/or to embed some of the components used in those Autodesk products into your own web or mobile applications,” which looks quite similar to the aim of Hexagon’s Nexus. But Nexus and Xcelerator were launched just a week apart, and the space is starting to get crowded.
Nexus and Xcelerator are not direct competitors (and neither is Forge). They’d be unlikely to be evaluated in the same Forrester Wave™, for example, but they are still targeting broadly similar messages at broadly similar audiences. Siemens wants Xcelerator to be “easier, faster, at scale,” which is welcome and hard to disagree with. The company also cites key design principles for the platform as “interoperability, flexibility, openness, and as-a-service.” The Nexus team didn’t use identical words, but their sentiment was pretty similar.
The direction of travel here is both clear and broadly welcome. The challenge will be to change internal attitudes (and sales behaviors) while striking the right balance between openness and partnership on one hand and defensible and profitable differentiation on the other. The communications teams at Hexagon, Siemens, and their partners and competitors are hard at work to craft messages that describe how they’re changing and why their customers and prospects should care. But none of those messages are landing in isolation: Every time Siemens mentions “flexibility” or “openness” or “as-a-service,” the company’s audience hears and compares it to superficially similar announcements from hyperscale cloud vendors, industrial automation companies, startups, and the rest. Siemens is telling a good story but must understand that what its customers hear is not necessarily what it says — but rather a weird and ever-changing mishmash of messages from Siemens and almost every other firm in the space.