The Sustainability Imperative - CIMdata

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The Sustainability ImperativeCIMdata 2022 PLM Market & Industry ForumEnabling Sustainability in the PLM EconomyPLM Market & Industry ForumA CIMdata PLM Leadership Event6 April 2022Stan Przybylinski, Vice PresidentEmail: s.przybylinski@CIMdata.comTel: 1.734.668.9922Global Leaders in PLM Consulting#plm4umwww.CIMdata.comCopyright 2022 by CIM data, Inc.1Copyright 2022 by CIM data, Inc.Our Mission.Strategic management consulting for competitive advantage in global marketsCIMdata is the leading independent global strategicmanagement consulting and research authorityfocused exclusively on PLM and the digitaltransformation it enables.We are dedicated to maximizing our clients' abilityto design, deliver, and support innovative productsand services through the application of PLM.Copyright 2022 by CIM data, Inc.This presentation is copyright 2022 by CIMdata, Inc. Clip art may be copyrighted. Nouse, reproduction or modification is permitted without prior written permission.CIMdataâ is a registered trademark of CIMdata, Inc.2Page—1

The Sustainability ImperativeCIMdata 2022 PLM Market & Industry ForumKey TakeawaysEnabling Sustainability in the PLM Economy—2022 CIMdata PLM Market & Industry Forum CIMdata believes that PLM is central to sustainability; industrials, ISVs, andSI/Reseller/VARs need to succeed together Virtually all PLM revenues leaders have efforts underway that seek tosupport both sustainability within their own organizations and to supporttheir customers’ efforts The three stakeholders are mostly aligned but there are some interestingdifferences in perception This is an existential challenge that also offers significant businessopportunitiesCopyright 2022 by CIM data, Inc.3AgendaEnabling Sustainability in the PLM Economy Responding to the Sustainability Imperative 2022 CIMdata Foresight Sustainability Research – ISV/SI Elements of their Response Understanding their Customers Concluding RemarksCopyright 2022 by CIM data, Inc.This presentation is copyright 2022 by CIMdata, Inc. Clip art may be copyrighted. Nouse, reproduction or modification is permitted without prior written permission.CIMdataâ is a registered trademark of CIMdata, Inc.4Page—2

The Sustainability ImperativeCIMdata 2022 PLM Market & Industry ForumPLM – CIMdata’s DefinitionPorAolio(&(Program((Management(Digital transformation of the lifecycle—enabled by a product innovation platform(Requirements interface layerSystem((Idea on(Service(Management( Strategic business approach NOT just technologies Consistent set of business solutions Collaborative creation, use, management& dissemination of product related intellectual LifecycleBackbone(DataModeling& Process& stem(Realiza on((Quality(&(Compliance( All product/plant definition information – the virtual productProfitability(Management( AEC, MCAD, EDA, ALM, SE, requirements, simulations, analytics, portfolio, formulas All product/plant process definitions – the virtual processes Processes that plan, design, produce, operate, support, decommission, recycle An innovation platform that supports the extended enterprise Spans the full lifecycle, from idea/concept through lifeCopyright 2022 by CIM data, Inc.5Colliding Major TrendsSystems thinking and PLM critical to a systemic response CIMdata formed to study the application of digital technology to the productlifecycle, there at the conception of PLM, evolved a lot over the last 20 years Industry 4.0 vision encapsulates some key drivers: smart connectedeverything, and sustainability Helped to drive a wave of digital transformation, success for productcompanies requires a strong PLM foundation Sustainability also requires a systemic approach, powered by PLM andbusiness platformsCopyright 2022 by CIM data, Inc.This presentation is copyright 2022 by CIMdata, Inc. Clip art may be copyrighted. Nouse, reproduction or modification is permitted without prior written permission.CIMdataâ is a registered trademark of CIMdata, Inc.6Page—3

The Sustainability ImperativeCIMdata 2022 PLM Market & Industry ForumBusiness Platforms KeyElements of all three platform levels needed for sustainability (topic from 2015 PMIF) “Business Platform” An architecture that allows a comprehensive set of heterogeneous functional processenabling capabilities to be packaged and configured to establish and support standardizedend-to-end business processes, and related data access “Innovation Platform”BusinessPlatform A business platform designed to enable an enterprise’sinnovation processes Helping users to create, manage, and re-use data andintellectual property for maximum business impact andeffectivenessInnovationPlatform “Product Innovation Platform”ProductInnovationPlatform An innovation platform that cultivates continuous creativity,yielding improvements in products and processes plus inspiringnew and better ones throughout full lifecycles and across generationsof a products7Copyright 2022 by CIM data, Inc.2021 Overall PLM Revenue LeadersMany diverse companies generate PLM revenue**************************Have a sustainability programRevenues presented are CIMdata estimatesCopyright 2022 by CIM data, Inc.This presentation is copyright 2022 by CIMdata, Inc. Clip art may be copyrighted. Nouse, reproduction or modification is permitted without prior written permission.CIMdataâ is a registered trademark of CIMdata, Inc.8Page—4

The Sustainability ImperativeCIMdata 2022 PLM Market & Industry ForumUN Sustainable Development GoalsCited by many of the market leaders as helping to drive their sustainability program Many leaders cited the UN SDGsin their discussion of theirsustainability efforts How many SDGs will their effortscover? Connecting SDGs to specificbusinesses, offerings Common frameworks helpful toframe the t/sustainable-development-goals/Copyright 2022 by CIM data, Inc.9AgendaEnabling Sustainability in the PLM Economy Responding to the Sustainability Imperative 2022 CIMdata Foresight Sustainability Research – ISV/SI Elements of their Response Understanding their Customers Concluding RemarksCopyright 2022 by CIM data, Inc.This presentation is copyright 2022 by CIMdata, Inc. Clip art may be copyrighted. Nouse, reproduction or modification is permitted without prior written permission.CIMdataâ is a registered trademark of CIMdata, Inc.10Page—5

The Sustainability ImperativeCIMdata 2022 PLM Market & Industry ForumCIMdata Sustainability Survey for ISVs/SIs et al.How are solution providers and SI/Reseller/VARs responding to these requirements? Conducted a second survey, focused on independent software providers(ISPs) and System Integrators/Reseller/VARs Promoted using multiple emails to CIMdata’s contacts in those segments,social media 134 responses, including most of the global PLM leaders Not an exhaustive survey What topics are central for them, which ones are critical for their clients,what do they think that clients want/are asking for More successful if in the organizations DNACopyright 2022 by CIM data, Inc.11Geography of RespondentsVery close to historical split of global PLM revenuesAP16%EMEA44%The Americas40%2022 CIMdata Foresight Sustainability Research – ISV/SICopyright 2022 by CIM data, Inc.This presentation is copyright 2022 by CIMdata, Inc. Clip art may be copyrighted. Nouse, reproduction or modification is permitted without prior written permission.CIMdataâ is a registered trademark of CIMdata, Inc.12Page—6

The Sustainability ImperativeCIMdata 2022 PLM Market & Industry ForumPrimary Business of the Respondent’s CompanyGood representation of each business categorySI / Reseller / VAR36%ISV64%2022 CIMdata Foresight Sustainability Research – ISV/SICopyright 2022 by CIM data, Inc.13AgendaEnabling Sustainability in the PLM Economy Responding to the Sustainability Imperative 2022 CIMdata Foresight Sustainability Research – ISV/SI Elements of their Response Understanding their Customers Concluding RemarksCopyright 2022 by CIM data, Inc.This presentation is copyright 2022 by CIMdata, Inc. Clip art may be copyrighted. Nouse, reproduction or modification is permitted without prior written permission.CIMdataâ is a registered trademark of CIMdata, Inc.14Page—7

The Sustainability ImperativeCIMdata 2022 PLM Market & Industry ForumEveryone is a Market Leader in Sustainability“Where does your company rate against your peers?”0%10%20%30%40%50%60%70%80%My company is a leader in sustainability in ourindustryMy company is average with respect tosustainability in our industryMy company lags in sustainability in our industryISVsSIs et al2022 CIMdata Foresight Sustainability Research – ISV/SICopyright 2022 by CIM data, Inc.15Who Are the Market Leaders?“Who are the leaders in sustainability among providers of PLM-enabling solutions (services)?”ISVsSI/Reseller/VARs Aras Capgemini Centric Software Dassault Systèmes Google SAP Siemens Digital Industries Software Dassault Systèmes Siemens Digital Industries Software2022 CIMdata Foresight Sustainability Research – ISV/SICopyright 2022 by CIM data, Inc.This presentation is copyright 2022 by CIMdata, Inc. Clip art may be copyrighted. Nouse, reproduction or modification is permitted without prior written permission.CIMdataâ is a registered trademark of CIMdata, Inc.16Page—8

The Sustainability ImperativeCIMdata 2022 PLM Market & Industry ForumImportance of the UN SDGsISVs are pretty consistent0%10%20%30%40%50%60%70%80%90% 100%The UN SDGs are critical to our strategyThe UN SDGs are an important part of our strategyThe UN SDGs are a small part of our strategyISVsSIs et al2022 CIMdata Foresight Sustainability Research – ISV/SI17Copyright 2022 by CIM data, Inc.Culture and Workforce TopicsChoose those relevant to your company0%10%20%30%Sustainability is part of the corporate cultureReducing costs, e.g., energy efficient products,production, logisticsDecarbonizing products, production, and logisticsEmployees across the organization understandhow sustainability efforts align with overall Building sustainable brandsEnabling Products-as-a-ServiceAll employees receive training on how to integratesustainability practices into their workOther (Please Specify)ISVsSIs et al2022 CIMdata Foresight Sustainability Research – ISV/SICopyright 2022 by CIM data, Inc.This presentation is copyright 2022 by CIMdata, Inc. Clip art may be copyrighted. Nouse, reproduction or modification is permitted without prior written permission.CIMdataâ is a registered trademark of CIMdata, Inc.18Page—9

The Sustainability ImperativeCIMdata 2022 PLM Market & Industry ForumAgendaEnabling Sustainability in the PLM Economy Responding to the Sustainability Imperative 2022 CIMdata Foresight Sustainability Research – ISV/SI Elements of their Response Understanding their Customers Concluding Remarks19Copyright 2022 by CIM data, Inc.Importance of the UN SDGs to CustomersSurprised by difference at the top and bottom of the chart0%10%20%30%40%50%60%The UN SDGs are critical to most of our customersThe UN SDGs are critical to some of our customersThe UN SDGs are critical to a few of our customersThe UN SDGs are not critical to our customersISVsSIs et al2022 CIMdata Foresight Sustainability Research – ISV/SICopyright 2022 by CIM data, Inc.This presentation is copyright 2022 by CIMdata, Inc. Clip art may be copyrighted. Nouse, reproduction or modification is permitted without prior written permission.CIMdataâ is a registered trademark of CIMdata, Inc.20Page—10

The Sustainability ImperativeCIMdata 2022 PLM Market & Industry ForumImportance of Circular to CustomersHow important are circular economy concepts and approaches to your customers?0%10%20%30%40%50%60%70%The circular economy is central to their companystrategyCircular concepts are used in some of theirfunctions but not allCircular concepts are not important to theircompanyISVsSIs et al2022 CIMdata Foresight Sustainability Research – ISV/SICopyright 2022 by CIM data, Inc.21What Technologies Can Help the Most?Asked the same question of the three different audiences: ISVs, SIs et al., and Industrial companies Mechanical Computer-Aided Design(MCAD) Data and process managementsolutions that support value chaincollaboration (PLM) Simulation and Analysis (S&A) Electronic Computer Aided Design(ECAD) / Electronic DesignAutomation (EDA) Digital twins Digital thread Internet of Things (IoT) Augmented Reality (AR) Manufacturing Process Planning andSimulation, often referred to asDigital Manufacturing Supply Chain Management (SCM) Model-Based Systems Engineering(MBSE)2022 CIMdata Foresight Sustainability ResearchCopyright 2022 by CIM data, Inc.This presentation is copyright 2022 by CIMdata, Inc. Clip art may be copyrighted. Nouse, reproduction or modification is permitted without prior written permission.CIMdataâ is a registered trademark of CIMdata, Inc.22Page—11

The Sustainability ImperativeCIMdata 2022 PLM Market & Industry ForumWhat Technologies Can Help the Most?What was the most essential for each group? (1 to 10, 1 most important)IndustrialISVSIs et alMCAD47*7*PLM111*S&A745MBSE87*9Digital twins95*6Digital thread333IoT5*27*AR107*10Digital Manufacturing5*104SCM25*1**Tied2022 CIMdata Foresight Sustainability Research23Copyright 2022 by CIM data, Inc.Support for Different Lifecycle Use CasesWhat was the most essential for each group? (percent of respondents selecting each choice)IndustrialISVSIs et alProduct carbon footprint16%*15%*14.3%*Sustainability compliancy15%*14%14%Design for Sustainability22%15%*22%*Material substitution – ecofriendly mat’l DB16%*24.7%32%Sustainability traceability via the Digital Thread15%*14.4%22%*3%14%14.3%*Connected Assets – Digital Twin*Tied2022 CIMdata Foresight Sustainability ResearchCopyright 2022 by CIM data, Inc.This presentation is copyright 2022 by CIMdata, Inc. Clip art may be copyrighted. Nouse, reproduction or modification is permitted without prior written permission.CIMdataâ is a registered trademark of CIMdata, Inc.24Page—12

The Sustainability ImperativeCIMdata 2022 PLM Market & Industry ForumAgendaEnabling Sustainability in the PLM Economy Responding to the Sustainability Imperative 2022 CIMdata Foresight Sustainability Research – ISV/SI Elements of their Response Understanding their Customers Concluding Remarks25Copyright 2022 by CIM data, Inc.Achieving the “Triple Bottom Line”“People, planet, and profit” – consumer interest moving sustainability to a competitive advantage Public companies are beholden to their shareholders Corporate Social Responsibility (CSR) programs emerged in the 1960s Business strategy? Greenwashing? One way to evaluate CSR efforts is the Triple Bottom Line Elevated consumer interest in sustainability: 93% of global consumers say COVID-19 influenced their views on sustainability 22% more consumers say environmental responsibility is very or extremely importantwhen choosing a brand than in 2019 62% of consumers now say they’re willing to change their purchasing behavior to helpreduce negative impact on the environment (up from 57% in 2019) PLM solutions and services can help with all threeIBM Institute for Business Value.” Sustainability at a turning point,” 2021Copyright 2022 by CIM data, Inc.This presentation is copyright 2022 by CIMdata, Inc. Clip art may be copyrighted. Nouse, reproduction or modification is permitted without prior written permission.CIMdataâ is a registered trademark of CIMdata, Inc.26Page—13

The Sustainability ImperativeCIMdata 2022 PLM Market & Industry ForumShaping the Sustainable OrganizationAccenture study in collaboration with the World Economic Forum – leaders make significant gains! In a 2020 study by Accenture “73% of executives said that becoming a “trulysustainable and responsible business” was a top priority for theirorganization over the next three years.” “Of 1,122 CEOs surveyed by the UN Global Compact in 2021, 79% said thepandemic has highlighted the need to transition to more sustainablebusiness models.” “ leadership teams that build sustainability into the DNA of theirorganizations are better able to deliver financial value and wider stakeholderimpact. In fact, those with the most deeply embedded sustainabilitymanagement practices outperform peers by 21% on both profitability andpositive environmental and societal outcomes.”https://www.accenture.com/ pyright 2022 by CIM data, Inc.27What is the Business Opportunity?How can the PLM Economy best support these requirements? Just like PLM, this is a people—process—technology issue ISVs and SIs et al. can help with all three, depending on their expertise andofferings The Triple Bottom Line is a laudable goal, but only the most committedachieve sustainability and financial success Demands a systemic approach and needs to be supported by a businessplatform and robust digital thread PLM or SCM is like the chicken and egg, must be more symbiotic, enablingcontinuous improvement A lot of work to do Copyright 2022 by CIM data, Inc.This presentation is copyright 2022 by CIMdata, Inc. Clip art may be copyrighted. Nouse, reproduction or modification is permitted without prior written permission.CIMdataâ is a registered trademark of CIMdata, Inc.28Page—14

The Sustainability ImperativeCIMdata 2022 PLM Market & Industry ForumFinal RemarksA critical challenge that offer significant business opportunities CIMdata believes that PLM is central to sustainability; industrials, ISVs, andSI/Reseller/VARs need to succeed together Virtually all PLM revenues leaders have significant efforts underway that seekto support both sustainability within their own organizations and to supporttheir customers’ efforts The three stakeholders are mostly aligned but there are some interestingdifferences in perception This is an existential challenge that also offers significant businessopportunitiesCopyright 2022 by CIM data, Inc.29To Learn More Stan Przybylinski, Vice President, s.przybylinski@CIMdata.com, 1.734.276.3088 CIMdata thought leadership white paper, available upon request CIMdata Webinar on sustainability Register to access the recording 50745422859 CIMdata industrial survey on sustainability in publication CIMdata ISV/SI survey on sustainability in publicationCopyright 2022 by CIM data, Inc.This presentation is copyright 2022 by CIMdata, Inc. Clip art may be copyrighted. Nouse, reproduction or modification is permitted without prior written permission.CIMdataâ is a registered trademark of CIMdata, Inc.30Page—15

The Sustainability ImperativeCIMdata 2022 PLM Market & Industry ForumCIMdataStrategic consulting for competitive advantage in global marketsWorld HeadquartersAnn Arbor, Michigan USATel: 1.734.668.9922Main Office - EuropeWeert, NLTel: 31 (0) 495.533.666Main Office - Asia-PacificTokyo, JAPANTel: 81.47.361.5850www.CIMdata.comServing clients from offices in North America, Europe, and Asia-PacificCopyright 2022 by CIM data, Inc.This presentation is copyright 2022 by CIMdata, Inc. Clip art may be copyrighted. Nouse, reproduction or modification is permitted without prior written permission.CIMdataâ is a registered trademark of CIMdata, Inc.31Page—16

CIMdata Sustainability Survey for ISVs/SIs et al. How are solution providers and SI/Reseller/VARs responding to these requirements? . Siemens Digital Industries Software 2022 CIMdata Foresight Sustainability Research - ISV/SI. The Sustainability Imperative