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IBM Goes Up Against Oracle, SAP In Product Lifecycle Management


IBM rarely competes directly with Oracle and SAP in ERP applications. But that's changing on one front: product life-cycle management. With PLM's heavy emphasis on data transfer and data management, the technology plays to IBM strengths and gives it a toehold versus SAP and Oracle.

IBM on Jan. 8 announced it's partnering with UGS to deliver a slenderized version of UGS's core product, Teamcenter Express, for small and midsize businesses. Teamcenter is a market leader in a subset of PLM: managing collaborative product data used in the design, manufacturing, and delivery of a new product.

The need to get different teams to share information and work together is a key part of getting a product to market quickly and continuously improving it over its life cycle with customer feedback.

Though announced yesterday, the agreement between the two companies already has been in effect for 45 days. China is a key focus for the Teamcenter Express offering, and IBM sales representatives will be presenting the product in China and Japan. It also will be available to small and midsize businesses in Germany and France and in North America. "This means small businesses will be able to get their products to market faster and speed up their flow of revenue," says Kerry Grimes, VP of UGS's global channel sales.

The Teamcenter system competes with an Oracle PLM product launched in mid-2003 and an offering from SAP. IBM is eager to market Teamcenter Express because it often generates a demand for IBM's own WebSphere middleware and data translation products.

PLM for the most part has been a concern of large companies with complex products enjoying long shelf lives. UGS Teamcenter, for example, is the tracking system for the Lockheed Martin F-35 Strike Fighter aircraft, with hundreds of suppliers and partners.

If the IBM-UGS partnership is a sign of the times, small and midsize businesses with complex products want the benefits of collaborative product data management as well.

The UGS partnership is the latest in a series of moves by IBM into PLM. In 2004, it bought Trigo, a software startup that offered a system to track product data as it moved from manufacturing through the supply chain to market. In early 2006, IBM agreed to market PTC's product data management software in China, as well as target it to the electronics and consumer packaged goods industries in Europe and the United States, according to IDC analyst Gisela Wilson.

IBM and UGS will evenly split marketing expenses for Teamcenter Express and supply a connector to Catia, a well-established computer-aided design system for manufacturing from Dassault Systemes. The connector opens up Dassault to new competition. IBM previously had a near-exclusive agreement with Dassault. Likewise, the IBM-UGS agreement opens up IBM's existing ERP partners to competition from Teamcenter Express.

"This part of the agreement could open the door for UGS into the SAP installed base," predicts Wilson. The agreement provides "a tough challenge for SAP," since SAP is IBM's oldest ERP partner and competes directly with the Teamcenter product line, she wrote in an analysis of the agreement.


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