New technologies like cloud computing made all-in-one platforms possible for SMBs, but large companies in complex industries such as manufacturing still need to use multiple systems, often delivered by separate vendors. This has made it difficult for manufacturers to rely on only one product that can truly manage the entire lifecycle and production of a product.
Even though major players like SAP, Oracle, or Infor offer products for all departments of a company (from accounting and procurement to sales, marketing, and operations), these solutions aren't always the best options for all companies. Since companies can have very different needs, providing functionality for every type of business is impossible. Therefore, the best way to deliver end-to-end solutions is through partnerships between vendors.
SAP and Siemens to create end-to-end industrial solutions
SAP and Siemens recently announced that they are partnering to provide "integrated end-to-end software solutions across product lifecycle, supply chain, and asset management." Even though SAP sells product lifecycle management (PLM) solutions, the vendor will offer Siemens Teamcenter as "the core foundation for product lifecycle collaboration and product data management."
At the same time, Siemens will provide its customers with SAP Intelligent Asset Management and SAP Project and Portfolio Management solutions. It is not yet clear if the partnership will extend to Siemens' Xcelerator portfolio of digital transformation applications, which includes MindSphere, Siemens Cloud Solutions, Mentor, and Mendix.
Supply chain management usually refers to logistics activities such as transportation and inventory management, which are disconnected from production and product design. SAP's supply chain management products will integrate with Siemens' production management products in an attempt to make the supply chain even smoother.
Internet of things (IoT) can only be beneficial when it connects devices and manages data during all stages of the product lifecycle. This can be delivered through the partnership using a "digital thread”, offering a holistic view of product data across all the stages of its lifecycle.
Other than technology, industrial companies need the expertise to improve business processes and collaboration across teams and multiple locations. Both SAP and Siemens have a proven track record of delivering solutions for complex industrial projects.
Partnership challenges and the way forward
One of the significant challenges of this new partnership is that many manufacturers may not want to rely mostly on SAP and Siemens technology; especially those that already have systems in place in various combinations such as multiple ERP and PLM solutions from different vendors.
The ideal end-to-end platform should be vendor-agnostic, which is impossible to achieve at this point. We hope that SAP and Siemens will extend their offering to include other major ERP and PLM players, which would give companies more options to choose from.
Gabriel’s background includes more than 15 years of experience in all aspects of business software selection and implementation. His research work has involved detailed functional analyses of software vendors from various areas such as ERP, CRM, and HCM. Gheorghiu holds a Bachelor of Arts in business administration from the Academy of Economic Studies in Bucharest (Romania), and a master's degree in territorial project management from Université Paris XII Val de Marne (France).