The Product Data Management Software (PDM) business, which started as a way to manage CAD (Computer Aided Design) files, is undergoing a significant transformation. A year ago, I shared my thoughts on the evolution of PDM, highlighting its shift from traditional file management to data-centric services. You can read more about that here: The Journey of PDM Evolution. Today, a year later, I want to revisit these observations and share new insights into the future of PDM and what might be on the horizon.

The Market: Three Categories of PDM Tools

After CAD vendors killed the PDM business a decade ago by acquiring complementary PDM tools for each of their CAD systems, the prospects for the PDM business appear bleak. However, I can see some interesting dynamics. Let’s talk about current market groups for product data management. Currently, I see three distinct groups of tools in the PDM market, each focusing on managing design data and engineering processes:

1. CAD Vendors with PDM Systems: These are traditional desktop-based CAD systems that come with their own PDM solutions. They are deeply integrated with existing design tools but often inherit the complexities and limitations of desktop software. Examples of tools in these groups are Autodesk Vault, Dassault Systemes SOLIDWORKS PDM software, Siemens Teamcenter, PTC Windchill, and some others.
2. Cloud CAD Tools with Embedded PDM Services: This category represents the new generation of CAD systems. Cloud-native and seamlessly integrated, these tools offer PDM capabilities directly within the design environment, simplifying processes for teams already leveraging cloud technologies. Examples of the tools hear leading by Autodesk Fusion, PTC Onshape, 3DEXPERIENCE Platform.
3. SaaS Tools Supporting CAD Data and Engineering Processes: These tools target companies that haven’t fully embraced traditional PDM systems or new cloud-based CAD solutions. They provide cloud-based data management and supporting engineering processes for teams that are still navigating their transition from older methods. Here are some examples of tools in this Colab Software, Five Flute, OpenBOM Design Projects, Get Build. A good place to check for a large number of new tools and startups in the engineering space is the Blake Courter’s Engineering Software Moat Map.

While all three groups aim to streamline engineering releases, the third group is especially interesting as it targets organizations that have yet to adopt a fully cloud-based solution but are moving away from the constraints of traditional PDM.

Future Trajectories in the PDM Market

What can expect from product related data tools supporting CAD software – PDM system space and tools supporting engineering development process, reuse existing design data and version control to manage product data. Looking ahead, I see three key trends shaping the future of PDM:

1. Expansion of Cloud CAD and Integrated Tools: Cloud CAD tools and PDM solutions integrated with complex design systems will continue to expand their capabilities. These platforms will become more sophisticated, supporting intricate design processes, deeper integration with engineering systems, and enhanced collaboration features.
2. Commoditization of Basic File Storage: Pure CAD file storage and basic data management tools are on their way to becoming commodities. As more advanced solutions emerge, these simple tools will see their prices drop as companies seek more robust and integrated systems.
3. Growth of ‘Near CAD’ Services: A new class of tools, which I call “near CAD” services, will emerge to support engineers beyond simple file management. These tools will help teams navigate the increasing complexity of multidisciplinary engineering, design collaboration, supplier management, and decision-making (including cost analysis, sustainability, and automation). These services will allow engineers to work more efficiently while maintaining focus on core design tasks.

Challenges for Vendors

As these trends unfold, vendors will face several key challenges:

1. Fragmentation of Tools: As the number of tools and, especially cloud SaaS tools, the market will flooded with tools, leading to fragmentation. Vendors must navigate this by offering more integrated solutions that simplify workflows and reduce the need for multiple disconnected systems. Large vendors will continue to push their ideas of single platform and full vertical integration. At the same time, vendor own multiple overlapping tools (eg. Autodesk owns 3 PDM/PLM systems, DS owns at least 3 PDM systems, PTC has 3 systems, etc.)
2. Maintaining Legacy Systems: Many customers are still using legacy PDM systems, which are difficult to upgrade and maintain. Some of them are also hosted these days. Vendors will need to find ways to support these systems while encouraging users to transition to more modern solutions.
3. Demand for Simplicity: As systems grow more complex, the demand for user-friendly tools that streamline processes without overwhelming users is increasing. Vendors must focus on delivering solutions that are not only powerful but also simple to implement and use.

Challenges for Customers

On the customer side, several challenges also persist:

1. Selecting a Single Tool for Multiple CAD Systems: Many companies use a variety of CAD systems, making it difficult to select a PDM solution that works across all platforms. The need for tools that can integrate and support multiple CAD environments is crucial for long-term efficiency.
2. Integrating Multiple Data Silos: Customers are often dealing with fragmented data spread across different systems, making integration a significant challenge. A future-proof strategy must include seamless data integration and management.
3. Managing Legacy Data and Planning for the Long Term: Many companies still rely on legacy data and processes, making it difficult to transition to new tools. Customers need a clear, long-term strategy that includes migration paths and support for legacy data while embracing new technologies.

What is my conclusion?

The old PDM paradigm is slowly disappearing, even though many customers are still clinging to document and folder-based systems. Most companies are now exploring their options, trying to figure out the best path forward. The gap between traditional PDM and the future of design data management presents a unique opportunity for vendors. There is significant value to be found in offering “near CAD” services—tools that enhance engineering processes without being tied directly to CAD platforms. These services can fill the gaps and offer companies the flexibility and power they need to succeed in an increasingly complex design landscape. Stay tuned for more development as the journey continues.

Just my thoughts…

Best, Oleg

Disclaimer: I’m the co-founder and CEO of OpenBOM, a digital-thread platform providing cloud-native PDM, PLM, and ERP capabilities. With extensive experience in federated CAD-PDM and PLM architecture, I’m advocates for agile, open product models and cloud technologies in manufacturing. My opinion can be unintentionally biased.

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