Product design capabilities come to exchanges

In a step toward fulfilling the dream of build-to-order via the Web, PTC (formerly Parametric Technology) is pitching its collaborative design software to business-to-business trading exchanges in an effort to promote on-line collaborative product development.

Toward that end, Waltham, Mass.-based PTC has established its Windchill Netmarkets business unit, which will focus on selling the Windchill Netmarkets software to exchanges that want to bring efficiencies to complicated “design-chain” processes, usually involving many third parties, said Jim Heppelmann, executive vice-president and general manager of the Windchill Netmarkets unit.

The collaborative design process is a crucial one because “competitive characteristics and costs are decided,” which leads to bills of material, Heppelmann said. “This is where the real decisions are being made.”

An exchange can make this effort more efficient as well as give enterprises the opportunity to discover new suppliers that might bring a higher level of innovation to the process, he said.

PTC will help exchanges set up the Windchill application and will receive royalties from the subscription fees charged by exchanges, Heppelmann said. Exchanges will have to deploy the Oracle 8i- and Java-based software on high-end servers that support Dynamic HTML Web pages, Heppelmann said. “We are engaged in a number of public and private exchanges,” he added, predicting that Windchill will be adopted by six more exchanges by the end of the year.

One early adopter, based in Cambridge, Mass., is a B2B marketplace for the plastics industry that will be using PTC’s software as its infrastructure for product design collaboration. Buyplastics – which counts PTC and IBM as investors – is beta-testing two Fortune 100 companies, said Chuck Hoar, president of Buyplastics. After deciding that Windchill met its needs, the exchange decided to offer a customized version, called Product Sync, Hoar said. The exchange will charge monthly fees for the service, slated to launch in the fall, Hoar added.

PTC’s B2B collaborative efforts might cause enterprises to find more innovative suppliers, but it is more likely to provide venues for collaborative design that “reduce a lot of the friction,” said Lisa Williams, an analyst at Yankee Group in Boston.

“Personally, I would bet that it’s more like, ‘Why don’t we eat lunch someplace new?'” Williams said about the impact on enterprises and their suppliers. “I’m actually pretty optimistic about on-line collaborative design,” she said, predicting that more vendors of collaborative design software might enter the fray.

As for concerns about exchange-based product design, Williams said that most firms are already conducting design projects with controls that are “not exactly Fort Knox security.”