The Future of Product Development: A Panel Discussion with Onshape, Arena & Industry Leaders

Markus Fleckenstein

Hello, good afternoon. My name is Markus Fleckenstein, and I’m happy to welcome so many participants to today’s webinar about the future of product development. Luckily, I’m not alone today, so I’ll have some great colleagues with me that will introduce themselves later on in detail.

Just to give you a little bit of a teaser, I’m happy to have Jon Hirschtick with me as our Chief Evangelist at Onshape. I have Ran Peled, the Head of Design from Skarper, and Liran Vaintrov from Kornit Digital. Looking forward to have a great conversation with all of you over the course of the next hour.

Maybe just a little kind of housekeeping information for everyone online. If you have any questions, we can’t open your mic, but we have… there’s a comment section where you can ask questions, so if you want to have something answered, if you have some information to share, feel free to use the comment section and we will try to address it either directly on the conversation or afterwards in a short Q&A session.

That brings me perfectly to the agenda, though. First of all, I would like to really give you just a very short introduction on who is the host today from a PTC and Onshape and Arena perspective. Then, we will continue with the live panel discussion and, as mentioned, any questions, please put them in the comments area.

Happy to address them at the end or if they fit in between on our discussion. Just as I said, just to set the scene a little bit, kind of, who is kind of organizing that and kind of where you’re joining currently, so I’m Mark Fleckenstein, as I said, and I’m with Onshape and Arena for quite some time, at PTC in total about 14 and a half years almost. Most of you might know PTC maybe from kind of the pro-engineer days back in the ‘80s, ‘90s, but PTC overall grew, and you could see just from the fast fact that we have here, with about 7,000 employees and with a very broad product portfolio.

Our focus today, and basically kind of the organization of that webinar, is related to our two cloud-native solutions that we have. As in PTC, there is on the one side you can see Onshape has the fastest growing CAD and PDM system in the market, where we have a seven times the professional market growth and a lot of yearly education signups, so really trusted by so many companies from just small engineering offices to large corporate organizations.

On the other side, you can see Arena as a PLM cloud market leader with almost 1,500 customers globally, which is a PLM and QMS on a single platform, which allows you to really actively collaborate between different disciplines. You could see there is a lot of supplier logins as well, though. That means that both systems are really built for collaboration and built for kind of also including your supply chain and the whole processes. While Onshape itself is, let’s say, focused on eliminating file-based CAD issues and all the kind of the pain sets that come with it.

You have an infinite restore or, let’s say, you have automatically a built-in PDM with some cool functionality like some of you might know from the software industry about branching and merging, all the way is through that it’s easy to maintain because you don’t need any IT because you don’t need any infrastructure because it all runs on a browser and, therefore, runs on any device.

With that, kind of the whole modern architecture you are able to collaborate like no other and you don’t have that pain of crashes. This all comes with an incredible low cost because you don’t need powerful CAD machines. You could run this on basically a very simple laptop, and even on tablet and iPad, as this is indicated here by the “runs on any device” bullet point in here. On the other hand, there is Arena, as said, which is then kind of bridging basically the gaps that could occur with data and processes.

The idea of Arena is that it is your PLM that sits in the middle between your engineering design systems on the left, which could be Onshape, and on your manufacturing execution system or ERP systems on the right. It connects all the relevant disciplines together from engineering to suppliers, as mentioned, to contract manufacturers to quality and purchasing operations—whatever is required to work together and to share information, share data, and making sure your whole product information is represented in a correct way.

For sure, those two go nicely together. There is the connection between Onshape and Arena that really allows you to perform HR product development. Nevertheless, it’s fair to say that there are many customers of Onshape out there that don’t use Arena at the moment, so Onshape can, for example, connect directly to an ERP or also connect to other PLM environments.

While on the Arena side, there are still many customers that are working with SOLIDWORKS or other CAD environments and are connecting their SOLIDWORKS environment, for example, with Arena to making sure that the data is then transferred from there into the PLM in a proper way.

For sure, in an ideal world, we would love to have everyone working together with Onshape and Arena, but as this is a path that probably might take some time or that maybe not fits for everyone because you need to connect Onshape directly with the ERP. There’s a lot of openness that allows you to also work in a different way.

That’s all that I wanted to kind of have from an opening perspective in here, so thanks for your attention to my intro slides here. Now, I’m happy to welcome my colleagues here onstage for first, a formal introduction, and also for hopefully a very fruitful discussion that is meaningful to all of you.

Before we jump into that discussion, maybe we could really do a… We kept it very short on the slide, maybe do a little round of intros here, just kind of your role in the company, your background. I’m not sure if you really need to introduce yourself, Jon. I assume most of you will know, but for those who don’t, I think it would be appreciated if you could maybe kick it off with a short introduction from your end.

Jon Hirschtick

You want me to go first here?

Markus Fleckenstein

Yeah, sure. I just want to …

Jon Hirschtick

Okay … Jon Hirschtick. I’m currently Chief Evangelist here at PTC. I’ve been building CAD and PDM and related software for 44 years. I started as an intern in the field. I was the Founder and longtime CEO at SOLIDWORKS and left and then founded Onshape, where I was Co-Founder and longtime CEO at Onshape.

Then, we were acquired by PTC five and a half years ago. Wow, time flies by and we’re having a great time as part of PTC, and my job as Chief Evangelist, I try to work with our customers, our team, and our partners in the greater world to influence our team to build better and better solutions for our customers, but I don’t run it anymore. I just give advice.

Markus Fleckenstein

Fantastic. Thanks, Jon. Ran, do you want to go next? You don’t mind?

Ran Peled

Yeah, of course. First of all, thank you for having me here today. It’s great to sit with you guys. I’m Ran Peled. I’m originally from Israel. I’ve been living and working in London for the past 10 years or so. I’ve been at Skarper for the last five years from the very early beginning of it as Head of Design, Head of Product.

If anyone that doesn’t know Skarper, we’re a company developing a first-of -a-kind click-on e-bike motor for electric bikes. Before that, I’ve worked with early-stage startups as a part of a hardware accelerator here in London, as well, and did some software work before, as well.

I am a strong believer in user-centered design and trying to create cross-functional team collaboration within the company to create innovation and solve people’s problems.

Markus Fleckenstein

Fantastic. Thank you, Ran. Liran?

Liran Vaintrov

Hi, everyone, and thank you, Markus, for this opportunity. I’m Liran Vaintrov, currently working for Kornit Digital. I’m the PLM and the ERP Business Analyst. In the last 10 years, I’m working with the PLM systems beginning as a customer, and now as the admin side.

Regards Kornit, Kornit is reproducing digital printing technology for clothes, fabrics, and also the ink for those systems.

Markus Fleckenstein

Fantastic. Thank you all for the short intro and appreciate that you spend an hour with me here today to discuss about product development. Maybe we can directly jump in to kick us off if we can maybe try to explore a little bit how product development has evolved in the recent years.

I know this might be probably a little bit more than an hour in total, but maybe we can start there. Maybe start with you, Jon, again. Maybe from your perspective as someone you already said who pioneered CAD innovation, what major shifts have you seen in how manufacturers approach design and development today?

Jon Hirschtick

Well, I think it starts with the world around product developers and manufacturers. This is what’s happened in the world. We all operate in the world. There’s been enormous changes, and the changes I hear the most are one: more than ever, there’s a pressure on speed. There are zero… I meet a lot of customers, I visit a lot of customers, visited one yesterday and visiting one tomorrow. What I hear from them is zero customers will say, “Oh, we have more time now than we used to, Jon.” Everyone has less time and it’s not just less time; there’s more volatility in the world.

They have to respond to change. Obviously tariffs, wars, politics, pandemics, supply chains are disrupted whether you want to change or not. The availability and pricing of raw materials, the availability, the prices you can charge for your own products where people are working, where you’re producing, it’s a world of change around the product. They’re facing time pressure, innovation pressure because innovation is more competitive than ever. You need to be updating your products more frequently. You have more and more competition.

Anyway, a very volatile situation. As a result, I think we’re seeing people change their process and changing their tools, so process and summary, you hit the nail on the head with your slide, Markus. An agile process is what people want today. They can’t do the old waterfall process for two years because no one can assume anything’s going to be the same two years from now. We’re seeing that. I’m seeing a lot of use of tools, of course, cloud-based tools. Hey, that’s what we make, cloud-native tools, but I’m not just talking about the tools we make, I’m talking about the other tools the business uses, things, other tools coming in.

I’ll elaborate on that, and then AI, of course, in everyone’s mind is another tool. Cloud tools are one, AI tools, which go hand in glove with Cloud in my opinion, are on people’s minds and certainly on our minds. We can elaborate on that, but that’s some of the highlights I see.

Markus Fleckenstein

Fantastic. Thank you for finding that out and maybe just from your perspective as you speak with a lot of customers, maybe dig into one specific, maybe Liran from your experience at Kornit Digital, so what are the biggest challenges that you or the manufacturers in general kind of see when it comes to complex products and processes?

Liran Vaintrov

Actually, before we had the right tool, product data was spread out to different places. There were a lot of problems with version control, tracking changes, and keeping everyone on the same page, and this caused a lot of mistakes and slowed down their work.

Currently, I think we found the right tool to work with—Arena—to have such same place for everyone to speak on and to have on the same page. Regards to the changes, we got the item revision control and stuff, and that’s it.

Markus Fleckenstein

Okay. Yeah, thanks a lot, Liran, and maybe handing this over to you as well, Ran, kind of as the design leader, I mean, how have your team approached innovation and collaborations to bring your products from concept to market? I think you’re currently in a go-to-market phase and ramping up.

Ran Peled

Yeah, we are. It’s just the right time now when everything is starting to scale up. I think since the beginning, Skarper has really kind of, in terms of innovation, put the focus on users first and trying to really define the problem well to know how to develop.

Once you’ve defined the problem, you need a strong team that collaborates internally and almost seamlessly. I think what was actually done with Onshape is quite brilliant because that, I can’t say that what drove it, but we are now working almost like a software team.

We do stand-ups, we do retrospects, we do everything you would expect from a normal software team. Our timeframes are slightly longer because things take time to make, but that collaboration really enables innovation, it enables rapid development, or more rapid than it used to be in the past, and it just gives you a lot of flexibility.

Markus Fleckenstein

Do you mind if I ask how many people are currently collaborating actively in your current project?

Ran Peled

We’re about 20 people end-to-end hardware/software design, so it’s not a big team, but we are quite spread across the world, and we’re working with contractors that we’ve been able to onboard Onshape as well. That’s been super helpful in bringing everything in one place. I think what Liran said was also quite a key aspect of file management. That’s quite a big admin overhead that you really have to have and you have final final and final final last version and you have all those files. Onshape just takes it away and you can work in parallel in branches and still be able to merge and collaborate almost seamlessly in most cases.

Markus Fleckenstein

I think we all went through that folder structure, that final final and.

Jon Hirschtick

Yeah, final final, and people, if I can elaborate, I’m hearing themes like “everyone access to a central place” for the data. Well, this is an idea that’s been around since paper. I was in the industry when we used paper, so what’s new?

Well, to me the issue is, first of all, who’s “everyone”? That changes every day. It used to be you’d say, “Well, who’s on the team?”, but these days new supplier, customer needs to look. Maybe we’ve got a contractor, and that comes and goes. That’s where something like Arena, you’re able… I know from Arena customers I talk to, it’s so nice that they can have a fluid team and the definition of “everyone” changes every day. Arena is going to respond to that very well because you’re not dealing with weird VPNs and installs.

The other thing I think is important is you’re not dealing with copy-based workflows where you have a copy that is supposed to be the official one because then no one knows. Like you’re saying, this really final final, and the copies stemmed from the lack of real-time data, and what we’re seeing now with systems like Arena with Onshape, and not just those, with Slack, with Google Docs, with Asana, with NetSuite, with Workday, these aren’t just limited to design tools.

You have the data, a master database that’s up to date in real time, and there are no copies, and everyone can come and go because you’re not installing tools. You can get everyone, each day, different people can be given access or removed, and there’s only one place to look for data, no copies.

The news is that instead of trying to figure out which copies go into Master Vault and how to get who has access, it’s like everyone can do that. We can work fluidly in real time. A customer yesterday was talking, and they showed me an example of a problem that got resolved through real-time collaboration in nine minutes using commenting in real time. They said, “This would have taken a day before because we’d email the file around. Is that the right one? Are you editing MI? What’s the copying like? Have we checked our master or whatever for someone else making changes?”

Well, that doesn’t happen anymore. They can move, move, move, and that difference between a few minutes versus a day is a big difference and adds up.

Markus Fleckenstein

If I get this right, that is kind of the core role why Cloud is so important specifically for global distributed teams? Or do you think there is another aspect to it as well?

Jon Hirschtick

I’m sorry, are you asking me?

Markus Fleckenstein

Yeah, can you … elaborate on collaboration and Cloud … earlier, like just as a follow-up on that?

Jon Hirschtick

Yeah, it’s global distributed teams and it’s also when teams are sitting next to each other in cubicles. It’s like it’s either way, and a lot of teams one day are next to each other in cubicles, and the next day they’ve distributed or they’re working with distributed partners, or they don’t know where they’re going to be next week.

They might have to be out on-site with a supplier, but yeah, it’s people expect a global real-time data source for running their business. That’s the norm in all other areas besides engineering, like accounting software, human resource software; of course, it’s a real-time database.

Markus Fleckenstein

Right. Right, and there’s a lot…

Ran Peled

I have to say like…

Markus Fleckenstein

Oh, I’m sorry.

Ran Peled

It’s okay. Sorry. That’s okay. Completely agree. As in our team culture is very flexible. You can one day work remote. This works around your life and that really gives people ownership, but whether it’s that or we just work in the same room, the ability to work on the same file, I’m doing some design stuff, maybe I’m adding details here, the engineers are changing the gears.

Things are happening at the same time on the same file and then merged into the master. That was kind of a game changer for us and sped up all the processes quite dramatically.

Liran Vaintrov

Not just that it’s a good example, Ran, but also the supplier collaboration in Arena, for example. For me, it’s a game changer in terms of what they had in Agile, for example. Currently, suppliers could enter the system, review changes, approve, have comments, have implementation notes inside the system. It’s great tool.

Markus Fleckenstein

That means you could also kind of confirm that collaboration at quantities.

Liran Vaintrov

Yes.

Markus Fleckenstein

Fantastic, fantastic. Anything kind of… Any advice you could give to manufacturers if they want to modernize their product development process from your side, Liran?

Liran Vaintrov

That’s where the problem today and pick tools that fit your needs and connect well with your current system. Focus on one source of true data, simplest as much as possible to workflows and making sure teams are actually using those system as you planned, actually.

Also, tools are important, but clear processes and teamwork are just as critical.

Markus Fleckenstein

Okay, good point, good point. I mean, implementing new tools or new solutions is always kind of a challenge. Maybe, Ran, if you could elaborate a little bit, did you face any hurdles in aligning your design and operations team with this new way of working? Or is it because you came from the startup thinking you were always in an Agile way?

Ran Peled

I can’t say we were always in working in an Agile way, but it did start early on. I think maybe six months into starting development we started with SOLIDWORKS. I think Onshape just popped up in one of our engineer’s head. It started with something funny like he wanted to use a Mac and not a PC…

Jon Hirschtick

Imagine…

Ran Peled

But…

Jon Hirschtick

…that.

Ran Peled

Yeah. I mean, our team… is working on Macs now and it all works seamlessly, so that’s one side of it, but no, I think it’s just so early on the advantage of working on a cloud base where you don’t need to upgrade your PC every two years because the specs have run out and you don’t need to buy a new license every few years.

Just the computing power that you might need that is offloaded to the software itself was great. I think, look, what we’re seeing is what probably every team sees in terms of kind of the hurdles in getting into manufacturing, which is communication issues that time.

Different teams, different disciplinaries speak a slightly different language almost, and everyone sort of has a different perspective of how things should be. I think things that helped us is, A, at some point there was an understanding from the operation side that engineering will take whatever it takes.

I think going back to Jon’s point from the beginning, I’m not sure if we had the opposite. I think we still want to go fairly quickly, but we understood it’s a completely new-to-market product. Some things are new, and you have to take your time to get it right, but over time what we’ve done is what I’ve described earlier, split into multidisciplinary teams like Agile, Teams, software, the kind of general routines of stand-ups, back-up refinements, et cetera.

Wherever needed, we developed an approval process that included Onshape in it. We have a confluence page with formal approvals with links to Onshape so everyone can view and approve apart from the official Onshape approval that that’s more on the kind of engineering side, but everyone then can be aligned and what’s going on and what’s going to manufacturing, which is super important.

I think Jon mentioned correctly it’s not just Onshape. We use Confluence and Jira. We use Miro. We use all the Google tools and all of that help us to kind of almost be a completely cloud-based company and do the collaboration seamlessly. The other thing I think is a bit off cloud topic, but we did start at some point doing a bi-weekly lunch and learns. We just gather the entire company, sit down, and we teach each other about different aspects. It’s either commercial updates that product team is not always aware of, or it’s our senior software engineer describing how the software architecture is built so we can learn from each other on how things work and basically try to communicate better.

The tools are helping, but as Liran said, processes and just kind of the personal connection is key, is what we’ve seen it.

Markus Fleckenstein

Okay, yeah, that makes sense. I think tools are that will support you, but it doesn’t eliminate personal communication and exchange. I think that’s very important, a very great point. Good to point that out. I like the idea of the lunch and learn and kind of really getting everyone together and share all the information.

How do you see that at Kornit, Liran, from a kind of… Did you face any hurdles? I mean, you came from a PLM world already, but any kind of to help people implement that or aligning the teams?

Liran Vaintrov

We had, and as all companies have, facing kind of issues some of the time like a collaboration between mechanical team to engineering team, but eventually as you have a central PLM system and also as the mechanical team are using in Kornit, they’re using SOLIDWORKS, using the integration into the system.

Eventually the streamline is going to one centralized PLM system, was not like this before, so might be that there are glitches between two systems and the interface. Eventually once you have a centralized place to pull out all the information and to have an approval flow for all the change orders, including a real discussion between the collaborators, then you have the place to lay out all the information that you need, all the ideas.

Eventually, once it’s approved, it approved, then fine version is approved, and then it’s go inside of the ERP system and get to the manufacturing.

Markus Fleckenstein

All right, thanks. Thanks, and maybe Jon, from all the hundreds and thousands of customers you are talking to, are there any kind of common hurdles or anything to keep in mind when you want to align your design and operation teams? What do you recommend?

Jon Hirschtick

You mean common hurdles? Well, one thing it’s always, it’s about change management these days, and I wanted to make sure we talked about that, and AI is forcing this big time. Cloud tools is forcing it, the change in process.

When you look at change management, what happens is people are sometimes very reluctant to change because, first of all, the processes and tools people used in the past worked. Paper worked. Somehow the pyramids were built, I don’t know how, but they had a process that worked, but we don’t want to go back to that.

We don’t want to go back to paper, and so somehow changes eventually happen, but what happens is people tend to, very commonly, they overestimate and understand thoroughly some of the pain points that’ll happen. “We’ll have to change UI, we’ll have to move the vault to a new place.” Or something like that. They underestimate the improvements they’ll get. They’re like, “Well,” they tend to look at what’s familiar and they think, “Well, whether it’s looking at cloud tools, well, sure we could use Arena for PLM, but will it allow me to name folders the same way I do it in Microsoft’s file system?”

Which are dumb questions, but I hear it. Or, “If we go to the AI tool, what about all those errors?” Well, of course, AI makes errors, but if you don’t use them, you won’t discover the power. I think when it comes to manufacturing, you look to the older employees, the more experienced ones for wisdom, because they know the ins and outs of how to get a molded machine part made.

When it comes to digital tools, you got to look at the new people entering the workforce. They understand the benefits. They understand the benefits of Cloud. They understand the benefits of AI. They’re using AI more than the established. In fact, they use AI so much, they don’t even find anything remarkable about it. They use Cloud. Real-time collaboration is what they expect. A lot of the attendees of this webinar will go, “Real-time collaboration? What’s that? Do we need it?”

If you’re a college student, you expect that. You’ve played video games your whole life. You use Google Docs. How else would it work? Anyway, change management, look to the emerging workforce and really try to understand the benefits. Don’t frame a look at a tool like Arena or Onshape or, for that matter, Smartsheet or Monday or Mira or… It used to be Jira. Now Jira is pretty accepted. Don’t frame those tools through the lens of some old system you used, and looking at minor features.

I don’t know if that makes sense. I see that a lot. I have a call scheduled later with a customer and they’ve sent me a list of features, and I feel like telling them, “Hey, we’re better on these features, but who cares? I want you to look at a bigger picture than these little micro, nitty things they’re looking at.”

“I want to help your business. I want to help you build better products and do it faster. We can make a big impact on that.” Anyway, you got to look past. The other thing I’ll say about change management is you have to pick the right time in the process. You can’t walk into a company and say, “Change to Arena today.” Today may not be the right moment to change to Onshape or Arena. You have to choose… This is change management again, is, when is the right time in your process to consider introducing a new tool?

You need to time that. Maybe use it on some new projects, keep the old projects on legacy tools. Maybe you wait until you’ve finished with a critical early manufacturing stage so you’re not changing too much at once. Pick the right moments and the right ways to introduce new tools. Look for the big benefits.

Markus Fleckenstein

Yes, fully agree. I think specifically, I mean, as we have kind of ran with Skarper, coming from a scaling up at the moment, and then Kornit with their established processes, so there might be different scenarios how and when to implement, for example, a PLM environment I could imagine, so to either, I mean…

I had a friend that had a nice kind of picture. They always say like there is just two good moments to plant a tree. It’s either 20 years ago or now. That means you really need to make clear when you want to… make sure you establish the right things to get the most benefit and the value at some point, at some point. Fully agree.

Maybe at that point, just briefly for the audience, if you have any additional questions that I’m not asking, feel free to put them in the comments and we’re happy to address them and weave them into the conversation in here because I think we all want to get as most out of the conversation as possible.

Feel free to ask your question as well. As I just mentioned was the two difference in how the companies are established. I mean, looking at you, Ran, how do you compare your scaling business and the challenges you have if this is doable from your outside perspective?

Together with what Liran described earlier about the processes and so on, is there anything, what you would say this is completely different? Or even if you’re in different stages in the company and this is exactly the same, is there any kind of tool thing you can elaborate on?

Ran Peled

I think, look, we were quite lucky to pick up on the Cloud, even a trend on the cloud wave very early on. We were able to implement most of these almost from the start of Skarper. We had a few months on SOLIDWORKS and then we moved on and we found a way.

We broke Onshape quite a few times until we find how to work with it correctly, and since, it’s working. Well, we didn’t break Onshape as in the server didn’t crash …

Markus Fleckenstein

Oh.

Ran Peled

…but it worked for us and I think, yeah, I think as a startup you just try to get what you can work with. We’re quite flexible on the tools we use for different users. There’s no taboos on anything and we just allow ourself, I think, going into manufacturing and scaling up. You need to start, and we’re seeing it as we speak, you need to start getting more healthy processes to avoid mistakes, but you’re also as a small startup quite limited to what your manufacturers are willing to do.

You’re only making so much and you’re only a small fish until you become this massive multitrillion-dollar company in the next few years, hopefully. Then, you need to be flexible enough to work with what you get given, but also produce the best out of it. I think it’s probably slightly different, but we’re seeing similarities.

Jon Hirschtick

Yeah, I think you raised a great point, which is in terms of the expected transition, transition needs, and the benefits you’re going to achieve, you have to think about changing how you work. You are going to work differently.

If you buy Arena or you buy Onshape and you just use it to work in exactly the same process you did before, I think you’re missing out. I think it’s about enabling new process. It’s probably not a good idea to do that. Like I was saying earlier, if you just look at some minor feature changes and you say, “I want to keep the same exact process,” the whole point is you work in different ways.

By the way, I’ll apologize, it does take thought and effort to make the move to Onshape because you think differently. You think differently about how to organize your work, how to do release management, and there’s new flexibilities you didn’t have before where you say, “Hmm, which way is best?” Takes some thought for sure, and AI, I hope we’re going to talk AI a little bit because it’s so exciting these days and so full of hype. Markus, can we talk about AI a little bit?

Markus Fleckenstein

We can definitely talk about AI. I just wanted to make sure we talk about the product first, but I don’t want to …

Jon Hirschtick

Yeah.

Markus Fleckenstein

… your.

Jon Hirschtick

Okay. Well … I think I’m ready for this …

Markus Fleckenstein

AI. Happy to go over it …

Jon Hirschtick

Well, I was thinking … about this. AI is going to be another process changer for people. It changes. It’s already changing. I mean, everywhere I go, so many customers already using AI with our tools, and we’ve shipped our first AI tool to Onshape users in our Onshape AI Advisor.

All users have access to it, getting a lot of good feedback. We have a lot of exciting directions we want to take that. I know that throughout PTC, the Arena team and everyone else has lots of AI projects. I think the advantage of Cloud is pretty obvious for data and compute and also release cadence, the idea that we can release software faster than the non-cloud tools and they can be adopted faster.

I mean, you can have great AI features put into an installed product, but if it doesn’t ship for a year and a half and then it takes your organization a year and a half to upgrade, well, that’s a long time, and that’s typical for installed products.

For Arena and Onshape, when we ship it, all the customers get it or will get it right away and we can more quickly iterate and more quickly deploy. Big advantage in the world of AI. I also encourage customers to look beyond the sort of obvious overhyped applications like saying, “Hey, will the computer design your whole product?”

Well, I don’t particularly see that, but I see tons of great use cases across the board like we’ve already introduced in advising on complex use situations, in areas like CAM and PLM and PDM and release management rendering. We think that there’s so many and even smaller convenience features helping you finish a model, helping you finish a sketch. I’m not promising any of those, by the way. I’m saying that these are things that we’re thinking about and exploring. I see lots of promising applications in a very diverse array that is not just about, “Hey, computer, will you do the whole job of the engineer?” I think we’re a ways away from that.

Markus Fleckenstein

I think there is kind of a path for what we currently see as generative AI with images and text, that we see something that is kind of more closer to the engineering in CAD?

Jon Hirschtick

Do I? I would say there’s a lot we can do for engineering in the domain of images and text, first of all, that we’re working on, and a lot of it. There are people working on 3D AI engines and there’s various startups doing it.

I don’t believe we’ve announced at PTC anything we’re doing. I’m not saying we’re not. I’m just saying we haven’t talked about that publicly, but there are certainly plenty of startups talking about and showing it. I have not yet seen really compelling actual use cases as we’ve seen in text and images, but they’ll be coming.

They’ll be coming. It’s all good, all exciting.

Markus Fleckenstein

Yeah, I’m pretty excited to see what’s coming next there, definitely. Is AI a topic for you guys as well, Liran or Ran?

Liran Vaintrov

Yeah, AI, it’s a big word, but as Jon has just said, we will not be replacing all just immediately with AI. We need some baby steps to take here, so we need to first ask the real questions.

What can we do with automations that does currently today? Users are wasting a lot of time and effort by doing some black jobs like, for example, just what Arena does started working with as a supply chain.

We want to evaluate a risk for a bill of material that we having. Currently, we need a full-time job for a company engineer to do so, to review all the BOMs, get the information from any data source, et cetera, collect it, bring it to the system.

Currently, it doesn’t click. It’s very simple, but it’s effective. It’s saving a lot of time and effort for the engineering department. Of course, this is just the first step in Arena, and I believe and hope that Arena will eventually add more and more tools like this one to support also validation, automations, and so on. Eventually, it will be you will have a PLM embedded with an AI, and not just you need to go to ChatGPT or any other AI in the Cloud to perform your work.

Markus Fleckenstein

Yeah, I think specifically as you want to keep your IP in-house, you don’t want to feed them into ChatGPT.

Liran Vaintrov

Yeah, for sure.

Markus Fleckenstein

There, I think it’s important. Ran, how is it from your end, about, is AI a topic? I mean, you talked about so many modern tools, so I assume for sure…

Ran Peled

Yeah. Can you avoid AI nowadays? I don’t know if you can even if you try to. It’s definitely a topic. I share Jon and Liran’s thinking about it. Look, when CAD softwares first came in, people thought, “Oh, it’s going to replace us, it’s awful,” but it just made your work more efficient and the workforce needed to adapt to a new world where CAD softwares are a thing.

They’re getting better and better over the years, and I feel like AI, at least in its current phase for product development, is similar. It’s a great tool. I use it a lot, even if it’s ChatGPT, to help you kind of open your thoughts a little bit, although you have to keep being critical towards it because it’s not always right, or right for you.

Tools like Viscom, or the likes, that allow you to actually generate concepts are quite interesting, but again, for us at least, it’s just that, it’s opening up. You’ve done your brainstorm, you’ve done your conceptualization stage.

Okay, what did I not think of? Let Viscom throw up 50 other ideas and take that on board. I think it’s a great tool, and the workforce needs to adapt to working with it. If it doesn’t, it might be replaced by it at some point, but I don’t see that happening in the next few years at least.

Jon Hirschtick

We’re seeing customers using that tool, Viscom tool, and some similar things as well. In conceptual, there’s a bunch of image domain conceptual tools that are catching on, different areas that are very, very interesting to us.

Oh, I wanted to mention another thing we’re seeing from customers in a different direction. We’ve been talking about AI in terms of features you would use, but we’re getting a lot of interest from customers, actual, not just interest, they’re actually doing it. And using Onshape as the only real cloud-native platform. The entire system is all in the Cloud, and thus very scalable. People are using us for their in-house AI efforts to do things like develop synthetic training data on their own models.

I don’t even know what they’re doing, but they use our system at scale. For now, customers who want to do that have to contact us. We don’t allow that with a standard license, but people will do things like a synthetic data generation, parametric iteration of models for, let’s say, intelligent exploration of design spaces.

They’re basically using our API to do geometry manipulation at massive scale. I’m talking about scale potentially hundreds of thousands or millions of iterations and doing it in support of their own AI activities. That’s become such a big activity in our customer base that we have some internal projects going on to make that more easy to do and formalize, if that makes sense. We’re the only platform that does that, really.

If you want to do that with a traditional CAD system, you’d need to install, I’m imagining, hundreds or thousands of licenses if you could get them on some home-built cloud, whether internal or virtual. It’s just not set up to do it. We’re very set up to do it, and so that’s a really exciting area that we’re seeing a lot of interest in from many customers and many research institutions as well, and some AI startups as well.

We’re seeing that coming in from all sides, universities, startups, and our own customers, many of whom are doing their own internal AI projects, and I’ll add, successfully in many cases, things that are really adding value to their particular operations.

Markus Fleckenstein

Right. I’m very excited to see what’s out there next and how this maybe will even itself over time with all that kind of impact and influence and requests needs. It’ll be a very interesting time, I think, with AI.

As we’re getting closer to the hour, and I want to keep some time for questions, at the end as well, maybe just for all of you, if you could give one piece of advice to manufacturers about preparing for the future of product development, what would it be?

Who wants to go first?

Liran Vaintrov

I think just the one that it, embrace new technologies, but not going through the standard processes, but go with eventually what is standard for any place like a PLM system. I’ve embraced the thinking and the best practices in terms of what you can get out of the system and implemented very successfully with the best practices that the system has for you to offer.

Also keep in mind the future like AI, like any other new tools that are coming to the market, eventually there will be changes, but for now go with best practices and collaboration.

Markus Fleckenstein

Awesome. Thank you, Liran.

Jon Hirschtick

I’ll go. I’ll say I’ll go back to how I opened. The world is changing faster than ever. Right, I hope we all agree on that. No one’s… In so many dimensions, it’s crazy. The world is changing faster than ever.

If you’re a product developer, a manufacturer, you have to think about how you need to change. Some of those things are forced on you, but you need to change. You need to look at your process and your people and how they work together because tools are an enabler of that.

What you really get out of tools like Arena, Onshape, or many of the others we’ve mentioned here, or many of the new AI startups, is you get an opportunity to work to change your process, not just to do the same things you were doing.

I encourage you to look at tools and new tech. Look at how you work and look for breakthroughs and look at new people or new ways of thinking about people as well as the tools, particularly your emerging workforce will come ready to think differently.

Markus Fleckenstein

Thanks, Jon. Any remark from you, Ran?

Ran Peled

I think earlier I and Jon probably covered most of it. I think the world is changing really quickly nowadays, and from what I’ve seen, manufacturers are not adapting quickly enough to that. To us, just an anecdote, at one point we wanted to offload some of the engineering work to our manufacturer that also has design teams and they’re a brilliant manufacturer, but the development lifecycle was so slow comparing to our development lifecycle that we’re just like, “No, there’s no way that’s going to get to market in time.”

Time to market, eventually you’ll spend so much money on getting something to market quicker, so working in parallel streams, putting more resources on things, and using the correct tools and using them wisely is something you have to adapt to. I haven’t seen any manufacturers doing that at the moment very well.

Markus Fleckenstein

All right, excellent. Thanks a lot for the great discussion so far. Let’s have a look at questions. What we see, there is one for you, Ran. Asks if you’re transitioning from another CAD into Onshape. I remember is that you only had a couple of months with SOLIDWORKS, which was their kind of a history.

Ran Peled

Yeah, it wasn’t too painful, if I’m honest. I think you can import your files, which we’ve done to an extent, but I think we were such at an early stage of our development that the cut has changed probably five times over since moving to Onshape. Probably not the best example in the transition because we didn’t have a massive storage of files that needed to be transitioned, and for us it was super easy, though.

Markus Fleckenstein

All right.

Jon Hirschtick

Yeah, considerably more complicated to make transitions to with respect to our more established customers who are listening, and Liran you may agree it’s more complicated the bigger your organization is, the more data you have, the more people, the more processes.

On the other hand, the benefits are larger, too. I’d encourage customers to think when they look at transition, a lot of the costs are one time, but a lot of the benefits are going to recur every day forever. Yeah, you have to make one-time transition, but then once you’re on the other side, the benefits are not one time.

The benefits are every day working faster, getting more innovation out of your team. Those things really, really accrue over time, and the benefits are growing. We talk about AI, AI’s just another… It’s not why we built cloud-native, but cloud-native’s going to outpace installed with AI. I think it’d be hard to find anyone who would argue that, and so that’s another reason to be there. We see things happening. I also want to mention AI, we do have a really rich startup partner ecosystem around PTC.

We’re doing our own projects, but we have partners like Leo AI, which I know is very popular in the Onshape community and the Israel community. They’re a fantastic product. They’ve announced they’re working on a direct Onshape integration and we have other AI partners like Ada IQ. I see them working in our customer base and many, many others. Backflip’s got some interesting stuff coming for the Onshape community. It seems like many of the leading AI startups are choosing to partner with us, which I think is wonderful.

If you’re an AI startup out there, you want to meet with me. Send me a note on LinkedIn or something. I love talking to you. We love partnering with you here at PTC. I think the P in PTC should stand for Partner, Markus. You agree? We like … partnering.

Markus Fleckenstein

That’s definitely a good thing. Yeah. That’s been quite a good focus area. Absolutely. Absolutely, and then I have more Arena-related questions, whoever wants to answer that. How many people did it take to implement Arena? And how long did it take? Then, there is kind of an addition to it, and why Arena? Is there any comparison to competitive solutions?

Liran Vaintrov

Hmm, so honestly, in the beginning we had the Oracle PLM solution, the Oracle cloud solution, and it was a very limited PLM solution, so we get to the point that wanted to select a new PLM system. We had a couple of persons on this selection team and the implementation team as well as the guys from PTC. We had a project management from our side, Kornit’s side. We had the integration person in this, and also the business, and combining with the business, good support.

We had a good example of project, but the business should be committed to this transition because otherwise, things get complicated and confused. There are many questions in the process to be answered by the business and to get decisions and be remembering that not everything you could achieve with the same processes that you currently have.

Some adjustments should be made, and if the business should not take decisions, so it’s getting complicated to do the implementation.

Markus Fleckenstein

All right, great. Thanks for the summary. Just checking if there are any more questions and I don’t think there are, so appreciate all your time, kind of you three for spending an hour with me and discussing the product of the future of product development.

Thanks for your insights. Thanks for sharing your thoughts. Bye, everyone online. Thanks a lot for attending. If you have any follow-up questions, feel free to connect with us on LinkedIn, or if you have noted the email address on one of the intro slides, feel free to as I sent the direct message.

With that, just again a big thank you to all of us, to all of you, and looking forward to staying in touch and have some further conversations. Enjoy the rest of your day and looking forward to talking to you again. Take care, cheers.

Jon Hirschtick

Cheers. Thanks, Markus.

Ran Peled

Thank you so much.

Liran Vaintrov

Thank you.

Markus Fleckenstein

Yeah.

Liran Vaintrov

Bye.