The last of our event reports for 2014, this exclusive covers all of the presentations, trends and themes to emerge from the latest in Dassault Systèmes series of 3D Experience Forum roadshows – this time in Las Vegas.
Throughout 2014, Dassault Systèmes has taken its “business in the age of experience” message on the road. This year, WhichPLM has reported from “3D EXPERIENCE” events in Munich and London, and in November we had the opportunity to both speak at and cover the latest in the series of technology roadshows.
Dassault Systèmes (also referred to throughout this article and in their own communications as “3DS” for short) chose a fitting location for the final event in its 2014 calendar; Las Vegas is a city defined by experience, and shaped by a constant redefinition of what’s possible.
And like the city planners who saw potential in a strip of Nevada desert, 3DS has maintained grand goals throughout its efforts this year; EVP of Corporate Strategy, Industry and Marketing, Monica Menghini, is on record as saying that her aim is to create an entirely new “species” of enterprise platform – interconnected, experiential, and inclusive.
Indeed, Menghini and Dassault Systèmes CEO Bernard Charlès opened the two-day proceedings in the edifice of the Cosmopolitan hotel – in front of 900 delegates and television cameras – by painting a vivid picture of the “digital journey” upon which all industries are being asked to embark, and articulating how their company’s “3D experience universes” can support that transition.
The broad-brush corporate message put forward by Menghini, Charlès and other 3DS executives in Las Vegas did not differ dramatically from that we’ve seen at previous events this year, and is omitted here for brevity. Readers are referred to WhichPLM’s 3DEXCITE Munich event report from March, and the vendor’s UK Forum from June for our complete take on the vendor’s executive vision.
That vision, as I’ve written before, is nothing if not bold. For some time now, Dassault Systèmes has opted not to speak in terms of products – the industry norm – but has offered instead one holistic “3D experience platform”, operating across PLM, CAD, sourcing, and a host of other functional disciplines, packaged and tailored according to the needs of twelve different industries.
But if this year has taught us anything, it’s that a different approach can resonate. The North American 3D Experience Forum may have catered to a host of different industries, but all were united by common challenges. Whether they produce Dreamliners or deck shoes, every audience member has come to understand that in the markets of the future – what 3DS calls “the experience economy” – true success will not be a matter of chasing diminishing returns, and getting marginally better at building the products they make today.
Thriving in this experience-centric world will require automotive and accessories business alike to redefine what it means to succeed, and to establish ways of setting the pace, rather than keeping up. And most of the presentations and discussions that made up the plenary and breakout sessions of this two-day event centred around this idea of transcending the typical product focus (something Dassault Systèmes has certainly embraced) to deliver a more complete experience, for consumers and end users.
No longer do companies simply sell products, since access is now ubiquitous to the financial, ethical, and inspirational stages that went into the creation of the garments, footwear and accessories we buy. The onus, as the overriding message of both keynotes and breakouts underlined, is now on the retailer or brand to deliver the experience a consumer expects, otherwise he or she will find it elsewhere. This must be one experience, consistent across channels – with multiple avenues of engagement, and a myriad ways of accessing the same information.
As consumers, we want the original intent (the humanity that went into a product) to remain intact at the point of our engagement with it, but as retailers and brands, we recognise that gulfs in processes and technologies prevent us from achieving that vision.
And this is where the 3D Experience “compass” comes into play, by unifying and integrating all of Dassault Systèmes’ previously standalone (albeit interoperable) applications. From the cardinal points (PLM, CAD, collaboration, high-fidelity 3D assets) to the smaller interlinking elements, the 3D Experience Platform is, according to 3DS, designed to eliminate the single-application silo mentality that can constrain corporate culture and stand in the way of the experience.
A heady vision, then, but Dassault Systèmes themselves are by no means alone in perceiving fundamental shifts in the business paradigm – for fashion and for the other eleven industries the vendor serves. Following an executive introduction by Bruno Latchague (Senior Executive Vice President, Americas Market and Global Sales Operations) and Ken Clayton (VP of Worldwide Sales at Solidworks) the founding Editor of Fast Company, William “Bill” Taylor delivered a keynote speech focused almost entirely on that kind of disruption to the accepted norms.
Taylor spoke about an era of “hyper competition and non-stop disruption”, and explained how this gives rise to reframed definitions of success: a competitive landscape no longer defined by financial clout and sheer inertia, but by companies of all shapes and sizes taking frank stock of themselves and making deeply-rooted changes to better face an uncertain future.
So important does Taylor believe this business of change and innovation – the cornerstones of the experience economy – to be, he called it “the defining work of our time”.
Modern retail and brand engagement, Taylor explained, has transformed, and younger companies are overthrowing the methods of their forebears, redefining the playing field through a continuous and iterative process of improvement, enabled by modern technology. Unlike the old guard, Taylor argued, today’s successes in retail, footwear and apparel (not to mention the other industries represented in his audience) no longer settle for offering good products and services – they stand for compelling ideas. And while there has always been a strong association between product and identity, but in 2014 and beyond, the unity of both – the ephemeral “experience” – has become of paramount importance.
Delivering that experience, though, requires new tools and a new way of thinking – foundations upon which the experience economy can be built. And Dassault Systèmes’ events – like its products themselves – are possibly best defined in exactly those terms: frameworks that provide a template and a toolset for innovation.
Despite the common nature of many of those tools (and indeed the obstacles that stand between businesses and their future in the experience economy), the fact that Dassault Systèmes tailors its solutions for unique, industry-specific challenges led the organisers to split those industries into breakout sessions. And although there was certainly some cross-pollination of ideas seen outside these sessions, WhichPLM dedicated its attentions to the CGR (consumer goods and retail) conversation taking place in one of the Cosmopolitan’s smaller – but by no means small – presentation room.
Following a short introduction from Celia Newhouse (Industry Marketing Director for Dassault Systèmes’ CGR division, and overall coordinator of the breakout session) WhichPLM’s own Mark Harrop began the first day with a presentation titled “PLM In 2014 And Beyond”.
Harrop drew from WhichPLM’s recently-published Annual Review 2014 to speak confidently about the shape and scope of the PLM market for retail, footwear and apparel in the financial year 2013/14, and to make informed predictions for its future.
Chief among the topical statistics taken from that publication were the quantity of PLM sales worldwide to date – a number exceeding 1,100 – and the distribution of the same in 2013/14. In a $400 million annual market (not to mention one exhibiting strong double-digit growth year on year), 46% of PLM sales took place in North America; 43% in Europe, and 11% in the Asia Pacific region. And while Harrop acknowledged the comparative size of the latter figure, he urged audience members to remember that this still represented a surge of 7% on the same regional distribution in 2012/13, and that dramatic changes in the manufacturing and retail industries in China and throughout Asia will soon have a significant effect on those regions’ appetites for technology.
In explaining his belief that PLM for the consumer goods and retail industry has “crossed the chasm” – a term he and the WhichPLM team borrowed from business writer Geoffrey A. Moore – Harrop pointed to data indicating that in 2014 close to 80% of PLM sales were to retailers and brands with turnovers of less than $1 billion. This, Harrop said, represents PLM’s transition from early adoption to mass market penetration – something that he also believes is reflected in the relative maturity of today’s PLM solutions when compared to legacy PDM toolboxes.
Despite this, Harrop’s presentation contained some potential (albeit entirely avoidable) pitfalls for consideration by those delegates who may be considering a PLM project without weighing up its true impact. Owing to a lack of planning and introspection during their early phases, only half of all PLM projects worldwide came in on-budget and on time in 2014, and, Harrop revealed, more than 60% failed to achieve their desired ROI outcomes.
Rather than ascribing this to any failings on the part of technology vendors (although failed implementations are by no means non-existent) Harrop instead cited inadequate preparation and return on investment analysis as the primary culprits.
Having been directly involved with PLM since its introduction to the fashion industry in the 1980s, Harrop emphasised the importance of understanding PLM’s history (charting its rise from those legacy PDM deployments to modern, out-of-the-box solutions) in order to accurately chart both current best practice implementation approaches and the industry’s future – a time that he believes will be defined by several key trends.
First amongst these is the need for retailers and brands to collaborate more closely and effectively with their supply chain partners will be driven by continued advancements in the infrastructure of regions that host satellite office, agents, or manufacturing partners. As a result, the degree of social engagement that has been typically reserved for a brand’s head office will become open to factories, agents, and partners in new economies – all enabled by PLM.
And rather than pursuing bespoke developments centered around customisation, the new wave of PLM deployments will be managed predominantly through configuration and an “app ecosystem” much like that exhibited in Dassault Systèmes’ verticalised product collections. This approach will help to ensure that retailers and brands are able to benefit from the latest advancements to their chosen solution, and to embrace PLM’s place as the unifying backbone of modern product development.
Harrop collected these and other trends (including the importance of user experience amongst the next generation of professionals) under the banner of “digital transformation”, which he interprets as representing two things: a change in technological environment, leveraging the latest digital-first approaches from the consumer industries; coupled with a change in mindset, allowing a retailer or brand to actually benefit from these new technologies rather than simply speeding up their existing ways of working.
Harrop was followed onstage by Jérome Bergeret (Director of FashionLab), a man who is certainly no stranger to challenging the status quo and pioneering sweeping changes to the concept-to-consumer process.
By attending multiple 3D Experience Forum events, WhichPLM has been exposed to the FashionLab concept numerous times, but in this presentation Bergeret further refined and communicated its three key elements: trend gathering, the luxury experience, and the creation of three-dimensional, photorealistic design tools for the fashion industry.
Bergeret also took something of a unique approach to helping delegates understand his vision, conducting his presentation by looking at a hypothetical future – a 2030 where the word “digital” is no longer synonymous with simply working with I.T., but now serves as shorthand for embracing the opportunity to work in three dimensions, from product inception to product creation.
Borrowing from Dassault Systèmes’ own advertising slogans for the consumer goods and retail sector, Bergeret asked whether, in that world, a dress designed entirely virtually will fit in the real world, and whether those same virtualisation technologies have the potential to turn our homes into fashion houses.
These taglines and the visuals that accompany them are certainly inspiring, but I have had my reservations about just how close these scenarios are to being realised. I wrote earlier this year as something of a 3D skeptic – at least insofar as it applied to the business of fashion – but amongst other evangelists, Bergeret’s passion has since been a major factor in convincing me that not only is 3D viable, technically speaking, but that it makes business sense and has viable and immediate applications. And his presentation during this 3D Experience Forum was no different.
Writing today, I firmly believe in the merit of 3D as more than just technology for technology’s sake. Its value, as Bergeret explained, lies in the sheer utility of a high-fidelity 3D asset at every single stage of the product lifecycle – something that he and his technology incubation team have distilled neatly in their messaging.
A key concern (one that dogs any conversation about 3D) that virtually all readers of WhichPLM will have experienced first hand is the fear of technology. The sense that something as transformative as 3D design might rob our brands of their creativity, rather than enabling it. Luckily this is something Bergeret tackled head-on – reiterating his belief that designers are artists, not I.T. professionals – and explaining that FashionLab’s work has been geared around safeguarding that identity, and leveraging only the best of modern technology to invisibly serve creative needs.
And Bergeret is also candid about Fashionlab’s role currently being confined to the prototyping and focus testing stages of product development rather than in the mass creation of styles and lines, since integrity of inspiration and continuity of craftsmanship matter most, he argued, in the earliest stages of a premium product’s lifecycle.
Bergeret captures the importance of that integrity in his phrase “H2H” (or human-to-human) which is a term he believes will become as widely adopted as B2B or B2C – a descriptor for a new avenue of experience. And this experience, he emphasised, will be facilitated by the next generation of product development solutions: an intermingling of PLM and digital asset management, with those assets existing in high-fidelity 3D from the moment of their conception, and perhaps even as far as their manufacture in-house using 3D printing.
Outside the presentations themselves, in what was called the “3D Experience Playground” there was amply opportunity to experience Bergeret’s vision first-hand, including immaculately rendered and 3D-printed footwear showcase pieces. These were designed and built with 3D tools provided by Dassault Systèmes to haute couturier (one of only twenty-five people afforded this designation worldwide) Julien Fournié.
These showcase pieces embodied Bergeret’s stated goal of confusing consumers and experts alike as to which version of a given product – the 3D model, the traditionally manufactured prototype, or the 3D printed equivalent – was, by their definition, “real”. Indeed, his presentation closed by considering the potential impact that this confusion between the real and the virtual might have on the consumer retail experience, and how not just the design studio but the storefront of tomorrow might look.
3D printing itself has the ability to shake up numerous industries – not least of them fashion. And although we are some distance from being able to print fabric, the broad concepts are transferrable, and businesses the world over have already begun to seriously evaluate the effect that a 3D design to 3D print workflow might have on product development, intellectual property, bricks and mortar retail, and much more.
The advances made to 3D printing technology have allowed everything from footwear to vehicle chassis to be brought to life, and demonstrations were available during the event of smaller, moving parts (belt buckles, buttons, ball bearings) being manufactured on demand.
Following Bergeret onstage was Steven Madge of 3DXCITE (formerly RTT) who joined the 3DS umbrella to offer 3D solutions from consumer end of the spectrum. Madge talked about the value inherent in leveraging the kind of high-fidelity 3D assets Bergeret mentioned at both the product creation and marketing (or point of sale) steps of the concept to consumer journey.
Under its old RTT moniker, Madge’s company provided technologies geared around the production of consumer-facing materials for the automotive, fashion and lifestyle industries. And during a previous session (at the 3DEXCITE event in Munich earlier this year) I saw impressive demonstrations highlighting technology’s ability to overcome physical limitations – placing the newest cars in impossible or impractical situations, or switching trims and upholstery on the fly. As Madge explained, this history serves the newly-crowned 3DEXCITE well in a range of sectors, and best practices relating to virtual prototyping and sampling are applicable to virtually any market.
And so, Madge’s presentation went on to examine the potential of 3DEXCITE’S photorealistic 3D rendering solutions in three separate industry-agnostic areas: design, operations and marketing.
The importance of ease of use, speed and integrity in design had been well explained by Bergeret before him, but Madge also highlighted the value of three-dimensional working in minimising the often exorbitant costs of physical prototyping and sampling on a seasonal or even fast fashion basis. In her closing presentation, Susan Olivier of Dassault Systèmes actually placed a figure on these sample reductions as potentially accounting for up to 900,000 garments per year within a large organisation.
Madge’s presentation thereafter, however, remained resolutely focused on merchandising and marketing, examining how photorealistic 3D rendering can be appropriated to sell and to communicate visual identity and product “feel” more consistently through multiple channels and platforms – the myriad ways in which a modern consumer can engage with a brand across seasons and territories.
For Madge, the essential value of a photorealistic 3D asset for the purposes of sales and marketing lies in both its fidelity and its flexibility. Not only can these assets – be they hatchbacks or handbags – be utilised wherever a traditional product photograph might have appeared, but they can be repositioned, tweaked, and adapted depending on the audience they are designed to appeal to. A virtual photoshoot, for example, can be reframed from summer to autumn or have materials changed without having to call up the photographer, model, or stylist, or to obtain further production samples from overseas.
Re-use; don’t recreate, the mantra goes, and the showreel of rendered shoes, handbags and other accessories Madge showed were essentially indistinguishable from reality. These included examples from digital-first companies like Coach, Vans and Sketchers, all of whom have extolled the value of preserving the essential character of a product, whether that’s between design and manufacture, or manufacture and consumption.
With no shortage of experience rethinking things from consumer side of the equation, Leslie Hand (VP of research at IDC Retail Insights) then took to the stage, closing the first segment of the CGR breakout sessions by speaking about “future proofing product innovation strategies”.
As Hand explained (and Madge touched upon when he talked about the potential for digital product assets populating interactive shopping walls in stores) innovation in the retail and brand environment today goes far beyond the creation of on-trend or unique products.
Hand devoted much time to characterising the modern consumer – always connected, prepared and willing to engage with a retailer or brand in virtually any situation, and expecting instant gratification and access to the brand lifestyle in return. And while the historic shopper made his or her purchasing decisions on a single criterion (whether the product provided value for money) today’s connected consumer also factors in values, plural – taking account of the social, environmental, ethical and accountability aspects of brands’ operations and services.
Citing IDC’s own research, Hand revealed that although price still remains the main factor in consumers’ decision-making processes, these other, less objective, facets are assuming greater importance with each passing year. This is something we’ve written about extensively on WhichPLM and in our 2014 Annual Review, and Hand’s presentation concurred that the precipitous growth of technology accounts for much of the sheer pace of change in the behaviours of modern consumers.
In the face of this kind of transformation, Hand said, the battleground for retail and brand organisations has shifted to the multivariate definition of “innovation”, which Hand and her colleagues at IDC have attempted to quantify in a report looking at what they call the five levels of technological “product innovation maturity”:
Hand then looked at some of the main ways that retailers and brands conduct this innovation, from materials science to process efficiencies; from international compliance and sustainability to omnichannel engagement; and from RFID tagging to social engagement and tracking the voice of the consumer.
The impact of sustainability – one of Hand’s cited pillars of innovation – was then the topic of a later discussion led by Cameron Childs, Product Manager for the Sustainable Apparel Coalition.
Childs’ presentation examined the potential to integrate sustainability and compliance processes into modern PLM. And her opening remarks contained sobering statistics that reminded delegates the importance of the SAC (which currently leverages the collective knowledge of more than 140 members) and other similar NGO and legislative bodies – and why compliance and transparency are not just today’s hot topics, but why they will (and must) remain the most sacrosanct aspects of modern business.
Of the 7 billion people who currently live on earth, Childs said, a rapidly growing number can be defined as occupying a relatively affluent middle class – the target market for the products made by Forum delegates: cell phones, clothing, cars. And the impact these classes have on the environment, and on the people who manufacture the products in question, is accelerating.
Broadly speaking, Childs revealed, in order to make the products that are being consumed by those growing numbers of consumers, we as a species are using more water, chemicals and other irreplaceable materials than our earth can sustain. In fact, to maintain our current standards or growth and innovation, humanity will require an additional one and a half planets’ worth of resources by 2050.
In light of these stark figures, it’s little wonder that sustainability reporting (collected under the umbrella of Corporate Social Responsibility, or CSR) has been increasing in the apparel industry by around 40% year on year, in terms of accountability and public perception. But this still does not measure up to the fact that three quarters of all shoppers (75%) are now considering the environmental and ethical aspects of their purchasing decisions.
But public expectations are not the only divers behind retailers and brands taking stock of their sustainability credentials, and Childs listed four other major influences in this area:
- Resource scarcity and resource efficiency, or the desire to buy only what you can use.
- Governmental regulation, which is something Childs explained is approaching rapidly. The European Commission, for example, is already looking to standardise methods to calculate environment impacts, with potential labelling due as early as 2017.
- Interest group and NGO scrutiny – both of which represent a significant risk to risk to brands’ and retailers’ reputations.
- Opportunities for innovation, in everything from product materials to marketing and awareness.
The biggest of those opportunities, Childs explained, is the potential to get ahead of scrutiny and legislation – to work with your product teams to define approaches and systems by which sustainability can be built into PLM. A state where true transparency becomes another tool in your arsenal, allowing you to design out the potential impact of everything from materials to labour.
Delegates might have been forgiven for wondering how much of a difference this might make, but Childs voiced a timely reminder that between 75-90% of the environmental impact of a product is already fixed at the development prototype stage, where proper sustainability processes can have the greatest potential effect.
To close her presentation, Childs was joined on stage by Asheen Phansey of the 3DS Sustainable Innovation Lab, who provided a PLM vendor’s perspective on the promise of integrating the SAC’s Higg Index to ENOVIA (or My Unified Development & Sourcing, as the Dassault Systèmes PLM product is currently sold). Phansey showed mock-ups of the concept in action, demonstrating information added to the bill of material functionality of the 3DS PLM solution.
The work shown here is certainly a step in the right direction, and WhichPLM strongly supports the work of the Sustainable Apparel Coalition. But from the perspective of PLM analysts and advisors, it’s important that we note the importance of other regional legislation and guidelines when it comes to considering truly global transparency and compliance.
A continuous thread through Childs’ and Phansey’s joint presentation was the desire to strive towards an ideal – to accept that while we (as retailers or brands or technology developers) may not understand the precise shape the future will take, we are aware of the forces that are moulding it, and the forward thinking amongst us are taking steps to prepare accordingly.
The defining presentation of the day, delivered by Susan Olivier (VP of Consumer Goods and Retail Industry Solutions for Dassault Systèmes) was, then, appropriately titled “Shaping the World We Imagine”.
Olivier began by emphasising the fact that Dassault Systèmes’ definition of “consumer goods and retail” extends beyond footwear, apparel and accessories to also include home goods. All of these subsectors, she explained, share common challenges – most notably the increasing pace of change, driven by consumer behaviour, technological development, and the expectations of the next generation of CGR professionals. Dassault Systèmes draws upon these shared challenges to create what it calls “verticalised” solutions, matching as closely as possible the needs of the sector at hand, be it aerospace or apparel.
For Olivier, then, the digital transformation of the brand and product lifecycle in the CGR sector – from design to consumer – is no longer a question of “if”, but rather a question of “when” – whether you deal in fashion or home furnishings. And that degree of change, she explained, doesn’t end with manufacture and logistics; the retail environment itself is transforming, with companies taking the opportunity to turn their flagship stores into shrines to the brand lifestyle, rather than just sales leaders. And related to this, consumers themselves now approach high street stores as a destination to immerse themselves in the brand, to experience the product, and then to seek it out in the most convenient way elsewhere – so-called “showrooming”.
Throughout her presentation, Olivier referenced retail predictions by industry analysts Gartner, who believe that business models – the delineations between regional and national brands, retail and manufacture, and between channels online and off – today are designed with change and adaptability in mind. A retailer might launch a private label brand to meet an identified demand; a boutique online-only brand will likely set up pop-up retail locations that eventually transform into a permanent high street presence.
Despite what might appear to be an uncertain and constant state of flux, Olivier cited Gartner research suggesting that consumers will actually become more loyal to their brands as a result. While we might expect this kind of dilution to negatively affect allegiance, in fact the connected consumer is willing to follow their favourite brands throughout their reinventions, and engage with them every step of the way.
But, as Olivier explained, this kind of reinvention requires new ways of working, new processes, new access to information, new mobile tools, and new experiences behind the scenes as well as on the shop floor. As an example, she cited a further Gartner prediction – that 20% of durable goods retailers will have set up 3D printing operations in some sense by 2017.
What Olivier is talking about is change on a grand, almost science-fictional scale – something that validates the long-term vision of her company’s 3D Experience strategy. These are dramatic alterations to the long-established paradigms of retail, spurred on by technological developments that threaten to disrupt everything from selling to manufacture, and that require imagination to truly comprehend.
Luckily, imagination is something Dassault Systèmes exhibit at every turn, with Olivier accentuating the flexibility and future proof nature of their fashion platform. Olivier sees one of the core roles of the 3D Experience platform to be the safeguarding of digital (in this case high-fidelity, three-dimensional) assets from “conceptualisation to realisation” to ensure integrity of identity, and to mitigate the need for interpretation throughout product development. To that end, Olivier said, the platform gathers data from across the organisation, providing a retailer or brand with absolute visibility of information both internal and external – something she referred to as “a thorough view of my world, in one place at one time”.
To close the final day of the event, Olivier was followed on stage by Sarah Fabian (CGR Industry Strategy Director for Dassault Systèmes), who talked at length about recent developments to the platform’s bill of material functionality, product categories for costing and sourcing, and the overall PLM R&D pipeline. Fabian emphasised the importance of using customer feedback to shape their development priorities, and gave a high-level overview of what prospective and existing customers can expect from the upcoming V6R 2015X release of ENOVIA – part of the My Unified Development and Sourcing collection.
Although Fabian did not touch on this, our experience shows us that consumer goods and retail is one of Dassault Systèmes’ fastest-growing verticals, and although previous presenters had touched on the concept of our industry learning lessons from others, for me it was heartening to see that this trend goes both ways.
Our experiences outside the CGR breakout sessions demonstrated that more and more industries are beginning to operate in a fashion model; products that were previously utilitarian in nature are now, through those aforementioned advancements in technology and consumer engagement, effectively fashionable products. Design-led items with clear identities, and products that consumers seek to experience rather than just buy.
Design matters across industries, then, and so does the importance of maintaining design integrity, improving product quality, accelerating speed to market, and indeed designing closer to trend than ever before in order to deliver against consumer expectations.
And whether you call this “human to human” interaction or subscribe to the idea of the new economy, there can be little question that Dassault Systèmes has worked diligently to place itself near to the front of the pack where the experience is concerned.