Cloud & SaaS Solutions: Benefits for Startups and SMBs

Vincent: I would say that the potential comes from the various layers. In the previous podcast, we explained the infrastructure as a service, platform as a service and software as a service. When you think about it, the infrastructure itself brings a lot of benefits in terms of collaboration across a given company.

But if you add on top of that software as a service, it means that you are delivering to all clients at the same time exactly the same level of your software. So, at any time everybody using your software is exactly on the same level. It means that they can collaborate together at any time. And it's something that does not exist at all on premise or on any legacy software. Only this capacity of the software as a service gives, by default, a high level of collaboration.

Sébastien: Yes, I think that there is another big opportunity associated to SaaS, potentially more than the cloud, for our customers. It’s to speed up their development and change their existing business process. All of our customers need to accelerate their go to market, and SaaS is clearly a solution, allowing them to set up new projects, new programs, new ways of working, with a total disruption compared to the existing processes, based on legacy solutions.

If you can take as a sample the transportation and mobility market, I think it's clearly a good sample. More and more automotive customers need to engage very quickly on new products, like electric vehicles, and they know that they need agility, and agility is associated really to SaaS solutions.

So, I think the best advice I can give to startups and large companies is: don't spend time building your IT landscape on a new hyperscaler solution. Directly choose a SaaS solution that meets your needs and potentially with the platform.

Vincent: Yes, I think you're right there. They were very creative on their information system, creating new capabilities, customizing the software, and here SaaS brings them the capacity to be creative on their product and not on their information system.

Sébastien: Yes, they can stay out of the box, use the solution as it is without spending a lot of time. I think it's great. Really high-level values.

Clara: Alright, so new ways of working, new capabilities.

Sébastien: Again, I think that this part of SaaS can help deploy new tools, new processes, start a new functional perimeter without spending a lot of time.

A customer can start to deploy the platform potentially on a specific perimeter, manufacturing, add progressively other capabilities: simulation, engineering, design. And that's really a very good opportunity for growing very fast.

Vincent: Yes, I agree with you, Sébastien. I think the innovation, it has been demonstrated that it is a collaborative process.

Bringing a lot of people working together and benefiting from the ideas of everyone. And as we said just before, SaaS is breaking the silos between our organizations and even between partner companies. It simplifies the sharing of data, the exchanges. And all the workforce can contribute to the innovation on your project.

And SaaS is benefiting many different projects. We will maybe discuss that later, but between OEMs and their suppliers – we have seen several projects in the last five to ten years where we have very large companies collaborating with smaller ones thanks to the cloud and SaaS environment.

And even it's the opposite. Sometimes it's a startup asking large companies to collaborate with them. So, it has changed a little bit the flow and the capacity to grow for those small companies.

Sébastien: Yes, we can also see the platform effect. Companies are discovering that they are facing an issue and very quickly they find a solution, start the usage of a new application, try it one day, one week and deploy it at scale. So, it's clearly a change in terms of mindset. The adoption is very fast.

Clara: So, it's creating more opportunities, changing the way we work and giving more capabilities to startups.

Sébastien: I think that SaaS solutions allow startups and SMBs to start gradually without a huge investment in the beginning, and give them a lot of freedom to adapt themselves, to engage on a new functional perimeter without any digital discontinuity.

They can easily add manufacturing solutions on top of engineering and design, and after that they add simulation within their business process. So, efficiency of startups compared to large companies seems to be very important when they adopt such types of solutions. I think that the flexibility of SaaS is probably similar to the flexibility of startups.

There’s no need to think about new servers to deploy, new applications for new divisions in the company. In one click, one hour, they can start working with new people. And I think, really, that there’s no need to hire additional people to manage IT tools. Because we know that it could have a huge cost. So, a company can really hire people totally focused on their real business, and not for IT or customization, or something like that.

Vincent: Yeah, correct. I think this topic of IT, infrastructure, investment at the beginning was preventing, in the past, the creation of startups, to create new products, new projects, new innovations.

I would add on top of that, the topic of subscription. I think it's very important when a new company is created, a startup is created. They want to reduce the cost of subscription, and they really see the PLM, the CAD, as a commodity, in fact, in what they have to do. So, depending on the product that they want to develop, they will look for the best tool, and they want to have it in a subscription engagement because they don't want to invest massively.

They don't know if they will succeed in creating and producing their product. They will have a cost per headcount, which includes the office, the IT environment, and this IT environment will contain the CAD software, the simulation software, and many other tools needed as a subscription. So, it's important to propose subscription.

Sébastien: Yes, again, and subscription allows them to have agility and predictability in terms of cost, which is also huge in terms of importance for such a type of business.

Clara: Right, so we talked about flexibility, scalability, simplicity, lower costs as well with the subscription model. Now I want to come back to what Vincent mentioned earlier which is that cloud and SaaS are changing a lot of things, and that includes how companies interact with each other.

Vincent: The thing is, the products that the companies or small companies or startups want to develop are more and more complex. And the fact that they start small does not prevent them from thinking big. And they need tools which allow them to design and simulate and produce very complex systems, very complex products.

So, they tend to choose the same solutions that big companies would choose to design aircraft or automotives. And those small companies, they look for the best software and solutions to work with and to develop a viable product and viable system.

And by doing so, first it makes their studies or preliminary designs viable ones. And in front, as I said, of funding companies, it's robust, but it also gives them the capacity to supply part of their design and product to larger groups who already have some knowledge. Because those startups, they don't innovate on everything and all parts of their product. They reuse some of the existing materials and products. And they tend to subcontract or supply some of their products to larger companies that are already well established in that industry. And this is where they can invite, on their environment, larger groups and bring them in as well on using SaaS software.

Sébastien: Yes, fully agree. Large OEM solutions from the automotive sector, aerospace and defense, are frequently used by all the supply chain.

All of them can use the same tools, and SaaS solutions allow a very good level of collaboration between the OEM and suppliers, and also because the deployment in an extended enterprise is very easy. Whatever the size or the location of the companies, they can deploy very fast and collaborate with each other.

I think that there is also another case. You can probably remember some projects in the past five years during the creation of joint ventures. When some companies want to collaborate with each other, they want to create an IT landscape fully shared and fully isolated from their own business. In the case of joint ventures, it’s very easy, thanks to SaaS solutions, to start a new project. And that's probably another important case for large or brand-new companies.

Vincent: I think globally, the cloud gives a possibility for many new industries or many new segments to change the way companies are working together either in electric car, electric aircraft, nuclear.

As I said, it's large projects. And all those startups investing in those new domains, they will continue to collaborate with large companies coming from more traditional products. But they will force them to collaborate on the cloud and on SaaS.

Vincent: It took time. As we said we were probably at Dassault Systèmes a bit in advance in terms of strategy in the – when I think about it seven, 10 years ago. But what we see now, this strategy was really the good one. We know that all companies will end their journey moving to SaaS, really.

Today, most of them are probably just on the infrastructure as a service. But step by step, it will come because if they just stay on infrastructure as a service, it's still a topic for IT, for information system. It's not yet a shift in the way they can focus on innovation and creating new products. So they will come to that because they will have new challenges on sustainability.

They will have new challenges in reducing some of their KPIs and improving the way they manage the materials and so on. There are so many topics where they have to improve their products that they will be very happy to focus less and less on IT.

Sébastien: And I agree, when you see the number of constraints from every company, a lot of new norms, new topics to consider. I think that it's really a game changer and there is no other solution compared to SaaS to adopt and to allow them to adapt with this level of speed.

Just to give an overview of what we can currently see, in terms of adoption. Whatever the industry of our customers. They are really starting to work on the cloud and really more frequently than on premise. Some of them are companies we have been working with since decades, like automotive, aerospace or industrial equipment and globally they are following our advice.

But something really new, other companies in the defense, life science, healthcare sectors, which never used SaaS solutions in the past two years, are currently adopting such types of solutions. And that's really something which is changing in the very recent period.

Vincent: Yeah, I agree with you. All industries, all segments are now considering this move, which was not the case, five years ago.

Clara: What I gather from what you're saying is that there's still some way to go towards SaaS, right? But gradually companies will be moving more and more towards SaaS solutions, right?

Sébastien: I think that really the best way to, to discover SaaS is to start on a small perimeter: discover, put some users, start a small project. And what we can see is that every company starting like that is growing in terms of adoption very fast.

Vincent: Indeed, there's no risk in trying and even the larger companies; they have invested in innovative projects with some of their team members to look at some of the SaaS capabilities and from there, in most of the cases, they extend the perimeter to the rest of the company.

And it's part of the DNA of SaaS, which is indeed to have a slow start to be able to try.

Sébastien: And to grow very fast after that.

Vincent: And to see the benefits, yes.

Clara: That was very promising. Vincent and Sébastien, thank you so much for sharing all these insights with us today.

Vincent: Thank you.

Sébastien: Thank you. You're very welcome.

Clara: Thank you for listening to Designing Impactful Innovation. To find out more, go to 3ds.com/cloud. Don't forget to subscribe for more insights and stories from our guest experts.