Sep 112012
 

Today is a day of solemn remembrance for Americans and many around the world who remember the 9-11 attack on the the United States of America.  However, there is at least one person who likely quite happy today for a very different reason: Andreas Tsetinis. Siemens Acquisition of  Tsetinis Perfect Cost Hiller Associates   Andreas is the Founder and CEO of Perfect Costing Solutions who makes Tsetinis Perfect Pro-Calc and Perfect Calcard.  In the biggest Product Cost Management (PCM) news of the day, Siemens PLM (specifically the Industry Automation Division) has announced the acquisition of Perfect Costing Solutions.

What is Tsetinis and What are Its Products?

For those of you who are not familiar with Tsetinis & Partner (parent of Perfect Costing Solutions), it is an integrated product cost company of software tools and consulting services. Siemens Acquisition of  Tsetinis Perfect Cost Hiller Associates Many people consider the software tool side of the Tsetinis business, Perfect Costing Solutions, the recognized market leader in Europe for the PCM.  In the last couple of years, the product Perfect Pro-Calc has also been making inroads in the US.  Perfect Costing Solutions makes two software products:

  1. Perfect Pro-Calc – This is a cost estimation tool used primarily by costing experts.  It is fed by manual input that allows predictions of cost for mechanical and some electrical parts.  Perfect Pro-Calc also includes that ability to roll up costs in a hierarchical BOM structure that the user defines.
  2. Perfect CalCard – This is a software focused on capital tooling (injection molding, casting, and stamping) cost estimation by tooling experts.  It has the capability of accepting 3d solid CAD models as input to the costing process, although, I am personally not aware how advanced this ability is.
Per the Perfect Costing Solutions website, “today over 240 companies in the automotive sector and other industries successfully use our products.”  Perfect Costing Solutions has 50 employees according to the Siemens press release.

What does this mean for Product Cost Management?

Product Cost dominos Hiller Associates

The last year, starting from September of 2011, has been a very eventful year in Product Cost Management.  First, Solidworks unveiled its first foray into the PCM world:  Solidworks Cost — the first tool, besides aPriori, that can cost parts directly from geometry.  Then PTC announced Windchill Cost.  Windchill is not a cost generation tool, but is a cost management / roll-up tool that builds off of Windchill.  It allows customers roll-up costs generated by other softwares or methods and track and analyze these costs.  Now we have the very first Product Cost Management acquisition (Perfect Costing Systems, Gmbh) by a major Product Lifecycle Management player (Siemens).  This begs many questions, among them:

  • Will the PLM companies begin to dominate the PCM space and crowd out the pure plays?
  • Will Siemens attempt to build CAD Feature Based Costing abilities into Perfect Pro-Calc?
  • What does this mean to PCM software companies; will other players acquire specialized PCM software companies?

I am going to see if I can get an answer to these questions.  In an eerie coincidence, just this week, Jim Brown of Tech Clarity and I were just discussing me writing an article about where Product Cost Management might settle out in the enterprise software landscape.  It sounds like it’s time for me to write that article…

What does the rest of the PCM world think about the Siemens acquisition of Perfect Costing Systems.  Please let us all know by commenting!

  6 Responses to “Siemens buys Perfect Costing Solutions (Tsetinis)”

  1. It would be ideal if SPLMS merged the functions acquired from PCS into their Teamcenter platform and had their embedded visualization (JT files derived from a multiplicity of MCAD systems) act as the basis of the 3D geometric analysis.

    Key PCM properties could then be logged in or exposed from Teamcenter itself and even queried or reported against in summaries.

    Their recent “visual reporting” capabilities could even be leveraged. As an example that could allow a large product structure to be loaded in visualization and then highlight components, in 3D with a certain color spectrum, which were over their individual cost targets by predetermined percentages.

    PLM seems like a better home for PCS so hopefully they won’t bake it into CAD (NX).

  2. Dijon,

    Thank you for your comment. I believe that you make a compelling argument for where the cost info should be stored. Are you suggesting that the costs be generated in PLM, as well? That is, are you assuming that the engineer must first check-in a completed design before the costing occurs? If so, wouldn’t that be a big barrier to doing effective Design-to-Cost using the Feature Based Costing capability you hope Siemens build into Perfect Costing?

    Eric

  3. I was suggesting that.

    My view of costing is that it’s just another form of predictive digital analysis like CFD, FEA, etc. Those other types of analysts are accustomed to gathering geometry from PLM. With costing it’d be nice to perform tasks in an application that at least has the same look and feel as the broader PLM system.

    I’d venture to say that at many companies the regular check-in of artifacts such as native CAD files is commonplace. That spans the gamut from conceptual design or work-in-progress, much of which may be abandoned along the way in favor of better designs but that’s OK, to final release and revision based maintenance thereafter. Storing in PLM is often encouraged by practice/policy considering that the PLM environment is typically subject to a backup routine whereas local drives or shared network folders are not. Think of the mentality as “Store early and store often.”.

  4. @Dijon – I agree that the product cost number should be stored in an enterprise system. The question is, where should the master be: PLM, ERP, SCM? What system should be the primary that feeds the other? The other problem is do these systems have metadata structures appropriate to hold the cost info. Until a couple years ago, many PLM systems did not even have a metadata field for “cost”. And, what is the cost? Does it include raw mat’l… and labor… and overhead? What about inbound logistics? Finally, it would be good if people did not have to manually transfer the cost info. But that would require integration between the enterprise system and the PCM tool. Most of the PCM software companies are small and don’t have a lot of development dollars to spend on integration. Perhaps, a forward thinking ERP or PLM company will step up and pay for the the integrations? — Eric

  5. 1. Predicted cost related attributes mastered in PLM via built-in PCM functions which leverage CAD agnostic information (2D, 3D, meta-data, ECAD, MCAD, software, etc.)

    2. Predicted cost related attributes transferred to ERP via interface and represented in a read-only manner in ERP (triggered to occur based on an event such as item master send to ERP)

    3. Actual cost related attributes mastered in ERP via history of RFPs/RFQs/orders/invoices/etc.

    4. Actual cost related attributes transferred to PLM via interface and represented in a read-only manner in PLM (triggered to occur based on an event such as order acceptance in ERP)

    Many might consider CRM and SCM to be intrinsic to or extensions of ERP depending on which product they use for that (e.g. Oracle e-Business Suite, SAP, etc.).

    Definitions of predicted and actual cost related attributes (however many of each type are deemed necessary) could/would vary on a company-by-company basis. That personalization wouldn’t be unusual. Tweaking the data structures of modern ERP and PLM systems is now somewhat commonplace and not phenomenally difficult to do.

    Some solution providers already offer off-the-shelf, although I hesitate to call them turnkey, interface products between PLM and ERP which could be a significant head start.

    Manufacturing planning already has a foothold in the PLM space and much of that logic in theory could be reused during PCM analysis. Aspects such as factories, departments, work areas, tooling, routings, operations, time standards, etc. come to mind.

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