Today Dassault Systemes announced the signing of a definitive share purchase agreement to acquire supply chain and operations planning software provider Quintiq for approximately €250 million ($338 million). Supply Chain Matters was somewhat surprised with this announcement, not with the fact that Quintiq was an attractive candidate for acquisition, but rather why other enterprise and ERP vendors had not pulled the trigger. Then again, the premium paid may account for this move.

Netherlands based Quintiq has dramatically increased its brand profile globally and specifically in the U.S. market. The company’s on premise and cloud-based software offerings include highly customized applications supporting operations, scheduling and supply chain planning, optimization and decision support. This provider boasts of over 500 implementations across 80 countries with many involving rather complex operations and supply chain planning needs.  Many of its applications have been highly customized to support rather unique business, operations and optimization needs.  It is one of very few planning support vendors having an installed base profile in areas such as air traffic control, airline and fleet scheduling, complex process and discrete industry scheduling needs. Co-Founder and CEO Dr. Victor Alles, an experienced computer scientist prides his company in solving planning puzzles that no one else can solve, hence Quitiq’s vertical industry coverage is extraordinary. Supply Chain Matters can attest to that passion after speaking directly with Dr. Allis in November.

With the tag line of the 3D Experience Company, France based Dassault Systemes provides technology to support product design, engineering, CAD modeling, simulation, data and process management process areas.  The current product portfolio is extensive and includes over 190,000 customers within 140 countries. Support for manufacturing industries includes aerospace and defense, engineering and construction, complex manufacturing, medical equipment and other areas.  The firms most high profile customer is Airbus but also includes names such as Medtronic, NASA, Rolls Royce and others.

According to the announcement, Quintiq is being positioned to expand Dassault’s DELMIA suite of offerings which is the product area focused on PLM Digital Manufacturing. This suite includes simulation software capabilities supporting product design, design creation, planning, monitoring and controlling of production processes. Thus, this is one of Dassault’s prime product focus area in supporting new areas of what The Economist coined as the “Third Industrial Revolution, which includes manufacturers leverage of the Internet of Things and Digitally Enabled Manufacturing. Dassault further provides a large services complement in areas of consulting, technology delivery, engineering and other services.  Thus it would appear that this acquisitions positions Quintiq as being strategically positioned to support customized planning and decision-support needs across the broad spectrum of product design production ramp-up, services and product end-of-life.

Of further interest is that this acquisition announcement comes a day after arch rival PTC announced another one of its IoT related acquisitions. Thus, by our view, both announcements are indicators that the PLM technology segment has aggressive intentions to be a player in the new wave of Digitally Enabled Manufacturing.  While each is taking different strategic approaches, the goal seems rather apparent, namely beat other enterprise and ERP focused vendors in depth of support in this new area of product centric decision-support that integrates physical and digital information elements. 

For Dassault specifically, the challenge will be to allow Quintiq to integrate with broader simulation and decision-support needs without being swallowed by complex corporate overhead and complexity.

The takeaway is an emerging new dawning of capabilities that allow manufacturers to integrate and simulate information and make more informed decisions that span the entire product lifecycle.

Bob Ferrari

© 2014 The Ferrari Consulting and Research Group LLC and the Supply Chain Matters Blog.  All rights reserved.