Every consumer knows about the growing role of artificial intelligence (AI) and wirelessly enabled digital technologies in our daily lives. But not everyone knows about the seismic shift these developments are having on the manufacturing industry and the role that an industrial software company like PTC (NASDAQ: PTC) is playing in it.
The increasing adoption of these technologies will amplify the value added by PTC to its manufacturing customers and lead to significant growth for the company for many years to come.
The first Industrial Revolution was characterized by the development of steam power and the beginning of mechanical production. The second began with the ushering in of electricity and mass production, and the third with the development of the information age (semiconductors, computing, and the internet).
The fourth industrial revolution refers to the new age of integrated smart digital technologies that work together iteratively in real time. These technologies greatly benefit the manufacturing industry, and PTC's software plays a pivotal role in them.
The so-called closed-loop digital thread lies at the heart of PTC's software. This refers to how digital technology gathers data across a product's entire life cycle, monitoring and analyzing it iteratively to improve the process. This process runs from initial design to manufacturing, servicing, and disposal.
For example, a product is designed using PTC's computer-aided design (CAD) software. The design then develops a manufacturing process using PTC's product life-cycle management (PLM) software, which monitors and controls production.
Meanwhile, PTC's Internet of Things (IoT) software connects the process to the digital world, and its augmented reality (AR) solutions digitally augment manufacturing. PTC's software life cycle management (SLM) then manages the product's servicing.
These processes and seemingly disparate software solutions work together to improve the whole closed loop iteratively. For example, a PLM analysis might indicate a need to change the design (CAD) to improve manufacturing productivity or quality, or a change in design might result in a change in the servicing or manufacturing of a product, which can be digitally predicted.
In the words of CEO Neil Barua on a recent earnings call, PTC's customers have said they need: "to shorten our development timelines as quickly as possible with the highest quality to remain competitive. This includes our hardware, mechanical, electronic, and embedded software processes that all need to come together for a final product."