Second in a series of books, “Map Your Best Route to Product Value”, by Jim Heppelmann, President and CEO of PTC, walks through the steps of charting out a company’s best route to success by identifying how to realize value in product development.

Biography

Jim Heppelmann
President and CEO

Jim Heppelmann has product development running through his veins.

The seventh of eight children born on a dairy farm in rural Minnesota, Jim grew up surrounded by heavy equipment and farm machinery. As a young boy, he was fascinated by how things worked and spent countless hours taking apart and putting together bicycles, motorcycles, and various equipment used on the farm.

After his parents sold their farm, the family settled in a small Minnesota town where Jim’s father became an operating engineer, driving heavy equipment for large construction projects. As a teenager, Jim found work at a neighboring farm, where he continued to learn by operating and fixing farm equipment. He had a natural talent and affinity for math and science and became fascinated with engineering when one of his older sisters became a civil engineer. Hearing about her experiences and seeing her job opportunities inspired Jim to look at engineering as a career path for himself - it was the perfect combination of his natural skills and interests.

Jim attended the Institute of Technology at the University of Minnesota and graduated with a degree in mechanical engineering with an emphasis on computer aided design. It was during these years he was first exposed to the field that today is known as Product Lifecycle Management (PLM) through an internship at Control Data Corporation.

By the time Jim graduated in 1987, he already had two years experience with early PLM technology under his belt. Hired full time by Control Data Corporation as a professional services consultant, Jim’s job was to work with customers after the sale to customize the software and make sure it worked properly in the customer’s business. He had a natural talent for the work and quickly gained a reputation for his understanding of customers’ requirements as well as ability to manage and deliver complex projects on time and to the client’s satisfaction. Recognizing Jim’s aptitude for relating to customers, he was recruited into a pre-sales position, where he helped prospective customers understand how Control Data’s software could help them with their product development challenges. Both of these experiences led Jim to focus on how the software could be shaped to better meet customer needs, and after just four years at the company, he was asked to head up product management for the company’s EDL product line.

In1992, Control Data Corporation and SDRC created a joint venture spinoff called Metaphase Technology to focus on Product Data Management, the precursor to Product Lifecycle Management, and Jim was named Chief Technical Officer. For the next four years, Jim drove strategy, product marketing and product management to build what is recognized in the industry as the first enterprise PLM system, winning contracts with some of the world’s leading manufacturing companies, including Boeing, Ford and Daimler.

It was around this time that Jim began to look at the Internet and think about how it could be used in product development and how it might change PLM. At the age of 31, Jim decided it was time to start his own company and bring his vision to life. He left Metaphase to start Windchill Technology in 1996, giving the company a light-hearted name that reflected a land known for its bitterly cold winters.

As Jim was raising money for his new venture, he met with Computervision executives, including then-CEO Russ Planitzer, who immediately saw promise in Jim’s vision. Planitzer offered to provide the seed capital to start the company in exchange for a majority ownership and the rights to market Windchill’s product. Just two years later, PTC acquired Computervision and along with it, the stake in Windchill.

Ironically, Jim’s first exposure to PTC had occurred 10 years previously, as Control Data Corporation was evaluating becoming a PTC reseller. Jim, along with a throng of others, crowded around a small VCR to watch the upstart PTC’s VP of Sales, Dick Harrison, show a pre-recorded demo of a brand-new product called Pro/ENGINEER. Impressed by both the product and the company, Jim wondered how the other CAD companies could compete and imagined someday working there. But in the short-term, he went to work learning Pro/E and looking at how to integrate into Control Data’s EDL product so customers could capture and manage all the data it produced.

So in some ways it was a dream come true when, 15 minutes into his presentation about Windchill to Harrison and then PTC CEO Steve Walske, he was asked if he was interested in selling the rest of the company to them and joining PTC as Senior Vice President of the Windchill Business Unit.

As he had done in previous positions, Jim quickly came to the attention of senior management who recognized his talent, drive and penchant for understanding what customers needed. In 2001, three years after joining PTC, Jim was named Executive Vice President and Chief Technology Officer, responsible for all PTC product lines.

In this position, Jim launched the Wildfire effort that revitalized Pro/ENGINEER with a new user interface and a web services capability that together transformed PTC’s offering and resulted in a rebound in business and years of strong sales growth. Simultaneously he restructured the Windchill product line to create turnkey solutions that were easier to deploy, and drove the introduction of an integrated Product Development System that remains central to the company’s value proposition and competitive advantage today.

In 2003, Jim was promoted to Executive Vice President, Software & Marketing Group and Chief Product Officer, and his responsibilities were increased with additional responsibilities for the company’s marketing function and overall strategic direction. During this time, Jim played a leadership role in the identification, acquisition, and post-merger integration of 12 technology companies that have added important capabilities to the company’s product line. In May 2008, Jim was appointed to PTC’s Board of Directors.

In March of 2009, Jim was once again recognized for his strategic leadership when he was named President and COO. Jim is slated to become CEO on October 1, 2010.

When Jim isn’t working, he has a tendency to go back to his roots. He’s an avid outdoorsman, enjoying fishing, boating and hiking. With his wife of 20 years, he’s built two log cabins and is currently fixing up a farm they bought in a rural suburb of Boston, where he’s introducing their young daughter to the simple pleasures of plowing fields and tinkering with old equipment.

Throughout his career at PTC, on one thing Jim has never wavered. He has advocated tirelessly for the development of his brainchild, Windchill, inspiring developers, sales, marketing and executives to follow his lead. Today that technology accounts for about half of the company’s $1 billion revenue and is the key driver of PTC’s growth and competitive wins.

Q&A with Jim

Jim On What’s Next for PTC and the PLM Industry

Q: What’s on your mind as you officially take on the role of CEO?

Jim: "Let me first say I can’t think of a more exciting time in our history to take the helm. I’m excited to be part of a team that has worked so hard and successfully to bring PTC to where it is today. We have the industry’s leading PLM solution and that business is growing annually at 20 percent; we have an exciting new CAD strategy that promises to change the way people work with CAD tools and unlock a new wave of growth; we have satisfied customers who are getting great value from our products and are choosing us over our competitors; and we have energized employees that are excited about where the company is going and the opportunities ahead of us.

So now, I’m thinking about where we take the company next and how we leverage our leadership. Over the last five to six years, we've carved out a leadership position in our industry, gaining market share, strategic competitive wins and developing a technically excellent product set. Now we need to optimize that leadership position to create more value for our customers, for our shareholders, and for our employees. This means complementing our focus on growth with a focus on more efficiency in all areas of the business and continued predictability around our financial results. "

Q: What does this mean for customers, shareholders and employees?

Jim: "For customers, it means developing and delivering solutions that help them achieve competitive advantage through better product development. We want our customers to have a better process, which on a repeatable basis lets them get more innovative products to market faster, with better quality and lower cost.

For shareholders, it means our commitment to deliver a sustainable 20 percent earnings growth per year. To do that, we need to complement our growth with a higher level of efficiency and predictability each year.

For employees, our goal is to continue to provide a great place to work through a growing company that respects its employees and provides promotional and development opportunities. "

Q: How is today’s economy affecting PTC and your customers?

Jim: "The economy isn't perfect, but it's starting to improve. As our customers look forward to a better economy, they are thinking again about how to create competitive advantage. They’ve done everything they can in terms of operational efficiencies, which can only go so far in creating leadership. The quickest way out of this economic downturn is to get better products to market faster, with better quality and at lower cost. Our customers see this time as an opportunity to put better product development strategies in place that will create an advantage when the economy heats up again.

Q: How do you see the PLM industry evolving over the next 5 years?

Jim: "The PLM industry is going through a dynamic period of evolution. Many of our customers see their PLM systems becoming more strategic to their business than their ERP systems are. As a result, they are looking to us to help them think about their business processes and provide solutions that will optimize their product development strategy.

They are looking for solutions that will support product portfolio decisions, program and project management as well as requirements management through to design. They’re also looking for solutions that will provide analytics around things like environmental compliance as well as quality and reliability management; the ability to repurpose product information into manufacturing instructions and plans; and to further use that information to drive after-market services and the revenue associated with them. They are also interested in using social media techniques to take advantage of the knowledge and input of multiple sources and do more efficient problem solving in a large global organization. We’re also seeing that customers want this big footprint of capability delivered as a system – a collection of software that has been designed to work together. These needs in turn are driving what we are focused on as we enhance our software and services. "

Jim on the Future of CAD

Q: What is Project Lightning and why is it important?

Jim: "Project Lightning is an initiative that is going to shake up the CAD industry. It will challenge conventional thinking about what's possible in terms of ease of use, interoperability between systems and the way dynamic products are modeled into assemblies. It will unlock potential in today’s organizations and allow more people with good ideas to participate fully in the product development process.

It’s also going to remove the barrier of switching costs for our customers, which can stand in the way of moving forward with new technology. "

Q: How will it affect ease of use?

Jim: "A lot of CAD companies talk about their products having an ease of use advantage. In reality, all mainstream CAD products today take at least a week for a new user to come up to speed and you need to use the tool consistently to remain productive. As a result, in most organizations, there are a few expert users and a large number of people that have to stand on the sidelines because the effort to become productive with that tool is too high.

This means in any organization, there are potentially lots of people who are very innovative, who might know what the customer wants, who want to give feedback or have a lot of great ideas, but they're locked out of the process. Imagine a field-service representative who just sat down with a customer who explains what’s wrong with the product. The field rep has to communicate back to product development in text because he or she doesn’t have the right tool to easily model it, communicate it, and incorporate it into the design.

Our new CAD strategy will introduce a learning curve the industry has never seen before. It’s going to allow the process to become much more inclusive for both the mainstream users who use CAD every day, all day long, as well as casual users - - people such as project managers, product marketing professionals or application engineers out in the field. These people might have great ideas to add to product development. Now they will have the ability to easily contribute and add value to the process. Think about the potential productivity gains and increased innovation if everyone involved in product development could truly communicate in the same language.

Q: How will it affect interoperability?

Jim: "The CAD industry, PTC included, has created a situation in which customers have almost given up on true interoperability. They have come to accept that today’s CAD systems don't work well together and believe they never will. And the truth is, today they don’t work well together. This prevents people from being able to use the tool that’s best for their needs, gets in the way of supply chain partners working together and creates challenges when companies with incompatible tools merge.

Our new strategy will challenge this model with an environment that's highly interoperable between tools and modeling technologies. We're going to show customers how data can flow back and forth seamlessly in ways that will amaze them when they see it for the first time.

Q: How will it change Assembly Management?

Jim: "There's an incredible opportunity to rethink the way assembly management is done in CAD tools. For 25 years, assemblies have been produced by creating parts or aligning surfaces or edges and building the assembly from the bottom up. Our customers today are making products every day with so many configuration possibilities that it's completely impractical to model them all bottom up one at a time. So we're going to provide an entirely new concept, an intelligent assembly kernel that is going to make CAD assemblies as dynamic as the real world products they are trying to model. "

Q: What are customers telling you?

Jim: "In the last few months I’ve participated in a number of meetings with long-term customers to give them an early view of what we’re working on and to get their input. Our customers are happy to see so much passion being put behind our CAD strategy. They are excited to see us working to solve longstanding industry challenges they have come to accept with a product that will be compatible with all the data they’ve already created and that will be an easy upgrade. They are telling us this new offering will allow them to work more effectively and save significant development costs.

Q: How does Project Lightning relate to PLM?

Jim: "PLM is really about managing the data and processes that are used to create products and bring them to market. Our CAD product along with our core PLM product, Windchill, are part of an integrated set of products that enhance our customer’s ability to maximize their product development process and leverage all the data that is generated throughout that process. The data from our CAD system will feed our PLM system. By making our CAD system better, we’re actually making our PLM system better as well. Ultimately, we’re making it easier for companies to use and reuse all of this data to develop new products, enhance existing products, and support after market service operations. I think each of our products is strong on their own, but the synergy that exists between them creates an incredibly powerful solution when you put them together.

Press Release

James Heppelmann Assumes Role of Chief Executive Officer at PTC

NEEDHAM, MA. – October 1, 2010 – PTC (Nasdaq: PMTC), The Product Development Company®, announced that James E. Heppelmann, the company's President and Chief Operating Officer has assumed the role of President and Chief Executive Officer, as previously announced on May 10, 2010. Heppelmann succeeds C. Richard Harrison who will serve as the company’s Executive Chairman and continue in a strategic advisory capacity.

"This is an incredibly exciting time to be taking over the leadership of PTC," said Heppelmann. "Our market has exciting growth prospects, our competitive position is strong, our market share is increasing, and our customers see us as a strategic partner who delivers strong business value. We are well positioned to achieve our stated goals and extend our technology leadership in both the PLM and CAD arenas. Our PLM business driven by our Windchill solutions continues to gain momentum as evidenced by expected license growth for Windchill of approximately 70% in FY ’10 and recent strategic wins including EADS, Continental and Target. In addition, "Project Lightning," our vision for the next generation of CAD, will be unveiled on October 28 and is expected to redefine the mechanical CAD market."

Heppelmann continued, "I would like to sincerely congratulate Dick Harrison for the incredible leadership he demonstrated throughout his 23 years of service to the company and am looking forward to working with him in his ongoing role as Executive Chairman."

"It’s been a privilege to lead PTC for the past ten years," said Harrison. "We have planned this succession carefully and I fully support Jim and his vision for the next phase of the company’s growth. I look forward to continuing to serve as Executive Chairman to help leverage and extend the company's strategic business opportunities.”

Learn more about PTC.

Book Series

New Developments in New-Product Development

First in a series of books on Product Development by Jim Heppelmann, President & CEO at PTC

Map Your Best Route to Product Value

Second in a series of books, “Map Your Best Route to Product Value”, by Jim Heppelmann, President and CEO of PTC, walks through the steps of charting out a company’s best route to success by identifying how to realize value in product development.