Issue #1,088 | The Business of CAD | 22 March 2021
Francis Bernard interviewed by David Levin
For the upcoming 40th anniversary of Dassault Systèmes, we offer part ii of an interview with Francis Bernard, co-founder of the company. He was interviewed by David Levin, co-founder of LEDAS Group, which develops software for CAD vendors.
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Levin: How did the idea come about to establish a separate company? It seems to me that a very new company would not be able to organize an effective global marketing strategy of a very new product?
Bernard: Without the partnership with IBM, we would not have established the Dassault Systemes company. It was the key decision factor.
IBM was really like a dream for us: they had 80% of the hardware business at a worldwide level; they already had the experience and organization to sell CAD/CAM software with Cadam; and they were ready to invest significantly in human resources, because each Catia sale generated ten times the hardware revenue for IBM. Revenue from each Catia software sale was shared 50/50 between Dassault Systemes and IBM.
Levin: What were the biggest challenges for the company as it grew from 20 to 100 people, and then from 100 to 500 people?
Bernard: The biggest challenges were to hire, train, and manage people according to six macro-processes that we decided to implement:
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Plan: Vision and strategy definition and optimization
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Define: Product management to address all markets (aero, auto, and so on)
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Implement: Product development using hardware and software of the time
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Sell: Marketing and sales in close cooperation with IBM
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Team: Ecosystem management with technical partners and IBM
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Customer Service: Customer loyalty through a strong maintenance process with IBM
We never faced a financial threat because revenues grew quite well and so we were profitable from the beginning.
Levin: Did you invent the company’s management processes or did you adopt them from Dassault Aviation?
Bernard: At the end of the 1980s, when we were more than 200 people, we contracted with consultants specialized in human resources management (not from IBM), to help us implement a clear company vision, along with a strategy (both technical and commercial) to implement the vision, and an execution system to execute the strategy and motivate our people.
On the other hand, we learned from IBM how to manage the software maintenance organization and process, as well as the definition of the pricing policy.
Levin: Obviously, the marketing power of IBM has very much helped you to gain customers such as Honda, Mercedes, BMW, and Boeing. Did demonstrations of Catia speak for itself, or did you have more personal methods of convincing major customers?
Bernard: IBM was in fact not involved with the very first customers, as I explained above [in part i].
I got personally in touch and met the executives in charge of CAD/CAM at Honda, Mercedes, and BMW to present and demonstrate Catia. The quality of these discussions generated the conviction at Dassault Aviation that Catia had good business potential.
This generated a lot of motivation for my team and me, and it was a catalyst to convince IBM that we could be a good partner for selling more computers! These three customers (and a few others, such as Grumman Aerospace in USA and SAFRAN in France) were direct customers to Dassault Systemes and became IBM customers only a few years later.
Boeing is a different story. This was a very long battle to win, because my biggest competitor was an internally developed 3D CAD software package. And here the power and credibility of IBM together with our experience in airplane design at Dassault Aviation was essential.
I remember a question from the Boeing CEO when I met him in Seattle: “Please tell us how we can design an airplane in 3D,” and then his comment when he decided for Catia in 1986: “I selected Catia because I am confident in you, but I buy it from IBM because I cannot take the risk in implementing a major business transformation with too small a partner.”
Levin: How did you manage the balance between the need to satisfy customers and your own vision of the optimal (with respect to business) development of the software?
Bernard: This is called “product management.” The process of product management is to collect and analyze all of the requirements generated by customers and prospects, to look at the competition, to support the development of IT, and to invent opportunities that are not yet visible to the market.
These inputs are the source of new deliveries of functions, based on the optimization of the revenue potential. As a matter of fact, product management is measured by success on the market.
At Dassault Systemes, each new software delivery is identified by a version number and a release number, VxRy. A new version number means that significant improvements were implemented in the structure of the software, most times to support major hardware developments, which makes it impossible to be fully compatible with the previous version.
Of course, tools are delivered to migrate the data from one version to the next. We announce a new version every five to ten years to support changes in hardware, from mainframes to Unix workstations and then to PCs.
By contrast, a new release of a given version is always fully compatible with the previous release. In other words, V5R8 is fully compatible with V5R7.
To manage the release process properly and to generate confidence in the sales team as well as from customers, it is essential to be time-driven. Therefore we delivered a new release around May and October each year.
It may happen that a customer requests an enhancement not planned for a future release, or our development takes too long for the customer. In such cases, we enter into negotiation. Should the enhancement request have sufficient business potential, we may accelerate its development and require the customer to fund up to 50% of the development cost, with Dassault Systemes keeping full ownership rights of the enhancement developed.
If the enhancement does not have sufficient business potential (usually because it is specific to the customer), then we may develop the enhancement under a standard service contract funded 100% by the customer, who keeps the ownership rights to the enhancement.
Levin: Could you mention several people who were especially close to you during your Catia and Dassault Systemes years?
Bernard: This is a difficult question, because everybody contributed in some way. But let me give you some names. The key members of the initial team at Dassault Aviation and at the beginning of Dassault Systemes were
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Dominique Calmels as my Technical Director until 1990. (He passed away in 2017.)
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Didier Boucier as a key technical specialist who was a major actor in the development of Catia. (He retired in 2019.)
Then at Dassault Systemes there was
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Charles Edelstenne, Dassault Systemes board chairman, a clever businessman and one of the ten richest men in France. (He was also a former CEO of Dassault Aviation and is now president of Dassault Group.)
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Thibault de Tersant, who joined Dassault Systemes in 1986 as financial director, an excellent negotiator of acquisitions and support of large customers, as well as the management of pricing.
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Bernard Charles, who joined Dassault Systemes in 1984, who became technical director in 199, and then CEO in 1995. An ambitious leader with a very large ego.
I do not like Charles Edelstenne and Bernard Charles from a human point of view, but I respect their significant contributions.
Levin: What are some key reasons for the success of Dassault Systemes?
Bernard: Let me give you a high-level summary:
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To be at the right place at the right time; this was the luck or the opportunity that we realized only years later, in that we took advantage of the IT revolution, the Cold War, Dassault Aviation, then globalization
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To invent a major transformation with a long-term vision: “3D for all”; this was more than just inventing a gadget, it was the 2D-to-3D revolution thanks to IT
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To make the right strategic decisions: the creation of a Dassault Systèmes independent of Dassault Aviation; the IBM partnership; the strong ecosystem of partners; partnerships with customers; and well-targeted acquisitions
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To set up a robust management and execution system
Levin: What are five of the most important milestones during your time at Dassault Aviation and Dassault Systemes?
Bernard: This is a difficult question to answer, because there were dozens of important events. Here are five:
1967: My decision to join the aerodynamics department where the IT was initiated
1968: My first CAD software, which created and smoothed curves, which became part of the initial Catia release ten years later
1977: The start of Catia development
1981: The launch of DS’s partnership with IBM
1986: Landing Boeing as a customer
Levin: What do you consider to be the most interesting CAD trend you observed during the last decade?
I am not very much involved anymore, but I do see two major trends:
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The development of the IT platform on the cloud
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The beginning of the implementation of PLM concepts in the medical domain: a numerical definition of the human body; analysis and simulation of its functions; maintenance and correction of deficiencies; and so on.
Levin: Do you agree that CAD has become less important in the contemporary IT world? Perhaps there are not enough ambitious challenges for CAD to address now.
Bernard: I believe that it is like a concept of layers: more and more, CAD will become a de facto set of basic functions. Applications using these basic functions will be the visible part of a system.
Levin: The role of AI in CAD software is still quite limited, especially compared to other areas. Do you expect a breakthrough here?
Bernard: Yes. As I briefly described earlier, CAD may become an invisible layer below the AI layer.
Levin: What do you think about cloud-based CAD modeling? Will it replace traditional CAD on the desktop, or will it remain a niche solution for students and small businesses?
Bernard: I believe that the cloud is just a new platform, making it easier to integrate and to communicate. It will probably not replace the desktop, but will become a complementary option for most customers.
Levin: Sometimes it seems to me that MCAD, in its classic meaning for manufacturing, is to some extent already exhausted. It is very effective, but any great new thing can hardly be done. If so, there could be two ways in particular for progress in business and technology: (1) CAD + real artificial intelligence, and (2) expansion of technology to new domains, such as medicine and finance. What do you think of this?
Bernard: Yes, AI will become a major part of the future.
Yes, new domains like medicine will be addressed; Dassault Systemes acquired recently Medidata in USA to go in such a direction. Finance, I am not sure because it is not at all related to shapes and physical/chemical simulations and it is already addressed by CRM and ERP applications.
And never forget: it is basically impossible to predict a development in technology more than ten years in advance. I like the quote from Henri Ford (1863-1947): “If I’d asked customers what they wanted, they would have said ‘a faster horse’.”
Levin: What are the criteria for a CEO to quit the position? What do you think is the difference in success and time limitations for keeping a top position as the CEO of a company and the president of a country?
Bernard: Any CEO will be replaced, because he is retiring, or he is not productive enough, or he is in conflict with the shareholders or the employees, or he wants to quit for another position, or ultimately he dies. The question is to manage this process with no negative impact, and, if possible, a positive impact on the company, the employees, and the shareholders.
In my case, there had been a kind of agreement between Charles Edelstenne (board director), Bernard Charles (technical director), and myself as CEO. Bernard Charles was younger than me by 18 years, more ambitious (a killer), and more motivated than me to manage the exponential growth of the company.
I am not an ambitious killer; I am just passionate to work for and with people and customers all around the world. Charles Edelstenne arbitrated an agreement to transfer the CEO position to Bernard Charles and to let me address new markets at the time and emerging countries. (See my earlier response on Russia). The process went quickly and smoothly, without any frustration or trouble.
The success criteria for a CEO is to meet the company’s objectives in terms of revenues; for the president of a country, it is to be re-elected.
The limitation for a CEO is the company’s performance; for a president, it is the support of the chambers and the electors. Of course, I mean this for a democracy that is like a company in which the customers are the electors! The more a state looks like a dictatorship, the more it looks like a company with no customers!
Levin: As an advisor and a member of the board, you have contacts with a lot of companies and startups. Which are the most interesting to you?
Bernard: I have contacts only with startups in the digital domain with B2B [business to business] solutions. This is related to my past experience with Dassault Systemes, CAD, and PLM. But you must recognize that Dassault Systemes was not a startup but outsourced from Dassault Aviation. As long as we had Dassault Aviation as a reference, a good motivated team, and the IBM partnership, the risk was limited.
When I look at a startup, I verify the vision (a statement with a clear objective) and the product (what is the value to the customer? is it a must-have solution?) with the early customers, the competition, the team (is the leader heading a reasonable management structure?), and the ecosystem. In our complex environment, a startup without technical and/or sales partners has nearly no chance to succeed.
[This article first appeared in isicad, and is reprinted with permission. The interview has been shortened from its initial form.]
And in Other News
Open Design Alliance launches its Strategic Interoperability Group (SIG) to extend interoperability through member-led initiatives that could include file formats (other than those already supported, like DWG), digital twins, and scan-to-BIM.
Existing SIGs [special interest group] already handle ADT and RVT. “More than 60 companies now use ODA Revit support in of their software,” reports Randall Newton. https://www.opendesign.com/sig
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ARCHLINE.XP 2021 is now available and offers real-time elevations and sections, schedules with images, rule-based filters, certain kinds of automated dimensions, and push/pull for 3D conceptual modeling. Get video overviews of what’s new through archlinexp.com/webinars.
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Siemens updates Simcenter STAR-CCM+2021.1 to open simulation files in read-only mode, thus not using up a license. Surrogate Models predict the performance of thousands of variations. Engineers can sketch complex circuits with the new Electric Circuit Editor.
The software is now AWS HPC [Amazon Web services high performance computing] Competency certified. More details at blogs.sw.siemens.com/simcenter/simcenter-star-ccm-2021-1/
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Vectorworks releases service pack 3 of its eponymous software with direct connections to Solibri and Twinmotion, and improved IFC exports. The 30-day free trial of Vectorworks Designer is downloadable from vectorworks.net/trial/form (after registration).
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nPower Software ships Power Surfacing (sub-d organic modeling) and Power Surfacing RE (reverse engineering) v6 for Solidworks with power shell and power thicken, multi-directional mirroring, new quad wrap that automatically fills most holes, updated shrink wrap that checks for self-intersections, and new mesh smoothing that applies to the whole model. More info at npowersoftware.com/pressreleases/pressreleasePowerSurfacing60.html
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Here are posts that appeared recently on my WorldCAD Access blog:
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Observation: People tracking is so insidious
You can subscribe to the WorldCAD Access blog’s RSS feed through Feed Burner at feeds.feedburner.com/WorldcadAccess.
Letters to the Editor
Re: Q&A With the Inventor of Catia
I read with great interest your Catia article and took special notice of your picture of Mr. Dassault working on a Catia workstation.
As a long retired drafter who morphed from hand drafting to CADD, I remember learning CADD on an IBM Fastdraft system in 1984. It looked much the same as shown in this picture. It had two 19" black-and-white monitors and you drew using a light pen. The CPU unit was the size of a refrigerator and only had 11MB of memory. I saved my work to 11" floppy disks and plotted to an IBM pen plotter.
Cost of this two-monitor system was $125,000. It did include a service contract. Might the Catia system be the same system marketed by IBM as Fastdraft?
- Bob Melusky
The editor replies: I think it is a different system. IBM sold quite a few different CAD programs over the decades. For instance, I have a copy of IBM CAD/3X V3R2 ($99 back then in 1993), which was a 2D CAD program for DOS and OS/2 derived from IBM’s Altium CAD/PCB design group. (It’s interesting to see IBM targeting AutoCAD 12 users.)
From the official IBM history site, I read that in 1982 IBM introduced “the 6361 Fastdraft System, a low-cost drafting system using a light pen and a CRT screen.” I think that it looked similar to Catia because CAD systems used similar hardware in those days.
It was great to read your remembrances!
Re: CAD for Chrome OS is Possible in 2021
FWIW. Onshape, on Chromebook, a big reason Onshape recently surpassed +1M users in education. Onshape on Chromebook is excellent.
- Joe Dunne, PTC
The editor replies: Onshape is CAD that runs in browsers, as do many other CAD programs, such as AutoCAD Web and ARES Kudo, whereas I am advocating for native apps designed for tablets that run with no Web connection on Chromebooks through Android, like Krita for paint programs.
Notable Quotable
“We are looking for like-minded people to join our diversity committee.”
- Management Speak (@managerspeak on Twitter)
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