It makes for big news when a significant aerospace & defense (A&D) player such as Lockheed Martin Aeronautics decides on the technological path they want to take when moving into the future. Currently, Lockheed Martin stands as a leading A&D developer and manufacturer of multirole combat jets, satellites, defense systems and other advanced-technology systems and services. Its Aeronautics segment, which has made a big deal with Siemens Digital Industries Software, accounts for about 40% of the Lockheed Martin’s 2021 net sales of around $67 billion. 

The recent announcement that Lockheed Martin Aeronautics made a big bet on Siemens Digital Industries Xcelerator PLM portfolio is not only a technologically significant step, but also a substantial financial investment. This deal will undoubtedly affect the competitive environment in this industry segment—not only by enabling Lockheed Martin Aeronautics to maintain and evolve its world class technological leadership, but also by helping Siemens continue to be a leading supplier and developer of high-quality PLM and automation systems. In the latter case, it will maintain Siemens’ place in the A&D space, specifically when it comes to tough competition—primarily Dassault Systèmes, but also PTC and some of the more sub-PLM oriented software developers, such as Ansys in simulation and analysis.

When a company the size of Lockheed—or one of its major business units—chooses a path, the effects are felt across multiple areas, from considerations of geopolitical security and military development lines to the concrete product innovation, development and manufacturing processes within the organization. Why is this the case?

Lockheed Martin—with its global, military A&D significance—has almost 115,000 employees (about a quarter of which are in the Aeronautics business unit), its 2020 expenditure on research and development (R&D) was around $1.3 billion and approximately half of the company's annual sales were made to the U.S. Department of Defense. It is easy to see why the bets Lockheed makes have broad impacts.

A Key Contributor to Siemens Aerospace & Defense Success

Engineering.com discussed Lockheed Martin Aeronautics’ recent PLM investment in Xcelerator tools with Dale Tutt, VP of Industry Strategy at Siemens Digital Industries Software and spokesperson for Siemens’ A&D division.

Tutt joined the company three years ago with all the relevant qualifications for this complex arena. Prior to Siemens, he worked at Virgin Galactic’s sister company, The Spaceship Company and prior to that at Textron Aviation/Cessna Aircraft. There is more on his CV, but it all illustrates competency applicable to his new Siemens responsibilities to define the industry strategy and leading the realization of industry solutions for A&D customers. In this position, he has been a key contributor to Siemens’ A&D industry success.

Look at these examples from the last twelve months:

• U.S. Air Force decided to standardize on Siemens Digital Industries Software’s PLM/cPDm solution Teamcenter for collaborative Definition management. 
• Northrop Grumman announced that the Xcelerator portfolio will be used to complement company initiatives and harness digital technologies across numerous product lifecycle environments to accelerate the development of new products.
• Boeing’s tough competitor, Airbus, selected Siemens Mentor solution Capital E/E systems (Electrical/Electronic) to accelerate the development of commercial aircraft. 
• Military aircraft giant Lockheed Martin Aeronautics took a big bet on Siemens PLM portfolio Xcelerator.

The list could be longer, but overall indicates that Siemens is gaining the upper hand in terms of 2021 growth and is strengthening its position in the technological and commercial battle in the aerospace and defense industry segment. Generally, according to CIMdata’s 2021 numbers (covering 2020) automotive and transportation is number one, with global PLM-related investments worth around $8.2 billion in 2020. This is closely followed by mechanical machinery/heavy equipment, and A&D with around $5 billion each.

Who is the Leader in the A&D Segment?

Who is leading depends on exactly what we’re looking at. According to appsruntheworld.com in 2020, “the top ten aerospace & defense software vendors accounted for 53 percent of the global A&D applications market which grew 0.9 percent to approach nearly $5.34 billion in license, maintenance and subscription revenues.”

Moreover, they state that Dassault Systèmes led the pack with an 8.7 percent market share riding on a 5.5 percent jump in A&D license, maintenance and subscription revenues. Microsoft was number 2, followed by Autodesk, Cadence Design Systems and Siemens PLM Software (the former name of the PLM division before they changed their name to Siemens Digital Industries Software last year). In terms of percentage Siemens had approximately a 5 percent market share. This assessment may well have changed during 2021, considering several big Siemens orders over the course of the year, of which those mentioned above are examples. The numbers for the full year of 2021 aren’t ready yet.

A general observation is that Dassault still holds the lead in the CAD area with CATIA, while Siemens dominates PLM/cPDm and the role of a “single source of truth” product data backbone.

“But these positions are about to change,” believes Dale Tutt, pointing to Siemens’ growing technological strength and driven portfolio software integration, as well as its recent commercial successes.

A Long-Standing PLM Customer

Understandably, Tutt doesn’t want to reveal how much Lockheed Martin Aeronautics’ investment is worth in dollars, number of seats, services, or exactly what software it covers.

In any case, it’s clear that the Lockheed Martin Aeronautics’ order is extensive and affects a vast amount of software in the Xcelerator portfolio that might include such PLM and automation applications as Teamcenter (PLM/cPDm), NX (CAD), Simcenter (analysis & simulation), Mendix (low-code app solution), MindSphere (IIoT operating system), Opcenter (Operational Technology/MES) or more.

Another part of this story is the fact that Lockheed Martin Aeronautics has historically been a long-standing customer of Siemens. When considering the projects Siemens’ software has been involved in, the F-35 family of single-seat, single-engine, all-weather stealth multirole combat aircraft stands out. Here, for example, Siemens’ cPDm solution Metaphase was initially used, and was later updated to a more modern version of Teamcenter PLM. However, on the CAD side, design was done in Dassault’s CATIA. This combination is in no way unusual.

“True, they have used a mix of software in this project,” says Tutt. “Besides Teamcenter, we’re talking about some of our simulation, manufacturing and other solutions that they’ve built up over the years. Of course, mixed with other domain-specific solutions. A typical problem of any model program, for example the F-35, is that you tend to end up with a number of often somewhat disconnected solutions. In this case, it’s a cross-section of engineering and manufacturing solutions, of which CATIA is one, used in the F-35 design.”

An Environment About to Be Changed

All of this leads to a mixed environment—but is that about to change?

“Lockheed Martin Aeronautics is a leader in the aerospace industry, and their decision to expand adoption of Siemens’ Xcelerator portfolio enables driving digital initiatives and winning programs,” said Tony Hemmelgarn, President and Chief Executive Officer, Siemens Digital Industries Software in a press release. “ Building off of our experience on the F-35 program, and through close collaboration, Siemens is excited to help Lockheed Martin accelerate production and meet DoD contract requirements for both current programs and new initiatives.”

The multi-year contract implies that Lockheed Martin Aeronautics will use Xcelerator to achieve its goals for "mission-driven digital transformation by accelerating program life cycles, driving cost savings and promoting greater innovation."

This is good for Lockheed Martin when it comes to developing next-generation solutions. But it is also good for Siemens—in addition to developing leading technology, it also strengthens what Tutt describes as their “leadership in A&D.”

Which departments in Lockheed Martin Aeronautics will be covered by the new deal?

Tutt naturally hopes that they will adopt the whole Xcelerator portfolio across the entire organization, but initially it looks like the Aeronautics unit is where it will happen on a more broad base. Tutt says, “When they did the evaluation, the backdrop was to meet business challenges to go faster, reduce cycle times and manage the costs better, among other things… To reach these objectives, they looked at the Xceleratior portfolio, at everything from advanced design, electrical systems design, wing design, fuel systems design, all the way down to manufacturing and to the logistic product and maintenance support once the aircrafts are fielded.”

These angles tell us something of which key advantages Lockheed Martin wanted to leverage. By establishing an end-to-end capable solution such as the Xcelerator portfolio, an interesting objective could be to utilize long-running integrations on the market, especially if you include manufacturing automation.

Beyond the Product Names

The Xcelerator portfolio covers many areas with its rich web of solutions and apps—so which specific software are we talking about when it comes to last week’s announcement? An educated guess is that Teamcenter and NX are the main components.

The important point is the high level of integrated solutions that Siemens can offer around mechanical, electrical, software and manufacturing design. “Instead of thinking of different product names here and there, it’s really about the full spectrum of products through engineering and into manufacturing and further on,” says Tutt. “Beyond just the product names, I want to emphasize that the digital tools we can put on the table represent fully integrated end-to-end processes.”

This is primarily where Lockheed Martin could start to drive huge benefits. When we talk about Xcelerator, the discussion circles around aspects such as the comprehensive digital twin, digital threads and flexible eco-systems. Bringing these solutions and partners in product realization together is one of the secrets to providing acceleration in the general digitalization process, as well as superior business value.

Thousands of Seats, But No Exact Numbers Revealed

In a case such as Lockheed Martin Aeronautics’, we are talking about many software seats and it is always interesting to know more about the details here. But Tutt does not reveal any specific numbers.

“No, we don’t have specific numbers that we can share,” he says. “Since this contract is extending to existing programs, new programs and legacy programs, it is impossible to determine any exact figures. But generally, we’re talking about thousands of people in the larger organization, so it’s a large number of seats.”

Tutt adds that this deal is much more than just a renewal; we are looking at a full competitive scenario.

Cutting Corners with the Cloud and XaaS

“Go faster” appear to be the intent of the deal. However, there are other interesting effects. Tutt claims that large deployments such as thishave always been painful for big companies. But there is another side to the coin: changes can sow seeds that will make people think outside the box.

For example, Siemens Xcelerator is now available as a cloud service, called Xcelerator as a Service, or XaaS. At Lockheed Martin Aeronautics, Siemens had the opportunity to change how the company viewed cloud services delivery.

“In one example, we demonstrated how cycle time reduction can be improved by not only delivering a new set of digital capabilities to the engineer, but the speed at which those new capabilities arrive in the hands of those designing, building and maintaining the platform,” says Tutt.” XaaS plays a critical role in enabling this type of advantage and allows for the scaling of capabilities across the enterprise or within a specified program.”

“When we started having this discussion with them, we within the cloud environment were able to demonstrate how quickly we can bring new solutions to them, and how quickly people can gain speed in the new solutions. I think that a lot of companies are stuck in that this is a paradigm hard to get through and really don’t realize that within a cloud environment like XaaS we’re able to deploy solutions quickly, that they are easy to configure and that we can make the organization operational much faster.”

“Having been through several of these migrations in the past, my personal experience is that, yes, it can be hard. But what we did now was to demonstrate that there are other ways of doing this, ways that really can help you to go through these processes much faster,” Tutt replies.

Why is Siemens’ Lockheed Martin Aeronautics Order Important?

My impression is that these big A&D players, such as Lockheed, Raytheon or Boeing, as well as many others in the industry, still sit in a system architecture with quite a number of elements of non-integrated tools. I discussed the matter with Saab Aeronautics (a sister company to Saab Defense Group), the Swedish developer of the lightweight fighter aircraft J-39 Gripen.  I spoke with enterprise architect Johan Tingström and technical fellow Erik Herzog, who pointed out that this lack of deeper integration has a few main effects: many manual import and export activities, and limited traceability if, or when, proprietary interfaces cannot be used.

These pieces, plus a few other considerations, lead to the conclusion that a new architecture for PLM support could provide a lot of benefits—but what are the conditions for a new system?

A simple description is that this means the platform you build up must be characterized by the possibility of exchanging or jumping between modular units in the systems, without extensive migration activities or adaptations. This can be seen as absolutely critical to success.

Here are some requirements:

1. It must be possible to establish life cycle management in every domain.
2. There must be opportunities for tailor-made support in disciplines such as systems management, mechanics, software and electronics.
3. A crucial point would be to have a modular, well-connected and cross-over open platform solution where individual domain environments can be replaced without installation or migration problems.
4. Support for standards, capable of covering changes in PLM systems over time

The Best Integrated PLM and Automation Portfolio in Product Realization

A structure that can meet these requirements should provide support for all engineering and management activities within each discipline. At the same time, these must be fully integrated into a company-wide platform whose individual components can be upgraded independently of the others on the platform.

In addition, as mentioned above, all processes related to engineering work, such as systems development, software development or mechanical development, must be able to be done in dedicated environments. The processes and workflows, within these environments, must take place with traceability, storage and divisibility with relevant accessibility limitations for things as project management, configuration responsibility and related engineering.

Siemens Xcelerator can meet most of these requirements with specific strengths in terms of:

• Advanced design capabilities
• Digital twins and threads
• BOM verification and management modules
• MBSE (Model-Based Systems Engineering)
• Advanced simulations tools
• Software management
• Electrical systems

And it can integrate them all with product development, automation and smart manufacturing with its solutions for virtual commissioning.

But the main point is the Xcelerator portfolio’s software richness and integration.

It could be said that no competing platform can beat them on this front today—and that’s the secret of Siemens’ recent A&D success.