The Importance of a strong digital backbone in SaaS-Based Digital Transformation
Businesses are embracing digitalization for the agility, speed and innovation needed to maintain a competitive advantage. Software as a Service (SaaS) has quickly become a catalyst for digital transformation since it fosters global collaboration and innovation at a lower cost of adoption.
In fact, according to Fortune Business Insights (January 2025)1, the global SaaS market is projected to grow from $317.5 billion in 2024 to over $1.2 trillion (USD) by 2032. This rapid growth is expected to come from the due to need for flexibility due to more volatile market conditions, an increase in remote workers, the rise in public and hybrid cloud-based technologies, integration with other tools, shared data-driven analytics and new cloud-based business strategies through partnerships. But as businesses increasingly turn to SaaS solutions to drive their digital transformation strategies, it is clear that a robust digital backbone is essential for any successful SaaS-based digital transformation.
SaaS as a catalyst for digital transformation
Before diving into the importance of a digital backbone, it is necessary to understand why businesses are increasingly turning toward SaaS for their digital transformation. SaaS eliminates the need for expensive hardware and internal IT infrastructure while providing immediate access to robust industrial software tools across engineering domains, with seamless integration and software interoperability across a common and secure data backbone.
SaaS also provides users with a broad range of specialized software and the ability to easily adopt new software and technology as soon as it becomes available, including the latest technological advances in AI, advanced robotics and the industrial metaverse, which are progressing at an exponential pace. This fosters global collaboration, innovation and agility. Additionally, SaaS offers scalability and flexibility through tiered packages, allowing businesses of any size to adjust as their needs evolve. Enhanced security, automatic updates and ease of access for remote employees further make SaaS an attractive option. Leveraging a robust SaaS offering that includes customer support, AI insights, and industry-standard security provides companies with an out-of-the-box production environment.
The role of a digital backbone in SaaS solutions
A well-integrated Product Lifecycle Management (PLM) system is the single most critical component of a company’s SaaS strategy for industrial software. It serves as a digital backbone for an organization’s engineering IT infrastructure, enabling the seamless flow of data across various applications and systems. It ensures that all components of the digital ecosystem are interconnected, allowing for real-time data sharing and collaboration in a secure environment. This interconnectedness is crucial for businesses to remain agile and responsive to market changes.
A robust digital backbone is essential for optimizing design, engineering, and manufacturing processes. Ultimately, the PLM system is what drives collaboration and process innovation. By leveraging a strong digital backbone, organizations can ensure the efficiency and effectiveness of their digital operations, supporting comprehensive data management and integration across all levels of the enterprise.
The data fabric: A key component of the digital backbone
Leveraging a strong digital backbone as the foundation, companies can add digital thread solutions that weave together data from across the business into a digital fabric for seamless data management. This approach ensures that data is not siloed within individual applications but is accessible and usable across the organization.
A strong digital backbone also enables companies to embed data management directly into their authoring tools to create a seamless data flow that supports the entire product lifecycle, from design to manufacturing. This interconnected data fabric enables organizations to derive higher-quality insights and make informed decisions earlier in the process.
Driving innovation with AI and SaaS
The integration of AI capabilities into SaaS solutions is another area where a strong digital backbone plays a crucial role. AI relies on access to vast amounts of data and computational power, which are often beyond the reach of on-premises solutions. SaaS provides the ideal delivery mechanism for AI capabilities, allowing businesses to leverage predictive and generative AI without the need for extensive infrastructure investments.
A comprehensive approach to AI and SaaS should be centered around connecting data across various domains and creating a rich context for AI applications. This integration enables businesses to achieve meaningful insights and drive innovation. By further enhancing the value of SaaS solutions, this approach positions organizations as leaders in the digital transformation space.
IDC recognizes Siemens with 2024 SaaS customer satisfaction award
A strong digital backbone is crucial for SaaS-based digital transformation, ensuring seamless integration, data management, and improved customer experiences. At Siemens, our commitment to SaaS and a robust data backbone underscores its pivotal role in the digital transformation landscape. By leveraging advanced technologies and providing a secure, scalable, and flexible SaaS ecosystem, Siemens enables businesses to innovate and collaborate effectively. For instance, Siemens’ NX X cloud-based 3D CAD/CAM tool includes basic data management built on Teamcenter X technology out-of-the-box and seamlessly integrates with the Teamcenter X-based data backbone, allowing engineering teams to collaborate in real-time and optimize their designs and processes. And Siemens’ SaaS solutions are designed with industry leading security measures including advanced data encryption, multi-factor authentication and compliance with global privacy regulations. This ensures customers’ data and processes are protected while benefiting from the agility and scalability of the cloud.
Siemens’ comprehensive suite of tools and services, coupled with industry-standard security and continuous investment in cutting-edge solutions, positions us as a leader in driving global competitiveness and operational excellence through digitalization. This dedication to excellence was recently recognized when IDC Research honored Siemens with its IDC SaaS Award for best PLM/CAD vendor based on customer satisfaction across 2,900 companies worldwide.
With Siemens’ SaaS offerings, companies can confidently navigate the complexities of the modern business environment, ensuring sustained growth and success in an ever-evolving market. To learn more about Siemens’ SaaS offering visit Siemens Xcelerator as a Service | Siemens Software.
Siemens Digital Industries Software helps organizations of all sizes digitally transform using software, hardware and services from the Siemens Xcelerator business platform. Siemens’ software and the comprehensive digital twin enable companies to optimize their design, engineering and manufacturing processes to turn today’s ideas into the sustainable products of the future. From chips to entire systems, from product to process, across all industries. Siemens Digital Industries Software – Accelerating transformation.
