New Analyst Report on Procurement’s Role in Ensuring Profits from Product Innovation Cites PLM Technology as Key Enabler

Latest Aberdeengroup Research Series Indicates “Best-in-Class” Companies Improved Time-to-Market By 10 to 20 Percent by Including Procurement Early in Product Design Process

Thursday, May 4, 2005, PLANO, Texas – UGS Corp., a leading global provider of product lifecycle management (PLM) software and services, today announced that a new AberdeenGroup report, titled Procurement in New Product Development: Ensuring Profit from Innovation, cites the role of PLM technology as a key enabler of profitability through its ability to involve procurement considerations early in the product development process. The report points to reduced product costs and up to a 20 percent improvement in time-to-market by “best-in-class” companies that collaborate with procurement earlier in the design process and make sourcing decisions a higher priority during the early phases of the product lifecycle.

In the report, AberdeenGroup analyzed the performance of survey respondents to its Product Innovation Agenda and The CPO’s Agenda benchmark studies to conclude that along with the lowered cost and increased efficiency of early and broader sourcing involvement, increased collaboration can also increase product revenue by tapping into new sources of innovation.

“Our research indicates that leading companies are making procurement and sourcing decisions a key part of the product development process, and have made significant organizational and process changes to support early procurement collaboration,” said Jim Brown, vice president Global Product Innovation and Engineering, AberdeenGroup. “PLM technology can play a key role in enabling the introduction of sourcing collaboration in the context of product development which, in turn, creates real business value.”

According to the new AberdeenGroup report, “Best-in-class companies are using PLM-related solutions that integrate data from diverse sources and provide both centralized date repositories with change management, and version and authorization controls and applications that automate and manage processes that reach beyond engineering. The solutions are ideal for ensuring communication, collaboration, and control across dispersed teams and can help capture knowledge and learnings that enable process improvement.”

Teamcenter closes the gap between product development and procurement
UGS’ Teamcenter® software, the world’s most widely used PLM software portfolio and winner of IndustryWeek’s 2005 Technology of the Year Award, closes the gap between product development and procurement, helping companies to realize the business benefits identified by AberdeenGroup. Through its Supplier Relationship Management (SRM) capability, Teamcenter provides a proven portfolio of configurable strategic sourcing solutions that allows procurement professionals to provide input in all product lifecycle stages beginning with design decisions in the product development process. This fully-integrated web-based suite of leading edge sourcing technologies engages the entire supply chain by creating a direct, efficient connection between product development, procurement and suppliers to support better cost management throughout the entire product lifecycle process.

The result is a shortening of the design process allowing companies to release new products more quickly and cost-effectively, ultimately improving the top and bottom line simultaneously to achieve a competitive advantage. Additionally, procurement and supplier collaboration in later product lifecycle stages make it possible to continue to reduce production costs, explore part reuse, maintain competitive advantage and extend the economic product lifecycle. Teamcenter’s robust analytics allow users to view data in an actionable format, and capture this knowledge to enable process improvement.
“Teamcenter directly addresses the technology gap between engineering and procurement that drives product cost benefits identified in this new AberdeenGroup report,” said Steve Bashada, vice president of Teamcenter applications, UGS. “Furthermore, because Teamcenter’s SRM functionality is integrated with the entire Teamcenter PLM portfolio, it delivers unparalleled design to source functionality.”

Aberdeen’s report, Procurement in New Product Development: Ensuring Profit from Innovation, was sponsored by UGS and can be downloaded at no charge from the UGS web site at http://www.ugs.com/products/teamcenter/?strategic.

About AberdeenGroup
Founded in 1988, AberdeenGroup is the trusted advisor to the Global 5000 for value chain strategies and technology advice. Through its continued benchmarking and analysis of value chain practices, Aberdeen offers a unique mix of research, tools, and services to help G5000 executives assess their value chain performance, develop improvement strategies, and select value chain partners.
For more information, visit www.aberdeen.com or call 617-723-7890.

About UGS
UGS is a leading global provider of product lifecycle management (PLM) software and services with nearly 4 million licensed seats and 46,000 customers worldwide. Headquartered in Plano, Texas, UGS’ vision is to enable a world where organizations and their partners collaborate through global innovation networks to deliver world-class products and services while leveraging UGS’ open enterprise solutions, fulfilling the mission of enabling them to transform their process of innovation.

Note: UGS, Teamcenter and Transforming the process of innovation are trademarks or registered trademarks of UGS Corp. or its subsidiaries in the United States and in other countries. All other trademarks, registered trademarks or service marks belong to their respective holders.

The statements in this news release that are not historical statements, including statements regarding expected benefits of the product, adoption by customers, continued innovation and other statements identified by forward looking terms such as “may,” “will,” “expect,” “plan,” “anticipate” or “project,” are forward-looking statements. These statements are subject to numerous risks and uncertainties which could cause actual results to differ materially from such statements, including, among others, risks relating to developments in the PLM industry, competition, failure to innovate and intellectual property. UGS has included a discussion of these and other pertinent risk factors in its annual report on Form 10-K most recently filed with the SEC. UGS disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Contact Information

Jim Phelan

UGS Corp.

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