Dive Brief:
- Autodesk has made plans to eliminate 13% of its workforce — 1,150 positions total — according to Fortune.
- The move comes on the heels of a strong Q3 earnings report, which brought Autodesk's third-quarter revenue to $515 million.
- In a release, officials note that the restructuring represents the company's shift toward employing a subscription-based model.
Dive Insight:
Autodesk's announcement follows shortly after the software-maker "behemoth" rolled out its new BIM 360 platform, in addition to a spate of new partnerships, at its annual flagship event, Autodesk University. While the move may have come unexpectedly, Autodesk's transition to a subscription-based model mirrors a growing economic trend.
According to ITProPortal, subscription models are already common — and companies that have them would do well to grow their subscriber base and automate their renewal management systems. Firms that manage subscriptions continuously and anticipate the renewal process ahead of that period will draw higher renewal and customer satisfaction rates, the report notes, ultimately driving business growth. That model has already worked well for software providers Cisco and PlanGrid, both of which have ties to former Autodesk CEO, Carol Bartz.
Scott Herren, Autodesk's chief financial officer, told Forbes that the company's new business model will help them prepare for the next big trend in business operations — moving toward the cloud. While developers increasingly seek digital solutions for job site challenges, con-tech software companies are stepping up to fill that role.
The cloud, especially, has helped transform the ways in which many business operate. A 2016 survey from the Associated General Contractors of America and Sage found that 59% of construction firms surveyed had plans to use or already used cloud-based software. Similarly, the rise of new on-site hardware, from smartphones to tablets, has driven growth in third-party app development and broader adoption of the cloud.
As construction sites become more high-tech and the people managing them become increasingly connected, more industry professionals will likely shift toward implementing a cloud-based strategy for data storage and sharing. That capability will allow project teams to streamline operations, giving each user the up-to-date data they need in real time — a process that, ultimately, will help compress any lag in information sharing and decrease the potential for error.
