ERP

IFS: Empowering the World’s Challengers

Challenging the Status Quo, In Pursuit of the Extraordinary

IFS is in hot pursuit of the “challenger.” Being a challenger isn’t about market position or size, but more of a mindset. It’s about challenging the status quo, in pursuit of the extraordinary. Challengers have an appetite for something new. They aim to stand out, to transform their businesses. And while IFS is committed to empowering the world’s challengers in five select industries, it is also intent on being a challenger itself in the world of enterprise applications.

In the eighteen months since Darren Roos took the helm as Chief Executive Officer (CEO), he has sharpened the focus and brought consistency, collaboration and authenticity to its global operations, without damaging a corporate culture built on trust. Already a strong solution provider, IFS has developed products with deep industry functionality by listening to and working closely with its customers. That depth is now complemented with embedded, enabling technology that brings agility, usability, extensibility and more innovation. Under Darren’s leadership IFS challenges the status quo by being a software solution provider that prides itself on “Saying what we [will] do, and doing what we say.”

Here we take a look at what IFS has done to enable it to empower the world’s challengers.

Sharp Industry and Solution Focus

IFS has always focused on asset-intensive and product-centric businesses, but it has sharpened that focus to five industries:

  • Aerospace & Defense
  • Energy, Utilities & Resources
  • Engineering, Construction and Infrastructure
  • Manufacturing
  • Installation, Repair and Maintenance Service

While sometimes prospects might pull it into some related, under-served markets that share some common characteristics (like mining and oil & gas), these five are the segments it will use to provide direction to its product roadmaps and its go-to-market strategy. Unlike some of its competitors, interested only in grabbing market share, IFS is sticking to the industries it knows best, and for which its solutions have been designed and tuned. Rather than offering a general-purpose, one size fits all solution, it develops one that is purpose-built.

And while some of those same competitors are also trying to be one-stop shops for all enterprise applications, IFS focuses on three specific solutions that are individually deployable, yet inherently integrated. They are:

  • Enterprise Resource Planning (ERP)
  • Enterprise Asset Management (EAM)
  • Field Service Management (FSM)

However, when combined, these three cover a very broad footprint. Indeed, many ERP solution providers today claim to provide a complete “end-to-end” solution, to the extent that it is often hard to tell where ERP ends and other applications begin. But is this really what companies want today or is it just another land grab?

We asked our 2019 Enterprise Solution Study participants to choose between a “Suite in a Box” – a complete end-to-end solution that is pre-integrated and ready right “out of the box,” or a more “Best of Breed” approach with a strong core, coupled with the ability to purchase or develop additional functionality and easily connect it back to the core. We recognize the choice is not always so cut and dried, and therefore added some options that are more of a mix but leaning in one direction or the other. Where one approach was clearly preferred (i.e. not a mix), we found the “Best of Breed” approach preferred 2:1 over a “Suite in a Box” (Figure 1).

Figure 1: Which approach is most appealing to you?

Source: Mint Jutras 2019 Enterprise Solution Study

This may seem like the integrated suite versus “Best of Breed” arguments that have waged throughout the world of enterprise applications for decades. That debate was always about the tradeoff between sacrificing “best of breed’ functionality for ease of integration. But there are some subtle and not so subtle differences. Nobody today is willing to sacrifice features and functions. And everyone wants an integrated solution. But they also want it “their way” and at their own pace. And they don’t necessarily like to be locked in with a single solution or vendor.

ERP itself is an integrated suite. Mint Jutras defines ERP as an integrated suite of modules that provides the operational and transactional system of record of your business. As such, it is comprised of modules, some of which are core to any business (e.g. general ledger, accounts payable, accounts receivable, purchasing, order management, etc.) and some specific to a type of business. Product-centric businesses, particularly manufacturers, also need logistics and production capabilities. But ERP doesn’t necessarily address the needs of sales, service or marketing. And seldom does it address all the special needs for asset maintenance and management or field service.

For these asset-intensive industries, IFS has chosen to address the special needs of field service (FSM) and enterprise asset management (EAM), but don’t expect it to acquire or develop a CRM system any time soon.  It will leave sales and marketing to the likes of Salesforce and Marketo, and payroll to the likes of ADP, Paychx and CloudPay. And it is not afraid to use technology from partners like Microsoft to address industry-specific needs like ITAR (International Traffic in Arms Regulations) compliance in the United States. 

Of course, a lot of development effort internally goes into developing and innovating these solutions. But IFS has also invested in acquisitions, including the acquisition of Workwave in 2017, and the most recent announcement of a definitive agreement to acquire Astea Technologies, a well-recognized player in the FSM arena. According to the announcement, “The combined company will have strengthened leadership position in Field Service Management (FSM) by integrating two of the most established and well recognized players in the market.”

It is clear, IFS will stick with what it knows best, leveraging its deep domain expertise, but also provide strong integration capabilities. This is not only possible today, but is also the key attraction to the most popular option in Figure 1 – the ability to assemble exactly what is needed, with the caveat that it must be easily connected back to the core… which brings us to the product(s).

Delivering on its Promises

IFS prides itself on the philosophy of transparency: We say what we do and do what we say. But the cadence and volume of innovation is also important. IFS has a spring and fall release each year. But it is also establishing an ‘evergreen’ approach, which gives customers the option to always be on the latest version of their applications without the disruptions that come with full-scale upgrades. The applications are continuously updated, and new features are optional.

This re-imagined application life-cycle experience does not require the customer to be running in the cloud. Unlike other vendors that seem more intent on being the biggest (in the cloud) than on delivering what customers really want, IFS offers the choice between cloud and on-premise, with the same software available regardless of which deployment option is chosen. While there are some obvious advantages to the cloud, including this ‘evergreen’ approach, IFS offers no incentives to move to the cloud, leaving the choice entirely up to the customer.

Architecture is Key

The secret behind IFS’ ability to keep a steady cadence of both features and technology improvements is the attention it has paid to laying the proper foundation. Oftentimes today, in selecting a new ERP (or FSM or EAM), there is a tradeoff between a solution that has matured over years or even decades, and one that has been developed more recently, based on the latest and greatest technology. IFS is one of the very few solution providers today that has survived the evolution from mainframes to component-based, cloud native architectures, without abandoning its original solutions or leaving them behind to ride out their final years on old and outdated technology.

“IFS has been evolving its technology foundations over an intensive and sustained period of engineering development.”

This statement was included in its recent announcement of what it calls its “evolved industry-focused architecture.” Scheduled for availability in 2020, this new architecture will lay the foundation for IFS’s entire portfolio of products.

“In essence, this new approach will allow customers to integrate enabling technologies such as internet of things (IoT), augmented and mixed reality (AR/MR), artificial intelligence (AI) and machine learning (ML) in pragmatic and focused ways so they can optimize, automate, predict and interact better across their business.”

But IFS customers don’t have to wait until next year to reap some benefits. The current underlying architecture is already component-based and this is, in fact, how IFS has been successful in delivering last mile functionality, not only to its declared focus industries, but also to individual verticals within those segments. Process manufacturing industries, like food and beverage, provide the perfect example. Keeping up with different regulatory requirements across the globe has always been a challenge, but one IFS has readily accepted. But it has not burdened other industries with the specific requirements needed for compliance. Instead, it has developed a series of components that can be assembled and integrated seamlessly into the core ERP product.

How does this work and how does it set IFS apart from rivals that have similar maturity of feature/function, but perhaps not the technology enablement to meet rising expectations today?

In the past legacy solutions were developed as monolithic structures. Adding very narrowly focused features and functions added to the complexity of the solution and also made it rigid, hard to maintain and innovate. IFS was among the early pioneers in moving away from this monolithic approach. Its journey to a component-based architecture began in 1994 when it introduced its Services Oriented Architecture (SOA). Today it is moving steadily towards a microservices architecture, with specific mention of container technology and Kubernetes, but that is a more technical discussion than most business leaders care to dive into.

Every technologist in our audience knows a microservices architecture is defined as an architectural style that structures an application as a collection of loosely coupled services. For those nontechnical readers, think of it as constructing a solution from a set of Lego building blocks. Purists hate this analogy, and yes, it is an over-simplification. But it is an effective analogy that resonates with most business users that don’t have the interest or inclination to dive deep into technical jargon.

Think about how you build a structure from Legos. Each Lego block is made of the same kind of material and is attached (connected) to the other Lego blocks the same way. In many ways they are interchangeable. But by choosing different colors and sizes, and connecting them with a different design, you can make a structure that is very unique. And once constructed, if you want to change it, decoupling some of the blocks and replacing them doesn’t destroy the parts that are not affected. There is far less disruption introduced than if you had constructed it with a hammer, timber and nails.

IFS has already evolved from the era of the mainframe, through the client/server era where the graphical user interface (GUI) dominated, followed by web-enablement and the cloud era. IFS has declared the next era to be the era of intelligent and autonomous enterprise solutions. In a world where self-driving cars are a reality, why shouldn’t enterprise applications be smart enough to automate processes and help you make intelligent, data-driven decisions? So how is this transition coming along?

Tracking IFS Progress

When the latest IFS Applications 10 was announced last year at its 2018 World Conference, it included new features and functions, but also introduced some key areas that show IFS moving in this general direction. Let’s take a look back on each and get an update.

A New User Experience (UX)

IFS Applications 10 introduced a brand new, intuitive user experience, called IFS Aurena. The new UX was well received when initially launched. It has now been extended across all IFS solutions (FSM, ERP, and EAM), and  (impressively) it was delivered ahead of schedule. Aurena provides customers with a truly responsive design. This means it responds to the environment on which it is used, based on screen size, platform and orientation. Whether you use it on iOS, Android or Windows, the applications take advantage of the native capabilities of the device, giving them a familiar look and feel, with support for offline scenarios and device-specific capabilities such as GPS and camera. In addition, IFS Aurena BOT is now generally available. This is essentially a virtual assistant that allows the user to interact with the system via voice or text. It can connect to any of the popular messenger apps (Skype, Skype for Business, Facebook Messenger, etc.) and is making use of artificial intelligence (AI) to make it an intelligent bot.

Application Programming Interfaces (APIs)

Last year IFS started adding APIs to open its applications to new paths to extensibility and integration. Whether you prefer a Suite in a Box or a Best of Breed approach, nobody runs a single application today. And no application can afford to be an island. IFS has now developed over 15,000 APIs, which means connecting, extending or integrating into the IFS core is quick and easy. As a new member of the OpenAPI Initiative (OAI), IFS promotes open applications in order to give customers and partners total freedom to develop and connect data sources to drive value in a way that is meaningful to them. IFS Aurena uses the same set of APIs which are now generally available for every function in every IFS application.

Connecting Smart Devices

IFS is constantly evaluating the potential new digital technologies have in providing real value to its customers. Projects are led by a small development group called IFS Labs. IFS Labs is focused on solving the problems of tomorrow – or perhaps the problems and opportunities customers don’t (yet) realize they already have. With this approach, IFS Labs hopes to provide guidance and inspiration to influence customers to disrupt, rather than be disrupted.

But this is not technology for technology sake. These endeavors are essentially “proof of concept” projects, often conducted with real, live customers in order to solve real problems. IFS Labs keeps the projects small because, with the requisite license to fail, it must decide to pursue the concept and apply it universally or fail fast in order to move on to the next potentially disruptive project.

Much of this pioneering, experimental work is done quietly in the Lab and yet the results of several of these projects were demonstrated at the most recent IFS World Conference.

On stage and on the Exhibition floor at the 2019 World Conference, attendees watched as Marvin, a small, self-driving, robotic forklift delivered materials to the shop floor. Marvin is very real and working at Cheer Pack, a US manufacturer of spouted pouches used in the packaging of baby food, children’s snacks, yogurts, pet foods, dressings, condiments and other food & non-food items… and an IFS customer.

While humans are still loading and unloading the materials, CheerPack intends to connect it directly to material handling equipment in the future to further automate the process.  In the meantime, no human is involved in guiding the little robot to its pickup and drop off locations. ERP drives what it carries and where it goes.

The audience also watched as remote technicians guided the diagnosis and repair of Marvin. Think of it as Facetime for the enterprise. An operator on stage was able to share a live view of Marvin with a remote technician, who was able to guide her through the diagnosis and resolution of the problem. Think of the possibilities this might present to asset-intensive companies running a 24/7 operation, but with technicians only on site one shift. Or those operating in remote parts of the world where it makes no economic sense to have technicians remain on site constantly when they are seldom needed.

Attendees of the conference could also don a HoloLens and be guided through the replacement of an integrated circuit board. While this type of augmented reality has been available for a while, in the past it was hard to operate and required far too much skill and use of the wearer’s hands, when in fact the biggest benefit should be for hands-free operation.  This technology has now reached the level of maturity where a novice (like the author) can pick up the device and use it with little or no instruction.

While some might call them “next gen” capabilities, these are among those IFS has deemed to be “now gen,” ready for prime time. But these efforts continue.

Look for the introduction of a new Machine Learning (ML) Service coming in 2020. While asset-intensive industries are ripe with possibilities for accelerating the use of Artificial Intelligence (AI) in practical ways and connecting applications to devices and the Internet of Things (IoT), there are also challenges. It is very difficult to prepare the right data, often requiring a data scientist and competency in machine learning technologies. There is always the risk of a communication breakdown between those data scientists and technologists and business leaders with business goals.

The new ML Service is being designed to be easy to use, enabling business users to solve specific business problems with the automated selection of ML algorithms, based on their own data. These new services will be “explainable.” In order to build trust in the data and the algorithms, ML can’t be a black box. The user should be able to understand why an algorithm is being used. IFS agrees.

Expanding and Strengthening the Ecosystem

In conjunction with opening up its architecture with APISs and modern component architectures, IFS is also investing in its partners. Its mission is to triple the resources, but also create one IFS team, while providing its customers more choice. Many customers prefer to work directly with a more local partner, but since IFS requires all to be 100% certified on the applications, customers should see no difference in quality in working with IFS or a partner.

While in the past partners were very likely to build customizations for customers, we see a huge potential for them to transition to building extensions. As IFS opens up its platform to partners, this presents an opportunity for them to package up potential modifications, providing themselves further revenue sources while also extending the IFS applications deeper into the vertical and even micro-vertical segments within the sectors in which IFS plays well. This removes barriers to consuming IFS innovation that customizations create, while also creating opportunity for IFS, its partners, and its customers.

Summary and Key Takeaways

IFS customers don’t necessarily hold the top spots in their chosen fields. As a result, the old advertising slogan, “We’re number two. We try harder” might very well apply.

To IFS “For the challengers” means:

  • Helping customers differentiate
  • Focusing on industries and solution sets
  • Providing agility and better time to value
  • Value and results for the customer
  • Choice – how licenses are consumed, and software is deployed and who delivers (partners, IFS, both)

IFS clearly believes in the world’s challengers, encouraging and enabling then to gain a competitive advantage and create value through innovation. In support of these beliefs, it is focused on providing its customers value by delivering on three key enablement points:

  • The software used to run the business in select asset-intensive, product-centric industries, namely ERP, EAM and FSM
  • Enabling technology that helps its customers keep pace with our rapidly changing world
  • Data needed to drive effective decision-making

And at the same time, IFS sees itself as one of those challengers. It’s not the biggest enterprise solution provider, but still it strives to disrupt, rather than be disrupted. In reaching for this objective, it has sharpened its focus on five industries, with three solution categories. With functionality that is broad, deep and industry-specific, it also continues to take advantage of new and enabling technologies. It chooses to embed these technologies rather than use them to milk the cash cow of their installed base.

Whether you are a challenger in one of IFS’ chosen industries, or whether you aspire to be, you might want to take a closer look at IFS.

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Acumatica Customers, Prospects and Partners: See You in Vegas?

Top 7 Reasons to Attend Acumatica Summit 2020

Acumatica Summit 2020 will be at the Cosmopolitan in Las Vegas, NV January 27 – 28, 2020. Those who are proud to be called “techies” can come a day early for a Hackathon, and any and all can stay longer to attend two more days of training.  As an industry analyst I have attended more conferences than I can count. Many are over-hyped and just plain boring. But I have to admit, this is one I actually look forward to each year. Here’s why.

Timing

First of all, the timing is right. Most of these events are held in the spring or fall, which means I am (usually) on the road eight or nine out of nine or ten weeks at a time, sometimes attending one or two events a week – once in a while hitting three in a single week. No wonder most just tend to blur together. And it’s not just me. Attendees are juggling their kids’ school and sports activities, and maybe even school vacations. But by the end of January, I will have mostly been off the circuit for a couple of months. For other attendees… while nobody is taking a long winter nap, schedules aren’t quite so packed. And if you live up north, like I do, you might just be ready to go someplace warm for a few days.

And… there’s no football to watch that weekend. The AFC and NFC Championships will have played out and two lucky teams and their fans will be preparing for the Super Bowl the following weekend.

Access to Acumatica Top Brass

For a company that sells exclusively through partners, the top-level executives at Acumatica are amazingly accessible. That includes CEO Jon Roskill, Founder and CTO Mike Chtchelkonogov (Mike C for short), and Chief Product Officer Ali Jani. It is not uncommon for Mike C and Ali to visit customers and they love to engage directly with users. They are very approachable at the Summit.

Network with an Engaged Community

The Acumatica community is very engaged. That not only includes the Acumatica staff and its partners, but the end users as well. So, if you are looking to network, discuss ideas, offer constructive criticism or praise, the Summit is the place to do it. There’s nothing like the kind of personal interaction you get from meeting others with common interests and most attendees are more than happy to share their experience.

Product Tips and News

Of course, if you just want to keep to yourself and attend sessions, the Summit is a great place to learn more about the current product, the latest innovation and plans for the future. Plus, you can get tips on implementation and getting the most out of yours.

Cool Keynotes

In addition to hearing the latest from Acumatica execs, Acumatica always has a very interesting guest speaker. Not the fluffy kind of celebrities that pretend they know a lot about running a business, (most should stick to show business) but presenters with some substance. This year you’ll hear Robert Ballard, renowned ocean explorer, scientist, and discoverer of the Titanic.

Sessions for Everyone

All sorts of different people attend the Summit. There are sessions for all attendees, including some that are geared towards specific editions (manufacturing, construction, field service, eCommerce…). But there are also sessions for the developers in the crowd, including Acumatica xRP Framework Fundamentals and Web Services (and more). And there are sessions dedicated to partners on topics ranging from pricing to sales strategies, to best practices for co-selling with ISVs.

I’m Usually on a Panel

Typically, I am on a panel with other Industry Analysts talking about trends in ERP. Sometimes we’re joined by customers. While I won’t pretend this is the best reason for you to attend, I promise to make it entertaining!

And so…

These are the reasons I am looking forward to Acumatica Summit 2020. And if you are an Acumatica customer, or thinking about becoming one, or if you are an Acumatica partner, you just might want to attend as well. I’ll see you there!

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Sage Intacct Plots a Path to Intelligent GL

A Worthy Stop on a Longer Journey

Sage Intacct has been on this journey towards an Intelligent General Ledger (GL) for several years. The company’s  goal has been to relieve finance leaders of the burden of routine accounting tasks, while also bringing them visibility to data, along with the necessary tools to provide actionable insights that will lead to growth and profits. Many finance leaders today are spending 80% of their time on accounting, leaving only 20% available to think and act on a more strategic level. An “Intelligent GL” is really all about flipping that ratio. Of course, no piece of software can magically turn a bean counter into a strategist. But it can help you build trust in your data and decisions, and provide you the time and the tools you need to dig deeper, analyze, predict and prescribe a course of action.

And therefore, although an Intelligent GL is a lofty goal, the real value will come from diffusing this intelligence beyond the GL, beyond finance, leveraging it across all aspects of the enterprise. But then, isn’t that what strategic thinking (and doing) is all about? While Sage Intacct doesn’t profess (or pretend) to provide an end-to-end solution, a strong, “best of breed” financial management solution can indeed serve as a solid foundation on which to build a strategy that leads to profitable growth.

Click here for a closer look at Sage Intacct’s path to providing an Intelligent GL and what it can mean to your business.

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Rootstock Delivers on the Value Proposition of the Salesforce Manufacturing Cloud

                                                                                   

Providing the Much Sought After 360o View

How do you achieve a 360o view of your customer? While this has been a popular catch phrase for solution providers offering Customer Relationship Management (CRM) systems for years now, there have always been missing pieces to this panorama. A good CRM, as the acronym implies, can indeed help you manage the relationship with your customers, often starting at a point when the customer is still a prospect. CRM solutions do a good job of managing a pipeline from initial contact to quote, and perhaps even to the point where the quote is turned into an order. If this is all it does, it might be more appropriately classified as Sales Force Automation (SFA). But of course, some CRM solutions extend beyond this. But no CRM, on its own, really manages an order, creates an invoice or manages accounts receivable and collects cash – all necessary for that 360o view. That is the domain of Enterprise Resource Planning (ERP).

Salesforce CRM is indeed one of the most mature CRM solutions on the market today. While lighter versions exist for even the tiniest companies, those that tap into its full and extended functionality are able to effectively digitize marketing, manage diverse channels, connect sales and service and derive business insights and intelligence about all things customer-related. This may be sufficient for some types of businesses, but manufacturers face some additional challenges. If sales and operations are not properly aligned, if revenue forecasts can’t accurately predict demand at a detailed product level, then manufacturing can’t deliver completely and on time without inflating inventory. And even with padding inventory, can it deliver the kind of customized or personalized product many markets demand today?

In order to address these specific challenges of manufacturing, Salesforce recently introduced its Salesforce Manufacturing Cloud to “deliver transparency and predictability across your ecosystem… Align sales and operations, unify account planning and forecasts, and deliver greater transparency with a tailor-made CRM for manufacturers.” But in order to make good on this promise, Salesforce itself must tap into its own ecosytem. Enter Rootstock, providing Cloud ERP for Manufacturing, Distribution and Supply Chain organizations. As such, Rootstock plays a key role in helping Salesforce deliver on its declared value proposition of delivering the much sought after, but often elusive, 360o view of the manufacturer’s customer.

Click here to read the full report

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Plex Systems: Connect to Transform

Accelerating Out of the Curve of its Own Transformation

Over the last few decades Enterprise Resource Planning (ERP) solutions for manufacturing have evolved from their roots in Material Requirements Planning (MRP), and have become quite mature. Throughout that time we’ve seen solutions and solution providers proliferate and then consolidate, leaving a select few that develop and support a single ERP solution dedicated to filling the needs of manufacturers. Plex Systems is one of those few, but even within this select group, Plex is unique. Not only does its Plex Manufacturing Cloud (PMC) satisfy the back-office needs of manufacturers, it also dives deep into the shop floor, with strength in quality management and manufacturing execution. Born in the cloud, Plex’s ERP has been offered exclusively as Software as a Service (SaaS) since 2001, making the company a true cloud pioneer.

For years following 2001 Plex Systems was in the high-speed lane on the straight-away, rapidly expanding its depth and breadth of functionality. PMC became the performance engine driving growth and profits for a steadily growing customer base. But just as manufacturers today must undergo a transformation in order to compete effectively in the global, digital economy, so must Plex. And in the course of that transformation it must navigate some curves. It must evolve its platform and architecture, embrace new digital technologies, support disruptive business models and adapt to changing expectations of today’s workforce.

Whether driving a muscle car or a business, you know you need to ease up a bit on the accelerator as you enter a curve in the road. But if you have a performance engine under the hood, there is nothing more exhilerating than accelerating out of that curve. Where is Plex Systems today? Is it about to explode out of the final turn?

The Straight-Away: A Bit of History

In its early years Plex offered the only ERP for manufacturing that was available exclusively as Software as a Service (SaaS). In order to fully appreciate why Plex was indeed in the fast lane, on the straight-away, you have to understand why Plex became a “SaaS only” company in 2001. It wasn’t because SaaS and cloud were the hottest topics back then. Back in 2001 “SaaS” and “cloud” were not even part of the vocabulary of the typical manufacturer. It wasn’t because the company wanted to be on the bleeding edge of new deployment options. Most manufacturers weren’t even knowingly and willingly considering SaaS.

The real reason was because the founders had developed technology and processes to rapidly develop applications and SaaS was the only way they could deliver software as fast as they could develop it. They wanted to share new functionality and new technology as it was developed, not 12 to 18 months later, when the next release was scheduled. As a result, early on, customers didn’t buy the Plex Manufacturing Cloud because it was SaaS. They bought it because of the broad and deep functionality and the company’s willingness and ability to respond to their needs… in spite of the fact that it was deployed and delivered through the cloud.

And yet back in the early 2000’s Plex was not only a fledgling company, but also a self-funded SaaS solution provider. Of course, back in 2001, ERP systems in general, especially those offered by small start-ups like Plex, were not as full-featured as today and this naturally led to gaps. However, when you have a development team excited about new rapid application development tools and anxious to please customers, those gaps get filled quickly. During this “straight-away” phase, Mint Jutras once observed that in the time it took a traditional development organization to tell its customers/business users why something couldn’t be done, the Plex development team would have had a proto-type of the solution up and running.

Unlike most providers of multi-tenant SaaS solutions, Plex willingly “customized” the software. But the enhanced software wasn’t custom for long (if at all). Plex always incorporated these enhancements into the product. As a multi-tenant SaaS solution, every single customer runs the exact same software. It just might not look or behave identically from customer to customer because most of these enhancements could be selectively turned on… or not.

Throughout this time, the lion’s share of innovation came from customer-driven enhancements. In the early days, customer-driven also meant customer funded. So, a customer would pay Plex Systems to enhance the product and other customers would benefit. In other user communities this does not happen, at least not consistently. The typical way of thinking is, “I paid for it and it’s mine and only mine.” In the land of Plex, customers simply viewed this as making a contribution to the community. And they expected others to do the same. Each gave a little, and everyone got a lot. When everyone is running the same software, literally, not figuratively, it creates a unique sense of community, one of being “all in” together.

The Turning Point

This strategy worked brilliantly for years, but then Plex reached a point in its own maturing process where it no longer made as much sense. The gaps in functionality had been filled and Plex needed to formulate its own strategy for growth, rather than let itself be led entirely by its customers. Adding functionality that was not mainstream, or features that perhaps led down a path Plex deemed not to be strategic, would only add unwanted complexity to the solution. So, several years ago Plex took charge of the roadmap and began to phase out customer-funded development and increased its R&D investment.

But there were other factors at play here as well. This decision came at a time when disruption had become the norm. We live in disruptive times. Last year, the 2018 Mint Jutras Enterprise Solution Study found 89% of companies believe they face some level of risk in their businesses and/or industries being disrupted by new innovative products, new ways of selling or pricing existing products or services, entirely new business models, or some combination of all of the above. And then of course there are still the more traditional disruptive factors like expansion and growth, organizational restructuring and regulatory changes, just to name a few.

All this disruption can have a cascading impact on business application requirements, making agility – the ability to easily innovate, evolve and change – even more important than current functionality. Software delivered as a service is only one of the ways innovation is delivered and consumed faster and more easily. This speed is largely dependent on the way your ERP solution is constructed and the platform on which it sits. This caused Plex to focus some attention on the underlying architecture and what Mint Jutras calls “foundational” technologies.

Table 1 shows how our survey participants perceive the value of foundational technologies that are embedded in enterprise applications.

Table 1: Perceived Value of Embedded (or Foundational) Technologies

Source: Mint Jutras 2019 Enterprise Solution Study

While a growing percentage of manufacturers perceive these technologies as providing strong value, on average almost one in three (32%) are unsure of the value. Essentially, they are saying, “Show me.” And another 9% (the average across all) simply don’t know. And yet investment in these kinds of technologies is essential to the continued health and well-being of any solution used to run a business today. As Plex turned its attention to these underlying technologies, it very likely appeared as if innovation was slowing down. In fact, investment increased; Plex was (and is) just navigating a curve. To understand what Plex is doing, and why, we need to step back and look at what is going on in the world around us all in terms of how solutions today are built and delivered.

“Suite in a Box” or Best of Breed? Yes

First, we need to re-examine a debate that has been waged throughout the world of enterprise applications for decades: choosing an integrated suite or “Best of Breed” approach. Many ERP vendors have been preaching the benefits of a complete, end-to-end solution and arguing against the proliferation of disparate applications for almost as many decades.

This is exactly what Plex has been delivering and it would certainly appear to be what Plex customers want. Plex customers have participated actively in Mint Jutras surveys for many years now. They tend to have more complete solutions than manufacturers running other solutions, and strongly favor a single vendor, single solution.

We asked the survey participants in our 2019 Enterprise Solution Study to choose between a “Suite in a Box” – a complete end-to-end solution that is pre-integrated and ready right “out of the box,” or a more “Best of Breed” approach with a strong core, coupled with the ability to purchase or develop additional functionality and easily (we use the term loosely) connect it back to the core. We recognize the choice is not always so cut and dried, and therefore added some options that are more of a mix but leaning in one direction or the other. The results (Figure 1) surprised us a little. We expected a higher percentage would prefer the Suite in a Box approach.

Figure 1: Which approach is most appealing to you?

Source: Mint Jutras 2019 Enterprise Solution Study

Since collecting this data, Mint Jutras actively sought out discussions with companies, posing the same question, and got very similar results. But then we asked, “Why?” The short answer: most are interested in a fully integrated, fully functional solution, but they want the freedom and flexibility to implement incrementally, in their own determined sequence. In other words, they want both.

Many are also in the midst of a transition to cloud solutions. This may mean a complete shift, starting with the migration or replacement of an on-premise ERP solution. Or it may mean a more gradual shift, often leaving in place on-premise ERP solutions and surrounding them with cloud-based added apps.

The core points of any debate between suite and Best of Breed center around the trade-offs between ease of integration and depth and breadth of solution. With a suite approach, all modules share a common database and are developed using the same tools and technology. This eliminates data redundancy and any need for separate integration efforts.

In the past specialty functionality built into ERP was lighter and less feature-rich and definitely not “best of breed.” While that may have been the case early on, over the years, ERP solution providers added more robust features and functions through a combination of their own development efforts and sometimes through acquisition. Today they are often (not always) able to compete head to head against stand-alone “best of breed” applications.

With the exception of two acquisitions (DemandCaster for supply chain planning and DATTUS for Industrial Internet of Things connectivity) Plex’s functionality has been internally developed and therefore intrinsically built into the suite. This includes rich functionality connecting the shop floor to the top floor. The Plex Manufacturing Cloud can certainly hold its own against so-called best of breed applications in several categories, including quality management (QMS) and manufacturing execution (MES).

So, if companies can get best of breed functionality in a suite, without the need to manage separate integrations, what drives the desire for the “Best of Breed” approach as we articulated it in our question?

We find many articulate their desire as a “Best of Breed” approach because they equate the suite to a monolithic architecture and an “all or nothing” kind of decision. In some ways that is true, but not entirely so. Most any ERP solution is comprised of modules (e.g. general ledger, accounts payable, inventory management, purchasing, order management, shop floor control, etc.) and certainly some are optional. There is always a preferred logical sequence to implementation because of dependencies in the data. Foundational data like charts of accounts, customers and part or product masters must be established early. But once the foundation is built each company is free to decide what comes next and how far to go. This is certainly the case with Plex customers. Most go live when they have the basics established, but then have further steps planned.

But with a monolithic architecture few, if any of the modules are designed to stand alone. Sure, you can just implement general ledger, or inventory management perhaps, but you can’t just implement the manufacturing execution system (MES) that is built into ERP. Or the Quality Management System (QMS). Which is one of the primary reasons why Plex Systems is actively engaged in decomposing its monolithic solution and reconstructing it as loosely coupled components. This is at least one of the curves Plex is navigating.

What, if any, significance does this have on existing Plex customers and prospects? For those customers looking for a complete end-to-end solution, it allows Plex to once again speed the delivery of added features and aids them in providing last mile functionality without adding complexity. Instead of building customer-driven enhancements into the base, it can assemble a unique set of components to deliver industry-specific functionality for each of the segments of manufacturing on which Plex focuses.

For prospects looking to start their own cloud journey or digital transformation, it provides an option to start small, perhaps with MES instead of a full ERP solution. And of course, that provides Plex with added growth opportunity.

But “decomposing the solution” is not the only way Plex is navigating this curve and transforming the company and its solution. It is actually hitting on all of the different aspects listed back in table one. The most obvious is the transition to cloud and SaaS. While not exactly a “technology,” it is the only entry in the table that is even close to mainstream. But this requires no transition for Plex. PMC was born in the cloud and has always been offered as a multi-tenant SaaS solution. Enough said.

However, let’s hit on a few of the others listed.

Platforms and Architecture

Development platforms and microservices architectures are key to this decomposition. For the reader with a technical background, a microservices architecture is defined as an architectural style that structures an application as a collection of loosely coupled services. This is the process of decomposition to which Plex refers in its roadmap. For those nontechnical readers, think of it as constructing a solution from a set of Lego building blocks. Purists hate this analogy, and yes, it is an over-simplification. But it is an effective analogy that resonates with most business users that don’t have the interest or inclination to dive deep in technical jargon.

Think about how you build a structure from Legos. Each Lego block is made of the same kind of material and is attached (connected) to the other Lego blocks the same way. In many ways they are interchangeable. But by choosing different colors and sizes, and connecting them with a different design, you can make a structure that is very unique. And once constructed, if you want to change it, decoupling some of the blocks and replacing them doesn’t destroy the parts that are not affected. There is far less disruption introduced than if you had constructed it with a hammer, timber and nails.

Plex is actively engaged in developing this type of platform and is probably about a year away from completion. But in the meantime, it is delivering value through other associated technologies, starting with the Industrial Internet of Things (IIoT).

Industrial Internet of Things (IoT)

While sensors, machines and equipment on the shop floor have been collecting vast volumes of operational data for decades now, that data has not always been “connected” or accessible for decision making. Indeed the very fact that this data collection has been happening for decades contributes to the problem. Many of the machines and software put in place decades ago pre-date the Internet and therefore have no ability to connect to a network. Retrofitting equipment, or replacing it, is expensive and most of these machines were designed to last a lifetime. Expensive custom integration projects are beyond the expertise and budgets of all but the largest manufacturers. So what’s the alternative?

This is where Plex’s acquisition of DATTUS comes in. Providing an alternative is what DATTUS is all about. Think of it as the bridge between you and your machines. The platform is a hardware/software combination, which collects data from PLCs, VFDs, industry protocols like MTConnect, and popular enterprise applications including Salesforce, SAP and (of course) Plex. The goal: making this data available for analysis and decision-making.

The majority of the original DATTUS customers are not sophisticated and therefore beyond the physical connection Plex is concentrating on developing applications to be used right out of the box, rather than just providing a tool set and leaving it up to customers to connect manufacturing equipment and sensors to the cloud and to PMC. DATTUS is now Plex Industrial IoT and the first applications are centered around visualization of the sensor data, combining it with data from PMC, adding thresholds for alerting production supervisors when a process is about to go out of spec. But the team is already working on connecting data to MES and QMS to complete the genealogy and traceability and for anomaly detection to prevent machine failure. But this anomaly detection will require some artificial intelligence.

Artificial Intelligence

Technologies like machine learning, natural language processing and other forms of artificial intelligence have become quite prevalent in consumer technology (think Siri and Alexa, or GPS that learns your favorite route). Now is the time to bring them into the enterprise, much like they were insinuated into our personal lives – by adding value and embedding them.

The concept of machine learning in an industrial setting employs computer algorithms that learn and improve over time with use, often drawing on data, not only from enterprise applications, but also from equipment on the shop floor or even from smart products in the field. Between the data already being collected in PMC and the data that can be potentially collected through Plex IIoT, Plex is sitting on a potential gold mine of data to use in machine learning. The team is laying the ground work for future initiatives.

In the meantime, the development team is already experimenting within PMC by analyzing settings to discover combinations that produce great (implementation) results and those that can spell disaster, in order to guide new customers and even warn them of pending disaster. Delivering this kind of artificial intelligence provides value, not only to those looking to connect to the IIoT, but to all Plex customers. And therefore, Plex is following the same path Apple took in delivering a voice-activated virtual assistant (Siri). Nobody asked Apple to deliver this and Apple didn’t make it a separate option (with a separate price tag). Once customers started using it, they saw the value and it became a prerequisite for any smart phone. Will Plex set the standard in terms of performance evaluation of a SaaS solution for manufacturing?

Accelerating Out of the Curve

Like any good business competing effectively in the today’s global, digital economy, Plex Systems has been undergoing a transformation. Unlike other SaaS-only solution providers that operate in the red, Plex is cash flow positive and spending more in R&D than ever before in order to fund and fuel this transformation.

For more than a decade and a half, the development team worked swiftly to build out robust functionality that connected the shop floor to the top floor, through practical (often customer-funded) innovation. But today we live in a different world. Both the pace of business and the pace of change are accelerating. The road to success is not necessarily a straight path. Disruption throws us some curves.

And therefore, Plex must find new ways of listening and new ways of solving problems – problems its customers might not even know they have. Apple (think Siri) and Steve Jobs provides some inspiration.

“Get closer than ever to your customers. So close, in fact, that you tell them what they need well before they realize it themselves.” Steve Jobs

Plex’s customers aren’t asking Plex to “decompose” its full suite, but customers like Accuride that operates Plex in some of its divisions, while also running SAP and Workday, see the benefit of being able to insert (Plex’s) MES in other divisions currently running SAP.

Customers transitioning from legacy, on-premise solutions face new challenges and have all sorts of different priorities. The shortest path to their goals may not be the traditional road, but rather a road less travelled. Customers (and prospects) that think artificial intelligence is still the stuff of science fiction aren’t asking Plex to predict machine failures on the shop floor, but they will most definitely benefit.

All this potential for change and disruption, shifting priorities and technology innovation makes the foundational work Plex is doing invaluable. And so are the new technologies it is introducing to its solution. There is nothing more exhilarating than accelerating out of a curve. If you are a Plex customer or prospect, buckle up… it’s about to get very exciting!

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Introducing QAD Adaptive Applications

Adaptive ERP and More, all built on the QAD Enterprise Platform

QAD Adaptive Applications is a portfolio of flexible solutions for manufacturers, with QAD Adaptive ERP at its core. Founded in 1979 by Pamela Lopker, QAD has always set out to provide an integrated system, laser focused on manufacturing. That focus has never wavered, but over time the underlying technology and the functional footprint have evolved. Just as Material Requirements Planning (MRP) evolved into Enterprise Resource Planning (ERP) for manufacturing, QAD’s solutions have also grown and matured. Even as disruptive technology is killing off older companies, QAD is still growing strong. But the leadership is smart enough to recognize, “What got us to here won’t get us to where we are going.”

For years now the company has been committed to the Effective Enterprise, defined as “every business process running at peak efficiency and perfectly aligned to the company’s strategic goals.” QAD remains just as committed as ever to this goal, but now adds the ability to adapt. In the words of CEO Anton Chilton, “We need the Adaptive Enterprise to sense – plan – act. For this you need a different kind of technology.”

The journey that led to this different kind of technology began at a pivotal point in 2013 when QAD mapped out what it wanted to achieve:

  • full functionality operating in the cloud
  • easy extendability with no or low code
  • modular upgrades without redoing extensions
  • Internet of Things (IoT) support
  • real-time analytics
  • a powerful, web-based user experience

This realization led to the launch of a multi-phased internal project, called the Channel Islands Initiative. By 2018, what started out as a user experience initiative had been been transformed into an enterprise platform. The result: a re-architected underlying application infrastructure, a fresh set of RESTful application programming interfaces (APIs), and a new future-proofed user interface (UI), including the framework for connecting devices.

While features and functions are still important today – actually more important than ever – the secret to “adaptive” applications lies in the QAD Enterprise Platform.

Click here to read the full report.

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Epicor: Firing on All Cylinders

More Cloud, More Connected, More Intelligent, More Innovation

Epicor’s mission is to be the cloud vendor of choice in the markets it serves. Those markets are manufacturing, the automotive aftermarket, wholesale distribution, service, lumber, and retail. Its latest user conference, Epicor Insights 2019, served to provide a progress report on that mission, including some exciting new product announcements. Over the past 18 months, the company has invested heavily in its major go-forward product lines. It has published 54 software releases (15 major, 39 minor), and brought a brand new Epicor Retail Cloud to market, completed as planned and on-time. As of three weeks before the event all its strategic product lines had been modernized and Software as a Service (SaaS) enabled. And its SaaS business is growing at an impressive clip, with year over year cloud revenue increasing over 90%. A brand new artificial intelligence (AI) based Epicor Virtual Agent (EVA) was unveiled at the event, along with new industry capabilities, built on cloud technologies, to power digital transformation and enhance the customer experience.

All of this news represents good progress, but Epicor is still fighting the battle of establishing a name for itself as what Mint Jutras last year called “the new Epicor.” As we noted then, “The Enterprise Resource Planning (ERP) market is very mature. Some solution providers have been around a long time, dating back to even before the acronym ERP was coined. Epicor Software Corporation is one of those vendors. With that level of maturity comes both pros and cons. On the plus side, as a mature provider, it brings to the market more than 45 years of experience and a set of robust and feature-rich products. On the down side, prospective buyers of enterprise software who might have encountered Epicor in the past may think they know the company and its solutions. But their knowledge and perceptions may be severely outdated.”  A year later, we (still) suspect many customers and prospects alike don’t really know the new Epicor.

The new Epicor is firing on all cylinders. Unlike the rigid, monolithic solutions of the past, its go-forward products are supported by modernized, component-based architectures that support connectivity, accelerate innovation and support the intelligence needed to compete in today’s global, digital economy. While Epicor still offers a choice of deployment models, it operates under a “cloud first” policy that encourages (but doesn’t force) customers and prospects to harness the power of the Internet. But not everyone seems to have gotten the memo. Perhaps if we review some of the recent steps Epicor has taken, we might be able to enlighten those who have not.

Click here to read the full report

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Oracle Enterprise Applications:  Speeding Innovation in the Cloud

With a Heavy Dose of Machine Learning

Oracle OpenWorld is a huge event, covering a plethora of topics. Here at Mint Jutras we focus exclusively on enterprise applications that run businesses. At the very core of those is Enterprise Resource Planning (ERP), but these days it is often difficult to tell where ERP ends and other applications begin. And therefore we often stretch the boundaries of ERP and also write about Enterprise Performance Management (EPM), Human Capital Management (HCM) and also the “Customer Experience (CX).” While we leave coverage of hardware, infrastructure and data base technology to other analyst firms, enterprise applications provided plenty of food for thought at Oracle OpenWorld 2018.

According to Steve Miranda, Executive Vice President, Applications Product Development, the two key themes driving his development organization are movement to the cloud and speed of innovation. These two are closely related. Mint Jutras has long been a strong proponent of software as a service (SaaS) for many reasons, not the least of which is the ability to deliver more innovation – that is also easier to consume – faster. Mint Jutras would agree both of these themes are necessary and commendable. Both address the inertia holding many companies back from being fully active, successful participants in the rapidly changing, global, digital economy.

In the recent Mint Jutras report Digital Transformation: It’s Time to Develop a Sense of Urgency, we discussed digital transformation in the context of enterprise applications. Where are we on this journey? You might be surprised by the data we have collected that indicates enterprises might not be as well prepared for the global, digital economy as they think. What is Oracle doing to remedy that situation?

What Is Digital Transformation?

In our previous report, we began our discussion by posing the question: What is “digital transformation?” In so many ways, in the context of the software that runs your business, it is simply delivering on the original promise of ERP. Mint Jutras defines ERP as an integrated suite of modules that provides the operational and transactional system of record of your business. Even the earliest versions of ERP did indeed provide this system of record. But did they live up to the promise of an end-to-end, integrated solution that could streamline and automate all your business processes? Did they make your life easier? No. The technology necessary to deliver on that promise simply didn’t exist back then.

In the meantime, the pace of change and the pace of technology innovation continue to accelerate. Today that pace is staggering and fortunately, the technology needed to deliver on that promise finally exists, and a lot of it sits in Oracle’s vast portfolio of products. However, not all of Oracle’s customers are able to take full advantage of these technologies simply because they are still running older solutions. We would call them “legacy solutions,” or sometimes “heritage solutions” – legacy solutions you are proud of. Indeed Mr. Miranda is quick to point out, “So we don’t have legacy customers. They may be on older software. But our customers are still always modern and going forward.”

In response, we would argue: All the more reason to get them off that older software and onto something more modern and technology-enabled. They need the ability to transact business digitally in order to actively and fully participate in the global digital economy. This requires a level of connectivity that is simply not possible with older, legacy solutions. Many of these older solutions pre-date the Internet, and let’s face it… the Internet has forever changed our world. It has created the global digital economy and it has leveled the playing field for entry.

In the past, only the largest companies were able to establish a global presence and trade on a world-wide basis. Today any company, large or small, can establish a global presence, creating unprecedented opportunities. We see new markets, new economies, and even whole new middle classes emerging every day. But as you start to expand your global presence, be careful what you wish for. Without digitally transforming the solutions that run your business, windows of opportunity will close as quickly as they open.

The Role Cloud (and SaaS) Plays

The Internet has truly changed our lives both from a business, as well as a personal perspective. As noted earlier, the Internet has leveled the playing field, making it possible for any company, large or small, to create a global presence and be an active participant in the global, digital economy. The Internet enables the cloud as we know it today. The ability to access software any time, from anywhere is inherent in any solution that resides in the cloud, opening doors for improved and increased usage. And let’s face it – solutions only bring value if they are actually used.

So, web-enablement is the first step. You can simply take your software that is licensed and installed either on or off-premise and improve access. Web-enablement is conducive to supporting distributed users. But taking the next step and running software as a service (SaaS) brings additional value: No capital expenditure required; no need to build out a data center or maintain hardware. The elasticity of a solution, including the ability to expand the number of users without over-taxing the supporting hardware and software, is critical during growth spurts. When your plans involve expansion, bringing up remote sites rapidly and easily is an added benefit and requires less information technology (IT) staff on site. This is especially important when you venture into new, emerging economies where local IT talent may be scarce or nonexistent.

While cyber-security is an understandable concern to all today, if you are a small to midsize company, without a dedicated IT security expert on board, chances are you assume more risk than you would in a SaaS environment. Even if you are a large company with IT security experts on staff, there is no way you will be able to match the level of investment Oracle makes in terms of security from infrastructure and software and business practice. Plus Oracle can deliver the peace of mind of business continuity in the event of a disaster, either natural or man-made.

Based on many of the reasons noted above, the majority of companies today see cloud and SaaS in their future. While customers vote with their wallets, each year our Mint Jutras Enterprise Solution Study seeks more clarity on preferences for different deployment options, including preferences of those that might not have (yet) decided to make a move off legacy software.

We have been asking the following question for years now: If you were to consider a new solution today, which deployment options would you consider? Participants are allowed to select as many as they wish. A summary of answers since 2011 is shown in Figure 1. We skip every other year simply to fit the chart on the page. SaaS is currently the option most likely to be considered and the willingness to consider traditional on-premise solutions dropped off dramatically between 2011 and 2013 and has not recovered.

Figure 1: Deployment Options That Would Be Considered Today

Source: Mint Jutras Enterprise Solution Studies

*Option added in 2015

But don’t let these preferences tempt you into thinking SaaS solutions will be prevalent in the very near future. Why not? There are simply too many existing on-premise deployments out there today, including some of the brands in the Oracle product portfolio (JD Edwards, Peoplesoft, Siebel…) Our most recent 2018 Enterprise Solution Study found about 40% of business solutions today are deployed as SaaS (Figure 2).

Figure 2: Percentage of Business Software that is SaaS

Source: 2018 Mint Jutras Enterprise Solution Study

Our survey respondents estimate that percentage will grow steadily, but it will take many years before SaaS solutions dominate. Mint Jutras believes the momentum is building and the transition will happen somewhat faster than Figure 2 would indicate. But the average company running legacy solutions on premise obviously need a gentle push.

Oracle Makes Moving to SaaS Easier

And Oracle is providing that gentle push. Earlier this year it introduced a new program called SOAR, a prepackaged set of utilities and methodology to get customers to the cloud. For customers running solutions like JD Edwards, Peoplesoft, Siebel, and even the E-Business Suite, this means replacing solutions. While some software vendors offer the same solution on premise and as a SaaS solution, allowing customers to simply lift and shift existing deployments, this provides limited value. In doing so you sacrifice some of the benefits of a multi-tenant SaaS solution (see sidebar). With multi-tenant SaaS solutions, vendors maintain a single line of code. As a result, they can deliver more innovation, at a faster pace. – one of Oracle’s stated goals. With single-tenant solutions running in private clouds, vendors and their clients still face the complexity and disruption of traditional upgrades.

Lifting and shifting also means you are dragging along any limitations of prior implementations. Oftentimes customers delay moving off of old systems because of customizations and yet many of those customizations were required, not to provide market differentiation, but to address functional gaps or other limitations of older solutions, or simply because that was the way things were always done. Today’s solutions are far more configurable and extensible, eliminating much of the need for invasive code changes. If an existing or proposed customization doesn’t provide differentiation, Mint Jutras advises against doing it. And if it does provide a level of market differentiation, look for ways to accommodate it without mucking around in the code. Look for component-based architectures that allow you to extend, rather than modify solutions.

Mr. Miranda seems to agree with these recommendations. When asked about existing customer perceptions around customization he said,

“… the more complex you are and the older implementation you have, the more strongly I would advise you, ‘Do not inventory your customizations.’ If you want an interesting archeological expedition, knock yourself out. What happens is they find things that they don’t even know why they did it. They don’t know if it’s relevant anymore. We have customers who customized things 15 years ago. We’ve actually added it to E-Business Suite. But they haven’t had the time to unravel it. I’m not saying this in a critical way; it’s just a reality. What I strongly encourage the customers to do is look at the baseline product. And guess what? There may be things that are missing that we haven’t built. But you won’t need an inventory of your customization to figure that out. You will know what’s relevant.

Through the SOAR program customers can see the depth and breadth of the product, and determine, with a level of certainty, how long it is going to take to get there. How much is it going to cost them? And when they come out the other end, what they will see in terms of improvement in business practice. In Mr. Miranda’s words:

“So, based on our experience of existing customers, we developed a set of utilities with Oracle Consulting that can take what we think is a reasonable scope – a certain number of integrations, certain number of reports, certain number of extensions. We’ve done the work to automate the data migration. We know how much it’s going to cost in terms of each migration or each extension or each report. And so, we can quickly give you an estimate. Here is your size and shape. Here is your cost. Here is your time. And here’s what we believe, based on a typical customer, will be the amount of business process change/improvement.”

Speeding Innovation

So, cloud is the first step towards speeding innovation, but there’s more to it than that. You also need some foundational technologies, which we still find lacking in the majority of businesses today (Table 1).

Development platforms and microservices architectures, on which applications are built, are the perfect example. For the reader with a technical background, a microservice architecture is defined (by Wikipedia) as an architectural style that structures an application as a collection of loosely coupled services. For those nontechnical readers, think of it as constructing a solution from a set of Lego building blocks.

Table 1: Embedded (or foundational) digital technologies

Source: 2018 Mint Jutras Enterprise Solution Study

Think about how you build a structure from Legos. Each Lego block is made of the same kind of material and is attached (connected) to the other Lego blocks the same way. In many ways they are interchangeable. But by choosing different colors and sizes, and connecting them with a different design, you can make a structure that is very unique. And once constructed, if you want to change it, decoupling some of the blocks and replacing them doesn’t destroy the parts that are not affected. There is far less disruption introduced than if you had constructed it with a hammer and nails.

These platforms and technologies provide a level of agility, configurability and extensibility to today’s applications to help us respond to change. Oracle has invested heavily in both its Platform as a Service (PaaS) and its Infrastructure as a Service (IaaS), resulting in its Oracle Cloud Infrastructure (OCI). It is now turning its attention to other foundational technologies like machine learning and natural language processing (NLP). But it is approaching these differently than some of its major competitors. Instead of providing these technologies as tool sets, Oracle is embedding them into applications so that customers of all sizes (not just those with deep pockets and large development staffs) can take advantage of them “right out of the box.”

Throughout the entire suite of application products, the concept is to turn what used to be “input-receiving” apps into “recommendation” apps. Examples include suggesting the next-best offer or the next-best action in CRM. Or they might help prioritize employee recruiting in HCM or make audit suggestions and cash-management recommendations in ERP.

Digital assistants (bots) will be available pervasively throughout the ecosystem, not only from your phone and through SMS, but also through Slack, Siri, Alexa, or Google Home. The way people work is changing, so the applications must change too.

Mint Jutras believes this approach to embedding these technologies is smart. Notice Table 1 captures not only current adoption rates, but also plans for adoption. We also allowed survey respondents to indicate where they expected software vendors to simply provide these technologies with no additional purchase required (the next to the last column). Few are demanding this today, or even expecting them. And yet Oracle is working on delivering them, much like Apple delivered Siri. Apple customers didn’t demand the ability to converse with their mobile devices. Apple just delivered it. Other device manufacturers followed suit. Pretty soon virtual assistants became commonplace features. And people got hooked. It was only after the value was recognized that people willingly went out and bought stand-alone devices like the Amazon Echo Dot and Google Home.

Now is the time to bring them into the enterprise, much like they were insinuated into our personal lives. Pretty soon these types of technologies will be generally available throughout the Oracle Cloud, but you won’t be able to take advantage of them if you are still stuck on old legacy solutions.

Develop a Sense of Urgency

As we noted in our report on Digital Transformation, it is time to develop a sense of urgency – the same kind of urgency Oracle has demonstrated in urging customers to move to the cloud in order to speed innovation. The digital age is upon us. The pace of change and the pace of technology innovation has accelerated beyond anyone’s expectations and it doesn’t show any signs of slowing down. We live in disruptive times.

We asked our 2018 survey participants to assess the level of risk their industries faced in terms of the potential for disruption.

Figure 3: What risk do you face in your industry being disrupted?

Source: 2018 Mint Jutras Enterprise Solution Study

While all but 10% acknowledged some level of risk, the majority (84%) feel the risk is low to medium rather than high or imminent. Yet we feel compelled to ask the question: How do you think the taxi industry would have answered this question on the eve of the launch of Uber? Nobody saw that disruption coming and therefore few (if any) were adequately prepared.

Disruptive change is nothing new, but the speed with which it can impact business models and revenue flows has certainly changed. While it took a decade for the personal computer to disrupt the computer industry, and years for digital photography to disrupt the film industry, it took less time for Netflix to put Blockbuster stores out of business. And how long did it take Airbnb to impact the hospitality industry or Uber to disrupt the taxi industry? These kinds of disruptions can happen virtually overnight, creating new ways of transacting business that can have a cascading impact on both front and back office applications.

This type of disruption might come from a variety of sources. We asked survey participants to select the single most likely cause of potential disruption (Figure 4).

Figure 4: What is most likely to cause this disruption?

Source: Mint Jutras 2016 Enterprise Solution Study

While the threat from new, innovative products may have the lesser disruptive impact on business processes and business models, it does require companies to place more emphasis on innovation. Windows of opportunity can open and close very quickly. Of course an agile ERP solution isn’t all you need to accelerate new product introductions, but you also don’t want it to be the reason you can’t respond to new market demands or take advantage of new and unprecedented opportunities.

New ways of selling/pricing existing products might include subscriptions to services or outcomes that replace outright sale of products. Rather than selling a machine, you might invoice for uptime or hours of production. You might ship a physical product for free and charge for usage and/or consumables. Software companies that used to offer perpetual licenses might now also (or instead) offer subscriptions to software as a service (SaaS). These types of changes can have a major impact on how you invoice, recognize revenue and manage cash. And these changes must be reflected in your ERP solution.

The impact of entirely new business models is even harder to predict because of the inherent “newness.” You don’t want your ERP solution to be the reason you can’t capitalize on that brilliant new idea that can create a new revenue stream. Your ERP must adapt as your business evolves.

And yet many hesitate to replace or upgrade aging solutions that have no hope of ever connecting with or leveraging the emerging digital technologies required to survive in today’s digital economy. Perhaps they are looking for proof they will not be taking a step backwards in moving to a newly developed solution. Indeed, there are some industries that may (still) be better served by some of its older, deeply entrenched products – industries like food and beverage or project-based businesses. These industries are still on the horizon for the Oracle Cloud solutions.

But perhaps the best customer reference for a wide range of industries comes from Oracle itself. The diversity of Oracle’s business is a testament to the breadth of the solution in a world of changing business models.  Oracles runs:

  • an on-premises software business
  • a subscription software business
  • a reasonably large consulting services business
  • a reasonably large, assemble-to-order, hardware business
  • a procure-to-order business for Micros on smaller machines

We wrap up with a quote from Mr. Miranda.

“We spent a ton of time combining feature functions we needed, technical innovations that either we built or the industry built, so now we have what we think is an extremely compelling, deeply functional, and differentiated solutions in just about every area: EPM, ERP certainly, now with Supply Chain Manufacturing as well…. Core HR including global core HR, benefits, payroll; and then CX being sales, service, marketing, both B2B marketing … and B2C marketing…. It is just an incredibly feature-rich area on top of those baseline components.”

The entirety of Oracle’s business runs on the same software in the cloud that all of its customers are running. That spells confidence and commitment.

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Plex Systems Accelerates Push Into IoT With DATTUS Acquisition

Customers: Prepare for a Tsunami of Data

On July 31, 2018 Plex Systems, a cloud ERP and MES solution provider for manufacturing, announced it had completed the acquisition of DATTUS, Inc. a leader in Industrial Internet of Things (IIoT) connectivity technologies. This is an important step in executing on its product strategy, which includes connecting to more IIoT data for more actionable insights, along with enhancing manufacturing and business processes.

As a solution provider of enterprise resource planning (ERP), the Plex Manufacturing Cloud provides the operational and transactional system of record of your business. But looking beyond business transactions, Plex’s goal has always been to connect the shop floor to the top floor. But that is often easier said than done.

While sensors, machines and equipment on the shop floor have been collecting vast volumes of operational data for decades now, that data has not always been “connected” or accessible for decision making. Indeed the very fact that this data collection has been happening for decades contributes to the problem. Many of the machines and software put in place decades ago pre-date the Internet and therefore have no ability to connect to a network. Retrofitting equipment or replacing it is expensive and most of these machines were designed to last a lifetime. Expensive custom integration projects are beyond the expertise and budgets of all but the largest manufacturers. So what’s the alternative?

Providing an alternative is what DATTUS is all about. DATTUS solutions connect manufacturing equipment and sensors to the cloud. Think of it as the bridge between you and your machines. The platform is a hardware/software combination, which collects data from PLCs, VFDs, industry protocols like MTConnect, and popular enterprise applications including Salesforce, SAP and (of course) Plex.

In addition to this plug and play connectivity, DATTUS also brings IIoT data management and industrial analytics. The data management and analytics capabilities previously offered by Plex were sufficient for managing the volumes of data within ERP. But as customers are empowered to bring almost any data stream into the Industrial Internet of Things, they now need to be prepared for a tsunami of data.

Giving Manufacturers a “Leg Up”

The IIoT is just one of several inter-related digital technologies we continue to watch, and what we most often see is limited progress being made in terms of leveraging these technologies. Our 2018 Mint Jutras Enterprise Solution study explored plans and investments in selected digital technologies normally associated with Industry 4.0. We find very low rates of adoption (Table 1) and many have no plans to change that. In spite of all the hype around all these technologies we confirmed many are still sitting on the sidelines of the latest manufacturing revolution.

Table 1: Digital Technologies Plans and Investments in Manufacturing

Source: 2018 Mint Jutras Enterprise Solution Study

*Includes those that expect vendors to deliver at no additional cost

Running legacy solutions based on outdated technology forcibly sidelines some. And others are hamstrung by decades-old equipment on their shop floors. Plex Systems’ acquisition of DATTUS can’t help with the first unless those running legacy solutions are willing to trade up to a more modern, technology-enabled solution. But it can help in connecting those disconnected machines.

While all adoption rates are quite low, we do find IoT has the lowest percentage of manufacturers with no plans and no activity and close to the highest percentage of those that have already made some investment (second only to 3D printing). This tells us manufacturers have at least a grasp of its potential. Indeed manufacturers have been collecting vast volumes of data from sensors on the shop floor for decades. And yet that data has gone largely underutilized because manufacturers fail to connect the data back to the enterprise applications, and the business decisions. And this is where DATTUS can open new doors.

Instead of retrofitting equipment or developing custom connections, the DATTUS platform provides “out-of-the-box” direct connectivity for machines using cellular capabilities. It can capture data from non-networked, discrete industrial assets while remaining agnostic to data type, machine protocol, and infrastructure. It is a hardware-agnostic IIoT solution that can reliably collect and manage data and make it available for further analysis and open doors to several other of the technologies listed in Table 1.

The availability of more data increases the need for analytics in order to make sense of it. The data within an ERP solution lends itself to historical reporting and perhaps even ad hoc queries. Both are designed to answer questions you already have. But where do you turn when it is not intuitively obvious which questions you should be asking in order to optimize production or grow your business?

Therein lies one of the primary differences between reporting and analytics. While reporting answers a series of pre-defined questions, the discovery process and the iterative nature of analytics helps you ask the right questions. Reporting helps you identify a problem. The right kind of analytics helps you avoid it. Reporting seldom helps you recognize an opportunity. Analytics help you seize it.

But as volumes of data start to grow exponentially, you eventually reach a point where the human mind is no longer able to assimilate and cope with that volume. This is where machine learning can add a level of intelligence that is simply not possible without technology. Data sets have grown rapidly in recent years, thanks, at least in part, to information-sensing devices such as those to which the DATTUS solutions connect.

And the shop floor provides us with some of the most often cited use cases for artificial intelligence and machine learning. The ability to constantly scan data collected by machinery and equipment on the shop floor, searching for patterns that have previously led to failures, have saved manufacturers countless hours (and costs) associated with preventive maintenance. By predicting failures, you only need to bring production to a halt to perform maintenance when it is really needed.

Similarly, in environments regulated by strict adherence to specifications, by monitoring sensor data continuously, machine learning can alert operators before out-of-spec product is made. While shop floor supervisors are only able to scan, monitor and cope with a limited amount of data, machine learning knows no such limitations. Machine learning can recognize patterns and correlate data points that a human does not recognize as relevant. And as more data is gathered, it keeps on learning. That is what continuous improvement is all about.

DATTUS adds capabilities for analytics on data-in-motion, quickly providing insights in support of decision making on the shop floor. This includes:

  • Anomaly detection (quality control)
  • Custom event rules
  • Real-time production and efficiency reports
  • Performance forecasting
  • Predictive analytics
  • Machine learning

As part of Plex Systems, we also see the potential of applying these industrial analytics capabilities to the business side of the equation within ERP for supply chain planning, financial planning and budgeting, forecasting and more. The possibilities are endless.

Mint Jutras believes these digital technologies are destined to be absorbed into the enterprise in general, and manufacturing in particular, in much the same way as technologies like artificial intelligence (AI) and natural language processing (NLP) have insinuated themselves into our personal lives.

Think about it. As consumers, we didn’t loudly voice our desire for AI or NLP. But that didn’t stop Apple from delivering Siri on an iPhone. Pretty soon Microsoft delivered Cortana on Windows 10; Google delivered Google Now; Amazon delivered Alexa and now Bixby is on your (newer) Samsung Galaxy. We see these digital technologies being absorbed into the manufacturing landscape in much the same way, as long as solution providers like Plex and DATTUS continue to innovate and push them into the mainstream.

Conclusion

While the technologies in Table 1 are typically outside the scope of ERP, in order for them to be truly transformative, they must interoperate and/or integrate with the enterprise applications like ERP in the front and back office. When purchased separately it is often a daunting task to connect back to ERP and in turn, the business itself. But without this connection, factories don’t get any smarter and neither do the leaders making business decisions. And that’s the real goal of digital transformation in manufacturing: a smart factory and smarter business decisions. And therefore this acquisition makes perfect (and practical) sense.

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Workday Family of Planning Applications Grows

Proposed Acquisition of Adaptive Insights

A couple of years back, in May 2016 Mint Jutras posed the question: Is Planning & Performance Management A Marriage Made In Heaven? We concluded that if you find the two live entirely separate lives, either consciously or unconsciously avoiding each other or (even worse) they are in a contentious relationship, perhaps it’s time for a divorce. Conversely, with the right solutions, you can marry actual performance to the plan, in all the relevant detail. And that plan can evolve over time to lead you down the most effective path to growth and profits. Ahhh… marital bliss!

That same year we reported on how Workday Brings the “Power Of One” To Planning and Analytics, having wedded the two by unifying financial and workforce planning with transactions in one cloud system. Organically built as part of the Workday system, the new (at the time) planning application was designed to simplify setup and support collaborative planning. Since then about 250 Workday customers have subscribed to the solution, but those customers and a maturing market is pushing for more. Workday’s recent announcement of its intent to acquire Adaptive Insights and its cloud-based platform for business planning signals a commitment to accelerate the delivery of exactly that – more and better planning.

From a Marriage, A Family Emerges

Any marriage starts off as a two-some, but marital bliss often results in a growing family. If we start off with the concept of marrying planning and performance management, the natural offspring would be the different components of planning. It all starts with a business plan, followed by financial planning, budgeting and workforce planning. Of course Workday could conceive, give birth to and nurture these different components through its own development efforts. But just as the capacity of two people to go forth and multiply is limited by the human gestation cycle, so is the ability of a software company limited by software development cycles. To grow a human family more quickly, couples might choose to adopt. To grow a software portfolio more quickly, companies might choose to acquire.

But if a company chooses the merger and acquisition (M&A) route, how does it ensure the product acquired doesn’t turn into the redheaded stepchild? This often happens because some companies aren’t very good at integrating acquired products and companies. However, Workday happens to do this very well.

Preserving the “Power of One”

Workday’s strength lies in what it calls the “power of one” – one code line, one security model, one mobile app, one data model, one user experience (UX), one platform, one version. And the “power of one” has already survived several acquisitions.

Workday’s acquisition of Identified in 2014 was an important step in incorporating predictive analytics and machine learning into its repertoire of capabilities. Identified’s patented SYMAN (Systematic Mass Normalization) technology mines Facebook for social data and then uses artificial intelligence to transform that data into professional intelligence. The machine learning comes from continued use, validating predictions with outcomes from Workday employee data on performance and retention.

After acquiring the technology in early 2014, Workday released Workday Talent Insights in 2015, identifying retention risk and delivering a talent scorecard. Workday learned that customers preferred an embedded experience, not a standalone application and that the overall user experience was key, along with access to data for training algorithms.

In 2015 it acquired Gridcraft and in 2016 it acquired Platfora. With both of these acquisitions, it has woven the technology into the fabric of its solution, rather than bolting on components. More recently it announced the acquisition of Rallyteam, for the express purpose of adding more intelligence to optimize talent. In its accompanying blog post Workday said:

“With Rallyteam, we gain incredible team members who created a talent mobility platform that uses machine learning to help companies better understand and optimize their workforces by matching a worker’s interests, skills, and connections with relevant jobs, projects, tasks, and people.”

It would appear that this acquisition was made for the express purpose of acquiring talent to accelerate its machine learning efforts, and therefore poses no threat to diminishing Workday’s power of one.

But the acquisition of Adaptive Insights is a different animal. Adaptive Insights has been a Workday certified partner since 2015 and the two companies have somewhere between 30 and 40 joint customers, so integration already exists. Workday has already stated it will harmonize the data models of the two solutions and Aneel Bhusri, co-founder and CEO of Workday is committed to applying the power of one. However this is a very small slice of the 3,800 Adaptive Insights customers and part of the mutual attraction between the two companies is their shared customer-centricity. The benefit to the Workday installed base is obvious. But it is unclear what impact this will have on and the potential benefit it will bring to the larger population of Adaptive Insights customers.

It is also too early to say exactly how and when Workday will preserve its power of one, although Mint Jutras suspects the two companies will be hard at work figuring that out even prior to the anticipation of closing the deal later this year. Workday has admitted in the past that bringing innovation and acquired technology to the (Workday) market has been slower than some might expect because additional care and effort is taken to embed innovation at the platform level. Again, the benefits to Workday customers is clear, but the impact on Adaptive Insight’s non-Workday customers is unclear.

Also unclear is the impact on any pre-existing partnerships Adaptive Insights has with other ERP players. One in particular, Plex Systems, will likely be preserved because of Workday’s existing partnership with Plex. The two solution providers partner to present a cohesive two-tier solution (Workday as the corporate financial and human capital management solution and Plex Systems at manufacturing subsidiaries), so a shared planning platform between corporate headquarters and subsidiaries could be a huge plus. Plex also runs Workday to manage its own (software) business.

Conclusion

The acquisition of Adaptive Insights appears to be mutually beneficial to both companies. Workday stands to accelerate its financial planning and budgeting roadmap while freeing up some of its current staff to concentrate more fully on the workforce planning aspects of its current planning solution – a particular strength of Workday. Adaptive Insights finds a home that is compatible with its employee and customer-centric values and will likely be able to come up market a bit.

There are still many outstanding questions as to how Workday will preserve its power of one, a key strength and differentiator. But both parties seem committed to the concept and we suspect they will be hard at work figuring it all out even before the ink is dry on the final deal.

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