When it comes to describing IFS customers and IFS itself, the word of choice this week at IFS World Conference (WoCo) is ‘challengers.’
Challengers is apt for IFS, which seeks to further differentiate its approach from that of other mid-market ERP players while, at the same time, looking to face off more against enterprise applications behemoths Oracle and SAP. According to IFS CEO Darren Roos, in his keynote address, many IFS customers are also challengers, since they’re “typically not number-one or two in their industry,” but they have ambitions to grow and unseat those incumbents, often by reinventing their businesses.
Long-time IFS customer Jotun, a leading manufacturer of paints and coatings, exemplifies that goal. As Morten Fon, Jotun president and CEO, explained at WoCo the company has been the “fastest-growing paint company in the world for many years,” and, as a challenger, is continually moving into new markets and trying new solutions.
For instance, with its embrace of IoT technology, Jotun is now able to receive real-time information back from its coatings on sailing vessels at sea all over the globe. “In the old days, we were selling volume coatings; now, we like to think we’re selling efficient hulls,” Fon said. Jotun can alert customers to when they need to maintain the coatings on their vessels, making it a “better partner for our customers.”
At the same time, Jotun has the challenge of balancing global processes with local needs, while also standardizing as much as possible in order to become more efficient to compete in future.
Play to Existing Strengths
After giving thought to the niches where IFS could really stand out, CEO Roos and his team decided to double down on areas which have traditionally been core strengths for the company – enterprise asset management, enterprise resource planning, and field service management – the latter to be augmented by the newly-announced planned acquisition of FSM vendor Astea.
“As our competitors’ messaging is becoming increasingly abstract and unfocused, we needed to focus on building real depth for our customers so they have to do less to become disruptive,” Roos said.
The strategy is also to continue to “go deep” into industry solutions to help customers achieve a faster deployment and a more rapid time to realize value; to make IFS applications more intuitive and easier to use; and to deliver a lower total cost of ownership than in the past. The five key industry sectors for IFS remain aerospace and defense; energy, utilities, and resources; engineering, construction and infrastructure; manufacturing; and service industries.
Debuting in 2019
Over the past year, IFS has delivered updates across its product portfolio and its new Aurena user experience is now available across the entire IFS suite along with native OData-based RESTful APIs. At the conference, IFS also unveiled three new offerings designed to provide customers with additional support – IFS Community, IFS Success, and IFS Connect. As Oracle before it, IFS is ‘drinking its own champagne’ by demonstrating how ‘IFS Runs IFS’ in terms of its move to IFS Applications 10.
Dan Matthews, CTO at IFS, discussed the three approaches IFS is taking to enable customers to tailor its software to their own way of working – “to make it yours.” Customers can extend the IFS data model themselves or working with consultants; they can extend IFS solutions from the inside by taking advantage of using more developer-type functions; or from the outside, via third-party development tools. Along with making 15,000 OData RESTful APIs available, IFS has joined the OpenAPI Initiative. The goal is to empower customers to use “a more modern way of doing integration,” whether connecting to SaaS applications or developing new services linked to machine learning or IoT.
Matthews talked about IFS’s ongoing commitment to offer customers choice, for instance, cloud or on-premise deployment as well as feature parity across both deployment options and portability to go from on-premise to cloud deployment and vice versa.
“We’re working relentlessly to reduce the risk to upgrades,” Matthews said, talking about IFS’s promise to run more “evergreen.” Coming in 2020 is a plan for IFS to introduce “new functionality in a way that’s optional,” he added, so that customers can determine when to turn on specific new features. IFS also intends to “completely reimagine the application lifecycle experience,” and offer customers “something better.”
Intelligent and Autonomous
IFS is investing more than double in R&D than it did three years ago, according to CEO Roos. As Christian Pedersen, chief product officer at IFS, took the stage in the second half of the main keynote, he gave a brief history lesson of how IFS has evolved from a mainframe software vendor through to the cloud. “What’s coming next is the intelligent and autonomous enterprise,” he said.
At the same time, IFS is continuing to build out more partnerships and expand on existing relationships. For instance, highlighted at the conference was the “great technical partnership” with Microsoft, which is now evolving or expanding into a go-to-market partnership. IFS expects to continue its work with the Aurena digital assistant bot, which is based on Microsoft’s Azure bot technology, as well as work with machine learning.
Digital transformation and digital disruption are playing a key role in how IFS thinks about the future, according to Pedersen. When looking at digital twins, contextual intelligence, augmented and mixed reality, IoT, automation and robotics, advanced simulation and optimization, and additive manufacturing, IFS advises customers to adopt a combination of emerging technologies, rather than a single technology.
“Eighty percent of IoT projects fail today,” Pedersen said. “But if you combine IoT with AI and business rules and preventive maintenance, then you can put the technologies in the context of what you need.”
The Challenge of Innovation and Digital Transformation
Among the challenges all organizations face is how best to approach innovation and digital transformation. As Jim Heppelmann, president and CEO of PTC, reminded the audience during a panel discussion on both topics, the meaning of transform is “to change form, to find a new form, not to optimize the existing form.” That new form may be how an organization engages with customers, a new business model, and/or a completely different way in which to run internal processes.
The most successful technology projects are those which “represent an intersection of what’s technically possible, really important, and scalable across the enterprise,” Heppelmann said. What organizations tend to forget about most often in his experience is considering upfront what the importance of a project will be to the business. Instead, the starting point of the project will have been technology-based, for instance, “we want to do blockchain,” which means the project later heads back to “pilot purgatory” as being seen as interesting, but not useful.
Dr. Joerg Hoffmann, CEO of AUMA Riester, a mid-size German designer and manufacturer of electric actuators, agreed with the necessity of establishing a business need at the start of any major project.
“Before we started with IFS ERP, we made it very clear what we want to get out of ERP,” he said. AUMA has measured a 30 percent reduction in lead time from manufacturing to delivery to customers since adopted IFS ERP, Hoffman added. He also advised that organizations engage with the experts on their teams to deliver a successful outcome for their projects. “Make sure that the experts in your organization support change and are willing to work in a different way, and ensure that you keep them motivated for the new system,” he said.
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