Podcast from IFS Unleashed: Focus on small, medium-size manufacturers

Below is an excerpt from this podcast:

Scott Achelpohl: Can you break down what IFS does for companies just getting started with its products? In the past, we've heard a lot about add-on modules, asset lifecycle management, and, let's just say the word, scalability. Where does IFS start with a new customer?

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Andrew Burton: There is a discovery phase with a new customer. And just to pick up on what you're saying about scalability and modules, IFS is one database, so we sell them functions within that database. So, a customer, small, medium, large, can come in big, medium, small, however much they want. They might have an existing ERP system, but they want to bolt in an EAM, asset management system.

We could just give them the asset management part of the database and interface it to their existing ERP system with the hope that they're so impressed with the asset management that they want to push out the old ERP system because it's more integrated and then take IFS ERP. The same is true the other way. Most manufacturers have assets on the shop floor, so they start off in a small way, but actually might want to grow into a proper asset management system.

As a customer, you only buy what you need, what you pay for. So, we create what we call a solution map for a customer. We've got standard ones for different sorts of manufacturing. Our industry focus gives us those standards, but every customer is unique or likes to think they're unique. We can tweak, we can add in bits, we can take bits out depending on what they're looking for. They may have third-party software.

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You may be going into a lab that has some very specialized third-party applications. So IFS cloud is very easy to access through rest APIs, and the API call is the same because it's the same database. You're not calling data from different places. You're calling it from the same place.

Dennis Scimeca: So you’re selling individual modules to fill holes in customers’ stacks in the hopes that they’re so impressed with that module that they push out to other portions of your stack?

AB: They grow out into the existing stack, if that's how we phrase it. It's not modules. It's scalable. They're not separate databases. We're not plugging them together. For example, our sustainability, it's built in. Remanufacturing is an enhancement, if you like, a fairly big enhancement, to the standard bill of materials way of working. So, we've used the functionality that we've got already and brought in more functionality. Instead of plugging on a module on the side, it's in the core product.

SA: IFS seems to go from moderately sized solutions to the fairly complex. Beyond your biggest customers, how does IFS serve small- and medium-sized customers?

AB: In a similar way to the way I've just mentioned. Actually, we like the complex customers where they've got lots of bits and pieces because we know we can interface to them very easily and we can connect to those modules. And through the fullness of time and seeing the product, hopefully they will then move into IFS. That's the thinking behind that.

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So, they may not have the money to replace everything. They may not be able to. It's just not feasible for them to change everything all at once. We don't just sell software. We work with our customers. We’d like to keep them, so we work with them. It sounds corny, but we're on a journey. We're in it with them.

SA: Here's where I'm asking you to pull out your crystal ball a little bit. In which directions does the company anticipate the market going in the next five years?

AB: Well, let's think about this. So, the crystal ball is very cloudy at the moment because who knows what it's going to look like in five years. But thinking about it, I can only think that the rate of change of delivering software will increase. We're doing it every six months with our evergreen program at the moment.

Most manufacturers can keep up with that just about. They tend to take our updates annually rather than every six months. They choose which ones they want. It's not forced on them. They can take what they want, when they want, because one may not have any impact on the modules that they're using on the parts of the system they're using. So they'll wait until there is, and then they'll roll it all out. Gone are the days of the big implementations.

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Tom Wilk: We've been paying attention as a business group here, our three brands, on new manufacturing plants opening up in the past couple of years. We’ve noticed a lot of heavy activity in the EV battery manufacturing market and, thanks to the Chips Act, microchips. From my perspective, it's interesting though, because if there aren't as many food plants opening up, we've seen food and other manufacturing verticals invest in maintenance technologies. So not new plants but investing in the health and maybe dropping some CapEx spending on some new tools for monitoring.

What are you seeing in the manufacturing market? Do you see new builds, especially with EVs, needing these products? Do you see other sectors?

AB: If we're talking EV and we're talking passenger vehicles, we work with niche manufacturers at the moment. We don't have any big names like the Fords, the VWs of the world. We have smaller names which we're working with. They’re existing petrol cars, but we're working with them to transfer to EV power. Startups tend to come in with that. We've got a couple of customers now who are last-mile delivery EVs. We've got a couple of those and a couple of small people mover sort of customers. We have drones and unmanned vehicles. We have manufacturers of those as well.

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So in the EV market, yes, it's growing and although we don't have a major manufacturer in the EV market, we can do it. We also have inquiries from people. They've seen our remanufacturing software, and they want to look at remanufacturing batteries. We feel that that's going to be something. We can use our remanufacturing software to recover batteries.