IQMS Prospers by Helping Enterprises Work Smarter
P.J. Jakovljevic - April 4, 2005

Event Summary

While we may sound like a broken record by harping on how enterprise vendors—especially the smaller ones—need to have a sharper focus, it is always worthwhile mentioning. Any vendor can thrive in this difficult business climate with global cutthroat competition, if it has a focused, complete, and compact solution. This, accompanied with a great value proposition in terms of services, maintenance, and support after the product is installed, will create a winning combination.

For these reasons, IQMS (www.iqms.com) has had a period of growth and expansion in the last few years when other vendors have had difficulty. IQMS is a privately held, Paso Robles, California-based (US) developer of EnterpriseIQ, which is one of the industry's leading enterprise resource planning (ERP) solutions for repetitive manufacturing environments, particularly for the injection plastics molding/extruding and rubber industries. In mid-January, IQMS announced that the globalization of manufacturing resulted in a 20 percent growth in its 2004 revenue. IQMS attributed this to double-digit growth in its sale of new systems and to positive revenue opportunities from its new Professional Services Group.

Highlighting IQMS' ability to serve the multilingual, multicurrency, and multiplant ERP needs for global manufacturers, in 2004, one in four new IQMS customers was reportedly located outside the US, in countries such as Mexico, Canada, Ireland, Sweden, and China. EnterpriseIQ is a multilingual system available in German, Dutch, Swedish, and Spanish and was recently released Chinese versions.

For IQMS, this growth follows a 12 percent increase in new system sales and a 17 percent growth in revenue in 2003, when it reportedly added more than 700 new licensed users. These additional users resulted in a 12 percent increase in its global (albeit still nascent) client base. To better serve new and existing clients, IQMS has expanded its US Midwest office offering additional training and sales support.

These new contracts also represented a significant expansion of the types of industries where the EnterpriseIQ solution can help capture data, track operations, and improve efficiencies throughout the manufacturing process. The company's new clients span various industries, including automotive, construction, electronics, furniture and fixtures, medical devices, appliances, construction, housewares, packaging, and transportation. With additional offices in Chicago, Illinois (US); Toronto, Ontario, (Canada); and Ede, the Netherlands, and with resellers in other geographic regions, IQMS boasts an installed manufacturing customer base of over 300 companies with more than 5,000 users on four continents and in ten countries. With a proven track-record and by operating in a (presumably) rebounding economy, IQMS believes it is positioned for even stronger growth and market expansion.

IQMS Background

IQMS, which supposedly stands for “intelligent quotient (increasing) manufacturing systems”, has grown steadily since 1989 when it was founded by seasoned manufacturing savvies. Its first ERP module evolved into EnterpriseIQ. EnterpriseIQ is now an extended-ERP suite that is possibly the most comprehensive single-source software solution available among its peer industry solutions. Namely, IQMS points out that core ERP software is a strategic business application that integrates financial, human resources (HR), manufacturing systems, and other typical corporate functions.

However, extended-ERP software (or sometimes referred to as ERP II, a term coined by The Gartner Group), extends ERP information to other interested users, presumably with no barriers to the data flow (see Enterprise Applications—The Genesis and Future, Revisited). Accordingly, EnterpriseIQ provides extensive business management functionality that was previously available only through solutions from multiple vendors. Such functionality included real-time production monitoring, warehouse management, job shop tooling, quality control, supply chain connectivity, customer relationship management (CRM), and preventive maintenance. Also, IQMS touts that EnterpriseIQ's integrated modules, which are based on an Oracle-powered, single database solution, deliver improved implementation, ease-of-use, and efficient administration for manufacturing companies.

The company also emphasizes that it is a complete enterprise solution provider in terms of one-stop-shop development, programming, sales, implementation, and support services. Consequently in mid 2004, the vendor announced the expansion of its IQMS Professional Services offerings, a group that now provides two programs in addition to IQMS Implementation Services. The EnterpriseIQ Application Analysis (EAA) service assists users of EnterpriseIQ with achieving the outstanding use of the system and helps manage today’s rapidly changing business environment by mapping ERP functionality to specific customer needs. The service provides a survey of current business practices; an analysis detailing areas of improvement; an assessment of the use of the current system; and acts as an advocate for software enhancements that better serve the customer. Customer feedback through Professional Services is used to enhance EnterpriseIQ.

On the other hand, customers seeking assistance with rapidly upgrading and integrating new functions and features can take advantage of the newly offered Upgrade Installation Program. In addition to implementation services for new EnterpriseIQ users and on-line support for continuing customers, IQMS hopes that by expanding its professional services, it will establish a direct, clearer path for customers’ changing business needs.

Also in 2004, IQMS announced an upgraded version of EnterpriseIQ with a host of new features and functionality that expanded its business intelligence (BI) offering. The upgrade is part of IQMS' ongoing drive to continually strengthen and improve EnterpriseIQ and includes a series of incremental, yet operationally significant improvements to help businesses better capture data, track operations, and improve overall efficiencies. These upgrades include dozens of new reporting features, alert options, CRM, and electronic data interchange (EDI) additions.

IQMS strongly believes in a partnership with its customers. Through annual user groups and on-line forums, customers have reportedly suggested and requested features for EnterpriseIQ that help them better meet their unique and evolving business needs. IQMS has used this feedback to improve its product. Moreover, since IQMS’ inception, the vendor guarantees customer success with a money-back, one-year guarantee. This partnership, backed by the guarantee, helps IQMS to grow and improve its system. Additionally, for all existing IQMS customers, the EnterpriseIQ upgrade is available at no charge in the spirit of the “Perpetual License” concept where existing customers receive every upgrade free.

Further, IQMS supports a structured call escalation procedure that involves the testing and development departments at IQMS. It boasts that when customers call for support, they will speak to knowledgeable technical support personnel, who will make every effort to resolve any issues right then and there. If it cannot be resolved, then the call is escalated through the system. The goal is to get to the heart of the problem as quickly as possible, provide a solution, and keep IQMS customers running. To reduce costs, the support office uses multiple technologies to provide rapid, accurate support. For instance, connecting to the customer's system via the web or through a direct connection allows support technicians to work directly with customer data, within the customer’s security policies. This should allow support to quickly find the issue and either make adjustments or suggest additional developments to solve customers issues.

IQ Quality Management

One of the upgrades in the IQ Quality Management module is deviation tracking, which follows deviations in processes within the manufacturing environment and works with the engineering change orders (ECO) and corrective action reporting (CAR) tracking modules. This workflow-enabled technology supports electronic signature-based approvals via the Web or an intranet, and can be linked to the creation of bills of materials (BOM), inventory items, and a variety of other processes within EnterpriseIQ. The IQ Quality Management—Core System, which comes as a standard EnterpriseIQ offering features the following capabilities: document linking and tracking; management of non-conform/non-allocate inventory; lot tracking of raw materials and produced items; inventory inspection tracking during receiving and production; return material authorizations (RMA) to both customer and supplier; and return and rework/warranty tracking.

Other additions to EnterpriseIQ include

• More than thirty new reports throughout the entire system, such as payroll, accounts payable, and quality control
  
  
• A new customizable front-end of the CRM module that allows extended review into sales notes, calls, tasks, quotes, and support issues
  
  
• Improvements to the vendor analysis reports
  
  
• A new EDI report specifically for vendors of Ford Motor Co.
  
  
• An expansion of the reports and capabilities for companies with multicurrency use
  
  
• Enhanced sales order management capability within CRM.
  
  
• A preventative maintenance feature that tracks auxiliary equipment use against main machinery use to give a broader view of plant operations and maintenance issues.
  
  
• A new licensed module called FabTrack is a visual scheduling tool that supports dispatch-based scheduling. It provides significant benefits over finite scheduling allowing multiple processes that are comprised in a single operation to be prioritized, scheduled, or planned by machine, shift or operator. This should allow plant floors to be more efficient and track processes in real time.

European and Asian Expansion

EnterpriseIQ was introduced in Europe in September 2002 and was installed in some of the largest plastics manufacturing companies in the world, including Mikron and Ten Cate Plasticum. But, support and installations were limited to the Swedish, Benelux, and UK markets. However, in 2003 Plasticsgrid, IQMS’ European sales partner, which provides additional support for Scandinavian-based users, announced that it was opening an office in Hamburg, Germany. EnterpriseIQ has also been translated into German and localized to meet the demands of the German plastics processors.

In addition to this development in Germany, in 2003 IQMS opened its own European support office. Located in the Netherlands, the office has since been servicing accounts in Western Europe, where current users of EnterpriseIQ can receive multilingual help desk support via phone, e-mail, or fax. Fully backed by the corporate offices in the US, the Dutch office serves as the first point of contact for users and is staffed by full-time support personnel.

What’s more is that recently in February, IQMS announced an expansion to serve manufacturers throughout Asia. Its subsidiary, IQMS Asia, will develop the market, effect sales, and handle implementation and service for EnterpriseIQ customers. The first IQMS Asia office opened in Kaohsiung, Tawian, with a second planned for Shanghai, China in March, and a third planned for Hong Kong before the end of 2005. To aid in its venture, IQMS also introduced two language versions to serve manufacturers in Asia: EnterpriseIQ is available in Simplified Chinese for companies on the mainland, and Traditional Chinese for companies in Taiwan and portions of South Eastern China. These new language versions should allow manufacturers to connect operations in other countries with plants in China. At about the same time, IQMS has begun implementing EnterpriseIQ for the Shanghai operations for two new customers, Tessy Plastics, an Elbridge, New York-based (US) company, and for Mikron, a Swiss company. The vendor expects five more additional customers to come on board in the next twelve months.

IQMS User Base

The primary companies served by IQMS can be profiled as small and medium make to order (MTO) or make to stock (MTS) manufacturers that have repetitively engineered products and that value information flow that is in the closest to real-time as possible. Initially, IQMS focused on plastics processors, which entail injection and blow molding; extrusion; blown films; and thermoforming—all with subsequent assembly and related secondary operations. Lately, the vendor has also expanded within the automotive; consumer products; appliances; electronics; medical devices; aerospace; telecommunications; and packaging industries.

Though Oracle is the leading database worldwide (based on its revenue from the last five years); is quite secure; enables high performance levels; and is the enterprise applications platform of choice for the majority of Fortune 100 companies, it is not typically the choice of IQMS’ target market. IQMS’ target market is a few tiers lower and its prospective customers want a low cost and low maintenance ERP solution. While IQMS uses Oracle, market demand typically forces IQMS’ competitors to use Microsoft SQL Server, and possibly Progress, or IBM DB2 (for the IBM iSeries [formerly AS/400] operating system shops) database platforms.

However, IQMS argues that Oracle’s Application Specific license, which is the preconfigured version of the Oracle’s database management software, Enterprise Full Use license, is a low maintenance database. Both use the same core database engine and as an embedded part of EnterpriseIQ, the Application Specific license is Internet-enabled via Apache Server. Moreover, unlike its unconfigured counterpart, the Application Specific license does not require end users to develop entire applications from scratch.

Because the Oracle database is completely pre-configured by IQMS during the installation process, there is reportedly no Oracle programming required to run the EnterpriseIQ applications. Thus, the vendor cites that other than verifying system backups, occasional upgrades, and possible performance tuning (which is done in conjunction with IQMS technical staff), the Oracle end user has little need to work directly on the database. To further build a case for Oracle, IQMS conducted a survey of its users to determine their IT staffing requirements and how much time is required to administer the Oracle database. The survey, which can be obtained directly from the vendor upon request, substantiates the overwhelming response that the Oracle database requires minimal maintenance. In fact, most small to medium enterprises (SME) do not even require an IT person to maintain it.

Market Impact

IQMS (www.iqms.com), a privately-held company located in Paso Robles, California (US), has experienced a period of growth over the past few years when other companies have experienced decline. Its flagship product, EnterpriseIQ is one of the industry's leading enterprise resource planning (ERP) solutions for repetitive manufacturing environments, particularly suited for injection plastics molding/extruding and rubber industries. With its products, the company experienced a 12 percent growth globally in 2003 when 700 new licensed users reportedly joined its client base. Closing the year with a 15 percent increase in revenue, IQMS responded to this increase by expanded its US Midwest office, offering additional training and sales support to clients.

Part Two of IQMS Prospers by Helping Enterprises Work Smarter series

At first glance, IQMS resembles many of its peers from the lower-end of the enterprise applications market, not only in terms of its budding global presence, annual revenues, and install size figures, but also in terms of its industry-specific software that reduces implementation and training costs. For example, an average EnterpriseIQ implementation typically only takes between three and six months. However, despite the like corporate profile and product similarity, IQMS has a comprehensive, one-source delivery and service where all of its product development, training, implementation, and support are provided by its own employees, rather than third party providers. These employees are American Production & Inventory Control Society (APICS) certified and have extensive implementation and proven project management experience. They also have strong manufacturing and accounting backgrounds. This, in addition to its implementation methodology that balances on-site consulting, classroom training, and Internet-based training, are notable differentiating traits.

IQMS also has an upfront nature that makes it stand-out from its peers. Its maintenance contracts include all product upgrades and technical support, without any hidden costs. This, combined with IQMS’ great reputation for customer support, highlights the company’s open lines of communication. Customers are almost never put on hold or have to go through an annoyingly long automated process. Rather, calls are answered by a knowledgeable person, not a recording. The vendor happily lets anyone talk to any of its satisfied customers within selected industries of focus and that have had similar issues as the prospective customer. IQMS also proclaims its confidence by offering a one-year, money-back guarantee.

Still, although indisputably impressive, one could dig up similar value propositions from other players in the market. Also, on the surface, the product has many pedestrian functional and technological capabilities. For example, it has a Microsoft Windows-based platform for the client side and networks features familiar user-friendly interface with familiar navigation that involves easy jumps between tightly integrated modules and drill-down capabilities. The database resides on the server that performs operations on that data at the request of clients. Data is then transmitted over the network and users access the information from clients/workstations; ultimately, its a process that uses very little code. Furthermore, the front-end Delphi graphical interface allows users to manipulate or search for data, while Microsoft Terminal Server (MTS) and Citrix Metaframe clients are used for wide-area network (WAN) links.

EnerpriseIQ Modularity

The EnterpriseIQ system is also modular, with a broad core package, and many optional modules that extend the product’s functional scope. Consequently, the IQ Accounting & Financial Management modules include the “usual suspects” like general ledger (GL); accounts payable (AP); accounts receivable (AR); cash management (including disbursements, receipts, and cash analysis); budgeting; multiple currency capability; bank maintenance; customer and supplier status; standard costing; auto-invoicing; cost variance analysis; bank reconciliation; employee maintenance; tax code tracking; and so on. Another common feature is FRx Reporter, a powerful financial reporting system from FRx, a Microsoft company. The product, which has recently been re-branded as Microsoft Business Solutions Analytics (MBSA)—FRx, reads directly from EnterpriseIQ GL. With this feature, it is fairly easy to create and use customized financial reports, since the product was designed by accounting professionals for their peers. It has customizable formatting similar to Microsoft Excel, linking data from multiple sources with a drill-down viewer capability—from the summary level to underlying account and transactional detail. For more extensive information on the product, see FRx Poised To Permeate Many More General Ledgers.

Moving onto the IQ Sales & Distribution suite, one will also find many typical modules and capabilities, such as inventory availability, capable-to-promise (CTP), order entry, order tracking, shipping schedules, pick tickets, advanced shipping notices (ASN), bills of lading (BOL), packing slips, return material authorizations (RMAS), consignment inventory, freight maintenance, rework tracking, commissions, sales analysis, distribution centers, release management, customer specific sales pricing, tiered pricing, forecasting, and so on.

Linked with this suite is a native IQ CRM system, which also tackles some basic supplier relationship management (SRM) functions, and that features the Internet and a personal digital assistant-enabled contact management system. The product was devised to improve customer and supplier relations by tracking sales and marketing/procurement efforts and customer and supplier issues through, for example, notes, activities, follow up, alerts, etc. As a result, the product is workflow-enabled and provides customized alerts and scheduling, while its true integration with other EnterpriseIQ modules ensures centralized data management.

Likewise, the IQ Purchasing suite also seem to offer common capabilities like purchase orders, requisitions, material exceptions list, purchasing approvals, receiving, supplier management, supplier RMAS, 1099 contractors management, purchasing history, receiving inspection tracking, alternate purchase pricing, supplier performance analysis, supplier consignment inventory, and so on.

Differentiating IQMS’ product from its peers’ offerings, however, is the native IQWorkforce HR module. It enables employee benefit management and tracking, training and skill set management, application process management, and review and termination tracking. As with native CRM capabilities, the benefit of this module comes from consolidating information in a single database. The result is more reliable tracking of training in accordance with quality management standards; improved employee communications; centralized employee activity; and reduced management tracking activities. Moreover, the system also features a native payroll system that also centralizes employee activity. Automatic tax code updates, direct deposit, and electronic bank transactions are also supported.

All the reports and forms throughout EnterpriseIQ use Business Objects’ Crystal Reports, which are relatively affordable, easy to use, and fully customizable. Further, in addition to financial reports by FRx, IQMS’ partnership with CorVu provides the following analysis and executive information systems (EIS):

• CorManage—automates the user’s balanced scorecard, Six Sigma, total quality management (TQM) systems, and economic value added (EVA), which is the financial performance measure that comes closer than most other to capturing the true economic profit of an enterprise. It is most directly linked to the creation of shareholder wealth over time.
  
  
• CorBusiness—provides business intelligence (BI) management with end user online analytical processing (OLAP) analysis, interactive reporting, database queries, executive dashboards, and key performance indicator (KPI) alerts.
  
  
• RapidScorecard—provides administration and data entry facilities for the CorManage product by automating proverbial Kaplan and Norton's balanced scorecard systems.
  
  
• CorPortfolio—enables executives to fairly quickly review reports, analyses, and business commentary from virtually any data source, collating them into an electronic portfolio.

What Then Is Unique About IQMS?

Nevertheless, going beyond these common capabilities that are frequently met by many other competitive offerings, one will notice that IQMS is truly an interesting enterprise applications provider, almost bordering on an anomaly. For one, IQMS’ use of an Oracle database, which, despite the vendor’s sensible rationale to leverage it, remains atypical for the market segment it targets. Namely, we can only think of ICICI-Infotech (see ICICI-Infotech’s North American Strategy for Success) as another vendor comparable to IQMS that is also Oracle-centric, albeit ICICI-Infotech is focused on different industries. IFS, which, like IQMS, supports the Windows client/Oracle database combination, targets much larger companies than IQMS.

Another feature which demarcates IQMS from its peers is its focus on the unique needs of plastic processors and extruders. This is not a highly contested market by ERP providers; there are only a few vendors that have well-attuned offerings that cater to the market. One only needs to look at ones desk to see how ubiquitous the product is: telephones, staplers, monitors, computer housing, etc. all contain plastic. Plastics usually comes from converting raw resins to the molded form, which is then assembled as a final product, or shipped as is. Examples of "processed plastics" include extruded railings, frames, cables, etc. Because they cannot be disassembled and reused or stocked, they fall under the process manufacturing category, which is a manufacturing process focused on formulas, not BOM; ingredients, not discrete parts; bulk manufacturing, not pieces; and pack recipes, not packages. For more peculiarities of process manufacturing, see previously published TEC articles, such as Processing Manufacturing Software: A Primer, Process Manufacturing: Industry Specific Requirements and What Makes Process Process?.

EnterpriseIQ tackles both situations, although it uses a BOM to describe a "process". Namely, by changing units of measures (UOM) and the way the rate of production is displayed and calculated, the product supports a sort of a process formula. It also uses a different (though highly related) BOM for more standard, discrete manufacturing assemblies. Users can link a "process" BOM to an "assembly" BOM to create the final part. To illustrate, one could make the process portion first, temporarily store it in the warehouse, then later build and fill a custom container to the customer specifications. Thus, two BOMs, each with different core functionality, are tied together to deliver the final, end user component.

Moreover, as opposed to only being a planning or scheduling tool in terms of a machine or work center EnterpriseIQ is molding or extrusion die-based tool. Quotes aand BOMs support family tools, and there can be multiple alternative BOMs that make the same end item. Part costing and pricing can be done for individual items of family molds. It also supports standard and actual cavitation, which happens when some cavities within the mold are blocked. EnterpriseIQ overcomes this by creating complex tools, and the plant maintenance module tracks cycles on tools, dies, and even mold inserts.

From the scheduling perspective, the product highlights tools and dies grouping, creates visibility for out-of-service tools/dies, and evaluates any auxiliary equipment conflicts. From the raw materials vantage point, it can track regrind, (a waste material from molding and extrusion operations, which has been reclaimed by shredding or granulating), scrap, sprue (the main feed channel that connects the mold-filling orifice with the runners leading to each cavity gate; it is also the piece of plastic material formed in this channel) and runner (the secondary feed channel in an injection or transfer mold that runs from the inner end of the sprue or pot to the cavity gate) materials. It also has multiple ways to make or track material blends, an can perform the so-called “Runs-the-Best” tracking.

These plastic-specific capabilities all come in addition to the usual IQ Manufacturing & Shop Floor Planning modules, such as quoting/estimating; BOM; routings; inventory management; production/work orders; finite/infinite scheduling; master production scheduling (MPS); material/capacity requirements planning (MRP/CRP); labor capacity planning; machine capacity planning; production reporting; process/job costing; lot traceability; non-conform and non-allocated inventory management; quoting inventory; work centers; shop calendar; outsourcing/subcontracting; physical inventory/cycle counting; and inventory transaction log.

Fully-integrated Plant-level Solution

Superficially, there appears to be little to distinguish IQMS (www.iqms.com), a small, quiet, privately-held company, from other lower-end enterprise application competitors. Its global presence, annual revenue, profile, and even its products may appear to have features akin, if not alike to its competitors. However, along with targeting a niche market of repetitive manufacturing, particularly for the injection plastics molding/extruding and rubber industries, this Paso Robles, California (US) company has other notable features. In particular, what may be true distinguishing is that IQMS offers applications and services typically expected from much larger, tier one vendors—often going beyond. Namely, the product is so complete that it does not involve third-party products (other than some reporting facilities). Its natively-built features go beyond the customer relationship management (CRM) or HR/Payroll capabilities, which are often found in other products, but only as third party solutions that are embedded, standard configurations leaving customers oblivious to modules’ origins.

Part three of the IQMS Prospers by Helping Enterprises Work Smarter series

So how many other ERP vendors, including the largest ones, have natively built-in, real-time production monitoring, electronic data interchange (EDI), and complete quality management systems? Well, almost none when it comes to integrating ERP and manufacturing execution systems (MES). MES, as defined by the Manufacturing Enterprise Systems Association (MESA International) is essentially any system that uses current and accurate data, triggers, and reports on plant activities as events occur. From electronic production management systems to shop-floor data capture, an MES manages operations from the point-of-order-release to manufacturing, to point-of-product-delivery to finished goods. The potential of integrating and providing all elements of a complete manufacturing solution, at least from a same source, if not as a single computing platform, has always been tempting, and potentially lucrative. However, it has never been delivered, not even by the once mighty Invensys. The company that once had Baan, Marcam, Avantis, and Wonderware, and their respective ERP and MES products under its roof, never delivered the software together. (see The Name and Ownership Change Roulette Wheel for Marcam Stops at SSA Global—Part Three: Last-Ditch Effort by Invensys). For a detailed discussion of what integration means to manufacturers, see Manufacturer’s Nirvana—Real-Time Actionable Information.

Thus, IQMS might be unique, not only within its mid-market realm, but in the entire ERP arena. By providing the powerful IQ RealTime Production Monitoring module, it ensures plant efficiency by identifying poor machine performance before problems occur. The module provides automatic production tracking by wiring hardware directly to production machines. A special user touch screen to simplify data entry can be created for shop floor personnel to provide a virtually real-time data flow to and from the shop floor. Thus it brings production and ERP information together and informs both office and plant personnel about what is exactly happening on the plant floor through color-coded screens. For example, yellow would indicate that a machine is down, while green would mean it is in production.

Captured real-time information can include cycle times, machine efficiency, and scrap percentage. The machine operator can enter timely production; backflush raw materials; print labels; change cavitation as necessary and “on the fly”; assign labor; record rejects with user-defined codes; enter downtime with user-defined codes; and view internal or external documents. With this last example, part production, setup control, material staging, quality control, overall plant performance etc. can be seen. All of these information chunks increase data integrity and reduce transaction costs, given that complete access to ERP functionality automatically updates the production schedule and generates production reports. Without such a module, gathering actual production information is a time consuming, tedious, and highly subjective task. The reconciliation of the actual data on the floor with the planned data in ERP is often delayed for days, if not weeks, resulting in no actionable information.

Potential Benefits

There are multiple, potential benefits of intrinsic integration with ERP and the plant floor and gathering near real-time information. For one, such a system may transfer many data entry functions that are traditionally performed in the office directly to the manufacturing floor. As a result, material personnel can, for example, transact the issue of resin to and from machines on-line instead of turning in the material transfer paperwork to the office. Thus further delays are prevented. Additionally, the material can be classified as regrind immediately within the system, giving production planning a real-time inventory on the status of resin.

Production counts can also be automatically updated with the IQ RealTime Monitoring system and be verified by machine operators, giving supervisors constant feedback on how their shifts are performing. Production reports for completed jobs can then be generated and analyzed the day after the run is complete. In the past, this process typically would lag behind production by a few weeks.

All of this should bring the production floor and financial and planning departments closer together because they are working in concert instead of passing outdated paperwork back and forth. This could, in turn, encourage discussions on how to improve operations internally. Both teams will be able to communicate more openly and inform office staff when machines go down or if production is off target for a shift.

The system even offers touch screen time clock capabilities to input labor and automate timecards. Incidentally, the optional IQ Time & Attendance module is a broad time clock system that eliminates the need for a third-party time clock system that is typically implemented by ERP competitors—normally by partnering with the likes of Kronos. It also minimizes time required for labor data input.

The product generates payroll timecards or output file for external payroll systems (since native integration with the IQ Payroll module is available only in the US). It also generates more accurate job costing information by allowing labor tracking to specific tasks. The module provides links to labor reporting for production reporting or job costing in JobShopIQ, IQ Project manager, or IQ Preventive Maintenance modules, as required. IQ Time & Attendance also supports the visual scheduling of shifts and multiple devices for login, such as keyboard, “swipe” readers, and biometric scanners.

These illustrate the first great steps toward the manufacturer’s nirvana of making every batch a great batch, or, in the language of plastic processors, to “ensure shot-to-shot” and “run-to-run repeatability”. At the very least, terrible runs can be eliminated and the ranking of every run can be lifted, allowing for significant financial gain (for more details, see Process Manufacturers—Great Batch, Every Batch).

Cost Effective Warehouse Management System

Along similar lines is the wireless IQ Warehouse Management System (WMS) module that supports hand-held scanners, personal digital assistants (PDA), and radio frequency (RF) technology. Consequently it improves plant floor communications and lowers the cost of inventory data collection. This is done in conjunction with aiming for on-line updates in almost real-time (although this kind of functionality tends to be provided by many peer products, such as Made2Manage). The module handles a raft of inventory transactions such as receiving, manual adjustments, physical inventory, production entry or materials backflush, pick tickets, packing slips, etc. It also provides access to the information from IQ RealTime Production Monitoring like setup jobs, entered scrap, reported production, printed labels, or reported downtime codes. For automotive suppliers, another industry of interest for IQMS, the solution features a serialized inventory labeling system that is also Automotive Industry Action Group (AIAG) compliant.

Although these optional modules require additional shop floor user licensing and additional hardware, they are often a cost-effective production monitoring solution, allowing production information to be accessible from virtually anywhere. Accordingly, machine interface units (MIU) are mounted directly onto each machine control panel to capture and transfer machine cycle information to the machine monitoring unit (MMU). The data from each machine is collected through the RealTime Box and sent back to the Oracle database via an IQ RealTime workstation (a dedicated Microsoft Windows server). The capacity for each MMU is sixty-four machines.

For plastic shops requiring even more complex monitoring for molding, stamping, forming, extrusion, and assembly, there is the IQ Gate application programming interface (API). It is a gateway to Mattec Corporation’ equivalent solution, one of the leading process monitoring products in the industry. Information transferred to Mattec includes production schedules or work order information, item data, and BOM data. EnterpriseIQ, however, captures production data from Mattec, such as cycle information, downtime intervals, and scrap information. The API thereby cross-references or maps scrap and downtime codes between EnterpriseIQ and Mattec. Data is automatically transferred via the IQ Alert notification system and at user-defined intervals for data exchange.

The role this API plays gives us a flavor for what is required to interface just two disparate systems and getting them to “talk to one another”. This tedious job often falls into the IT department’s lap, perhaps with help from vendors. Interfaces typically resemble a batch file upload process, with data mapped between two different systems so each can understand the other. Data mapping almost always requires custom work and an unnecessary “reinvention of the wheel”, since the structure of the data is more or less always unique between the vendors’ products. The interface, once written and tested, is valid until a vendor changes something in the software as part of a product update. With new versioning, the immense customization effort and annoyance starts all over again.

While some larger complex enterprises may need a best-of-breed solution to flexibly extend their activities into e-collaboration, managing this large application portfolio—much of which involves partnering or extensive integration and customization—is cumbersome to say the least. While the best-of-breed approach can have its merits, (see Best of Breed Versus Fully Integrated Software: The Pros and Cons, Single Source or Best of Breed— The Debate Continues, and Pure-Play CRM Vendors: Choose an Integrated or Best of Breed Solution?), we believe it consistently leads to additional integration costs and complicates service and support arrangements. Interfaces between components like ERP, CRM, WMS, MES, or e-business usually require significant tailoring. This can be a barrier to future changes as modified code needs to be further revised which is notoriously time consuming, costly, and risky. Moreover, these concoctions can also have a different "look--and-feel" across the range. For a more detailed discussion see Integrated Solutions: Look before You Leap.

Furthermore, the enterprise applications market (EAI) market is still nascent and fragmented, burdened with difficulties despite the advent of service-oriented architectures (SOA) and Web services (see Leveraging Technology to Maintain a Competitive Edge during Tough Economic Times—A Panel Discussion Analyzed). These caveats speak to the complex nature of EAI software and the power struggles currently taking place in the market. To illustrate, there are indications of the existence of more than a dozen dialects of extensible markup language (XML). In short, the bad news about interfaces comes from the need for continuous management and upgrade coordination; an increase in IT support staff; multiple software company maintenance contracts; and complications with report writing. Moreover, one should beware of financial (in)stability that may plague software providers. All of the involved providers may have different, even diverging business strategies, further complicating the management of a client’s EAI.

On the contrary, a fully integrated extended-ERP product like EnterpriseIQ may completely eliminate all of these issues for small and medium manufacturing enterprises, especially ones with scarce IT skills. Namely, when the data is stored in the same database, there is no need to create and manage ungainly interfaces, because there is only one master application. Data visibility is inherent, since with the proper links, data can be gathered and disseminated in multiple ways, without delay.

Conversely, in most cases, multiple databases on the shop floor, like quality management data; production and warehousing real-time transactions; plant maintenance data; ERP master data, etc. are rarely in sync, making timely decision-making difficult and often inaccurate. This problem holds true any time information is kept in more than one location, since without a highly advanced method of synchronization, the chances of having accurate data stored in more than one location are small indeed.

If data is only synchronized on a batch mode basis daily, or even by shift, managers will still have difficulty making timely, accurate decisions. As a result all functions such as production planning, shipping, inventory control and purchasing, are impacted. Customer service is also handicapped as they attempt to serve customer requests for order status. In the worst cases, some data is never synchronized to the master ERP system and a serious communication void ensues. In the worst case scenario so-called “Islands of Automation” where various groups under the same roof, only concern themselves with their records and responsibilities, and never collaborate. In other words, the total environment is never addressed in a unified way.

Benefits of a Single Database Solution

Embedded third-party solutions in enterprise applications often deter small and medium enterprise (SME) customers. However, enterprise resource planning vendor, IQMS (www.iqms.com) has a value proposition that differentiates itself by gladly touting the benefits of a single database/single vendor software solution. Here, the one database rule creates ease of use, implementation, and maintenance, and real-time transactions because there are no unwieldy batch interfaces from third-party software. Reports also become easier to write in a cohesive environment.

EnterpriseIQ Information Flow

To illustrate, let us try to understand the typical flow of information through EnterpriseIQ. It may start with the creation of a bill of material (BOM), which defines how items are manufactured, and includes prescribed raw materials, tools, production times, packaging, work center types, instructions, etc. Then, the Quotation module allows users to examine costs and profit margins on new or existing manufacturing configurations. The structure is similar to that of BOM, but users can run unlimited “what-if” scenarios and, when satisfied, they can fairly easily roll over a satisfactory quote to a BOM without reentering the data.

Later, actual sales orders—which are the actual demand that consumes the forecasted, hypothetical demand—will drive the creation of work orders. If parts are already in inventory, they can be shipped immediately. If not, then a work order will be generated through the optional Update Schedule facility. This option analyzes both the demand and supply and then builds work orders that meet demand.

Then, the IQ RealTime Production Monitoring gives users a view of production as happens. The work-in-progress (WIP) information in EnterpriseIQ can be updated as often as every fifteen seconds, and users can see how long a machine has been running, its total cycles, or whether is has gone down during the run. Unnecessary down time can be reduced when job status is identified because operators can be alerted when to prepare material for the next order. Additionally, one can record any bad parts when they occur and the system will automatically recalculate the number of parts left to produce. Consequently, corrective decisions can be made regarding stopping and starting production runs based on the scrap.

In addition to determining quotes and monitoring, users can also automatically create production shift reports. The application fills in the data for total cycles, good parts, and production hours for the user, making both reporting and verification easier. The final step closes the manufacturing loop. Daily production of the work centers is documented and the subsequent reports tell EnterpriseIQ exactly what raw materials were consumed and what was manufactured. This puts finished goods into inventory and can backflush raw materials used to make those parts.

Because work orders are based on how BOMs are setup, precise and near real-time information is important to get work orders right. Also, inventory and open orders play a major role in determining what must be produced, purchased, and inventoried. The IQ Preventative Maintenance module can play a crucial role in this. It is an intrinsic part of the core EnterpriseIQ system that tracks machines, tools, auxiliary equipment, quality inspection gages, building maintenance, maintenance, repair, and overhaul (MRO) inventory, etc., and prevents reliance on schedules based on out of service machines and tools. The module also tracks maintenance intervals based on equipment usage, including the number of cycles on tools, hours or cycles on machines, or daily for other equipment. It also automatically generates work orders for maintenance where necessary, which can be preventive, repair, and emergency work orders. Moreover, IQ Preventative Maintenance has direct links to labor reporting, inventory, accounting, and purchasing applications, and provides up-to-date financial information on maintenance work.

Also helping to achieve real-time information is IQ WebDirect, a Web-based customer and supplier self-service portal technology, which enhances supply chain communications, improves customer and supplier relations, and reduces customer and supplier service costs. It runs on an Apache server (included) with an Oracle database (although IQMS recommends a separate Web server it there are more than five concurrent users of the module). WebDirect also has full security control features and allows 24x7 access to data. The portal allows customers to add, edit, or change orders; to check order status, inventory availability, shipments, invoicing, vendor managed inventory (VMI) entry (based on flexible rules), and to publish reports. On the other hand, suppliers can check purchase order information, inventory, receiving, invoicing, cash payments, and published reports. Similar portal solutions for the user enterprise’s internal employees are still in the works, though.

Quality Management to Boot

The competitive bar for single-database software solutions and seamless ERP system access, may also be raised by IQMS with its vast, native, IQ Quality Management suite. IQ Quality Management adheres to the most stringent quality requirements including medical, automotive, International Standards Organization (ISO), and QS standards by International Automotive Sector Group (IASG). IASG is an international ad hoc working group consisting of automotive original equipment manufacturer (OEM) representatives, accreditation bodies, registrars, and suppliers. To accommodate the quality management processes of their customers (whether as a part of the lean manufacturing initiative or not), most other ERP vendors have to team with the likes of Powerway, Pilgrim Software, Qualiware, or other niche providers of quality management software for the manufacturing industry. They must ensure that these providers comply with the widely established QS-9000 quality system requirements, including Advanced Product Quality Planning (APQP) and its obligatory Products Part Approval Process (PPAP).

With the standard EnterpriseIQ system configuration, users should be able to automate paper-intensive revision processes with the Document Control module. Employees should be able to gain real-time visibility into the key documents so that the right people can view the right documents as changes occur. The module also stores documents in secure libraries allowing for secure document control throughout the enterprise. Documents can be linked and viewed throughout EnterpriseIQ, which can also automatically keep revisions for future access.

The module uses the EnterpriseIQ Workflow facility with Web- and e-mail-based collaboration, routing, and approval process, and has support for personnel outside the user enterprise. It alerts team members about issues requiring attention via e-mail notifications that contain hyperlinks to the document. Information on changes and approvals are also included. The underlying security mechanism tracks edits, notes, and even ideas through authorizations and authentication. The processes are managed by “team members” responsible for approving or reviewing changes and additions to the documents. Approvals can be handled sequentially or as a group, where all members receive notification simultaneously.

IQMS also offers a higher level of quality functionality. The corrective actions requests (CAR) module, which is linked to return material authorizations (RMA) and inventory locations, manages, schedules, assigns, and monitors the status of corrective actions for process, product, or system audits. It is customizable with user-definable formats, including pertinent 8D and 7D formats as the standard. It also has user-definable drop downs for quick adding, sorting, and tracking of information. Further, the engineering change orders (ECO) module is linked to part numbers and BOMs and monitors changes associated with BOMs and routings. It provides specific templates for tracking ECOs and can automatically update BOMs based on user-defined effectivity dates, with costing comparisons for future and current BOMs. These quality modules use EnterpriseIQ Workflow for Web-based approval processes giving easy access to remote suppliers, customers, and employees.

Useful For Repetitive Manufacturers

Last but not least, the highest optional level of the quality management system should especially help repetitive manufacturers to reduce scrap, rework, variations, and defects. Accordingly, the first module involved in this process is the Statistical Process Control (SPC) module that uses quality management tools to collect, manage, and analyze an organization’s gauge and machine data to identify out-of-tolerance processes. This process is fairly quick and allows users to automate time-intensive data entry through real-time integration with their gauges and machines. The module delivers SPC data analysis with graphing and export capabilities by supporting gage selection and maintenance, part dimension maintenance, and the manual or automatic input of data from serial and universal serial bus-based (USB) devices, such as scales and calipers. Sample set sizes are user-defined and can be changed between subgroups, while output and analysis options include full access to historical data collection used for free-form reporting. The system also has ample data export capabilities that include histograms, and capability analysis. It also provides for X-bar, which is a control chart where the subgroup average (X-bar) is used to evaluate the stability of the process level; and R charting, a control chart where the subgroup range, R, is used to evaluate the stability of the variability within a process.

Further, with the Gage and Device module one can track and maintain gages and devices. Users can also access and maintain their repeatability and reproducibility (R & R) studies to identify and reduce measurement variation, capability studies, set up instructions, schedule calibrations and so on. In other words, R & R provides tools to conduct measurement system analysis to assess the accuracy of gages and operators in measuring dimensions. With this timely information, one can thereby reduce data entry efforts and identify sub-standard quality much earlier and keep customers happy. The module also has a direct link to the IQ Preventative Maintenance module.

To create visibility at the component level in quality processes, users can use the APQP module with integrated templates for automotive requirements. These requirements are based on the Ford and General Motors’ APQP programs, and should tremendously help users link and manage APQP-process related component-level documents. For example, a user can design according to the Failure Modes and Effects Analysis (FMEA) methodology and analyze potential reliability problems early in the development cycle. Because it is easier to take actions and overcome issues early in the cycle, users can enhance reliability through design. FMEA is used to identify potential failure modes, determine their effect on the operation of the product, and identify actions to mitigate failure. A crucial step is anticipating what might go wrong with a product. While anticipating every failure mode is not possible, the development team should formulate as extensive a list as possible of potential failure modes.

Other pertinent documents include control plans, operator instructions, APQP checklists, and action plans. There are also user-definable steps to allow companies to customize the program based on their needs and requirements. User-definable drop-down menus for quick adding, sorting, and tracking of information are also available. Like many other quality modules, this one uses EnterpriseIQ Workflow to track the information required for process documentation and definition. It has direct links to inventory items, part dimensions, routings, etc.

Finally, the PPAP module provides tools for planning and controlling part production information, including the ability to outline the sampling process, provide checkpoints for adherence to plans, and ensure a process has the potential to consistently manufacture products that meet or exceed customer quality requirements. The module is directly linked to inventory items, and customer information. It also has a built-in control plan, FMEA management, and reporting facilities, while the Quick Inspections facility provides fast, easy, and accurate data entry.

The Pain and Gain of Integrated EDI

IQMS, a small, privately-held company operating out of Paso Robles, California (US) has marked itself differently from other enterprise resource planning (ERP) vendors by offering native modules where other vendors only provide third-party solutions. Generally, embedded third-party solutions are leerily regarded, especially by small and medium enterprises because third-party batch interfaces tend to be cumbersome. IQMs’ use of native modules is, therefore, a welcome achievement.

Part Five of the IQMS Prospers by Helping Enterprises Work Smarter series.

However, while its native modules provide a “single view of the truth”, there is more to this best-of-breed versus integrated suite dilemma than data synchronization. Being electronic data interchange (EDI) capable has, for some high-volume industries like automotive suppliers, become a required, though far from pleasant task. It is made even more dangerous with the amount of work needed to ensure that incoming and outgoing messages are handled accurately. EDI solutions from traditional value-added network (VAN) providers like GXS, Sterling Commerce, or Inovis provide the fundamental translation process, converting incoming files, such as schedule releases and forecasts, into something readable and understandable. Simultaneously, it converts outbound data, like invoices and ASNs into acceptable formats for receipt by the supplier.

Still, this readable data is only partly good for ERP systems, since the real action is in merging the new data with existing information that is already being processed within the ERP system. The ensuing challenge is to make sense of the daily, constant flood of EDI messages. In high volume environments, this can consist of hundreds of records affecting the releases and forecasts of hundreds of parts. It becomes infeasible to manually enter this data into the system, and therefore, an additional interface must be developed and tested. Yet, unlike an interface that updates or synchronizes inventory levels or product quality information, this interface has to do more than statically map data. It typically involves the extensive use of business rules and logic established between every customer and supplier. That is to say, the highly personal nature of the data means that no two interfaces are exactly alike, further complicating the matter.

Thus, resources must be extensively used on both sides of the table—the enterprise software vendor supplying the interface must write and test custom code, and the user must test and re-test thoroughly until the interface is working consistently. This is taxing not to mention expensive, especially for SMEs with limited IT staff and resources. However, with an intrinsic EDI system within an ERP product, the third-party software costs are virtually non-existent. Moreover, the time it takes to build the custom interface is drastically reduced, since those building the interface are working from within the ERP system, and have inherent knowledge of data structures and business logic.

Consequently it is amazing that the small ERP vendor, IQMS, such a module. Its native IQ EDI module supports ANSI X12, EDIFACT, and Odette file formats. Taking into account the importance of emerging technologies (see EDI versus XML—Woorking in Tandem Rather Than Competing?), IQ EDI is XML-enabled and supports file transfer protocol (FTP) for the transmission and receipt of files. The system generates and processes virtually all commonly required transaction sets. For inbound X12 format, and DELFOR (a delivery schedule message from a buyer to a supplier about product requirements) and DELJIT (delivery just-in-time message which relays the precise delivery sequence of a JIT schedule) EDIFACT transactions, the system supports remittance advice (820); planning/release schedule (830); purchase orders (850); change orders (860); shipping schedule (862); order status report (870); receiving advice (861); functional acknowledgement (997); cash application (824); and text message (864). For outbound transactions, it supports invoicing (810); planning/release schedule (830); shipments (ASN) (856); order acknowledgement (855); and vendor shipping schedule (865). Functional acknowledgement (997) for X12 and DESADV (dispatch advice message)—a message specifying details for goods dispatched or ready for dispatch under agreed conditions—is also supported.

Further, due to inherent integration with the rest of the EnterpriseIQ ERP suite, outbound transactions are sent directly from the system, that also includes template-mapping tools. Moreover, the need for third-party translators—which are a default for the vast majority of ERP systems requiring third-party EDI solutions—is eliminated. Demonstrating its industry savvy, the suite is based on the AIAG supply chain business practices and a number of flexibility business rules generate exceptions. For example, flags and reports can be sent when there are dramatic quantity changes in EDI transactions or to identify when user-defined limits (set either as a range or a percent) on quantity increase or decrease has been hit. Logically, the orders that comply with the rules are passed through to the sales module, while the orders that do not comply, get flagged.

Finally, rules can be setup either for each EDI transaction code number or for each customer. IQ EDI is an integrated component within EntepriseEQ, supporting the capability to translate files that are downloaded directly from a Web site or through the traditional EDI mailbox setup with a VAN provider. One should note, however, that IQMS does not provide communication nor maintain the mailbox. This is one instance where a third-party communications system (i.e., VAN) is required to perform this service.

Nonetheless, adding to its list of EDI accomplishments, IQMS successfully completed the EDI certification process for Honda North America, whose extensive testing and certification process ensures that suppliers meet the automaker's exact specifications for JIT manufacturing with seamless communication and data integration. To that end, IQMS completed the multistep test procedure with its EnterpriseIQ ERP software in less than six months, finishing in November.

Miscellaneous Utilities

In addition to the IQ EDI, EnterpriseIQ also offers a number of useful utilities, such as the IQAlert notification system, with many nifty business activity monitoring (BAM) features (see Business Activity Monitoring— Watching the Store for You). For example, appropriate persons are alerted of low inventory levels, missed shipments, late or pending purchase order receipts or other burning issues. It can also schedule unsupervised tasks like running an MRP engine, EDI processing, or creating database backups late at night.

Another notable utility is IQ Enterprise Plant for multiple facilities or companies. EnterpriseIQ provides extensive interplant capabilities for complex organizations throughout all modules. Accordingly, this allows multiple plants or companies to use a single database to centralize data storage, and administration and reduce redundant activity across multiple sites. That is to say, multiple divisions can exist in a single company, and multiple companies can exist in a single business entity, whereby each division contains its own BOMs, tools and dies, inventory, cost, supply, schedules, and production records. This allows for multiple facility and distributed manufacturing, because sales and purchasing operations can be centralized and de-centralized concurrently, while forecasting, master scheduling, and MRP can function separately for each division (or across divisions) for interplant requirements.

Users can view location-specific or plant-wide information, while financial statements will then show the financial condition of each company, as well as any combination of companies within the business entity, since interplant transfers are streamlined with the GL rollup. From a technology side, the system uses Windows Terminal Server (with Citrix Metaframe) operating across wide area network (WAN).

Other utilities worth mentioning include the e-mail capability, label generation and printing, internal/external document linking, data export capability, user defined fields/forms, the UPS shipping link, an underlying security system, detailed transaction log, external file import capability, external payroll interfaces, and so on.

More about Repetitive versus Project-based Requirements

Although IQMS focuses on repetitive environments, there are some basic job shop and simple project capabilities JobShopIQ and Project Manager modules have that help create, track, and manage discrete manufacturing projects from quote creation through work order completion. For example, it can track a special sales order for a special tooling. Accordingly, these modules feature manufacturing resource planning (MRP) and scheduling capability with exception requirements, multiple level tasking with financial rollup for task-by-task detail tracking and up-to-date project-based financials. They also have direct links to labor reporting, inventory, preventative maintenance, accounting and purchasing.

Still, EnterpriseIQ has been largely amenable to repetitive, volume-based manufacturing environments that rely on the movement of materials either through functionally-oriented work centers or product-oriented production lines, and are designed to maximize efficiencies and lower unit cost by producing products in large lots. Standard products with similar routings are therefore made by using virtually the same process, while production is planned, scheduled, and managed to meet a combination of actual sales orders and forecast demand. As a result, production orders stemming from the MPS and MRP planned orders are "pushed" out to the factory floor and into stock. External suppliers also work to support planned production, while materials management often relies on maintaining sufficient inventory, using a make-to-stock (MTS) as well as a make-to-order (MTO) or occasionally with the assemble-to-order (ATO) approach of keeping standard items or sub-assemblies in stock.

In these manufacturing environments, the time and cost of changeover to produce different products is high, as are the costs of inventory, planning, and expediting. The focus is thus on the efficient scheduling of production lines rather than on managing individual orders. Minimal necessary reporting points are also used to determine average or standard costs, and occasionally standard cost variances. Consequently, goods are pushed through production at levels determined by (often inaccurate) scheduling and forecasting tools common in MRP/ERP systems. These levels then often exceed demand, resulting in building excess finished inventory. In a flow/lean/JIT environment, orders are pulled through the process based on actual demand, which may alleviate the above inventory conundrum (see Pull versus Push: a Discussion of Lean, JIT, Flow, and Traditional MRP). Also typical of repetitive environments is the purchase of material for inventory and the issue of material for work-in-process (WIP). When manufacturing is complete, the finished goods are moved from WIP to the finished goods inventory before the shipment to the customer.

Further, although prior to any manufacturing, there is extensive work in the product definition phase (such as estimation, design, and engineering) before anything can be made or bought/delivered. The major difference is that within complex engineer-to-order (ETO) or project-based companies, the product design is an integral part of production, and at times, even continues during the site installation and commissioning. In the case of repetitive, standard items, the design is typically completed and handed “over the wall” to manufacturing well before the production starts. Therefore, in volume manufacturing the product definition work will be amortized (recovered) over the items’ life cycles, which are often measured in thousands of items and over several years of commercial use.

Whilst a time overruns can potentially effect the product’s time-to-market, which is often a competitive advantage (strategy) and lowers costs for repetitive manufacturers, the overrun has no effect on the overall lead-time of any particular sales, job, or project order. Thus it is not handled in the same way. Moreover, the extensive costs of product definition are absorbed into the company overhead or standard product costing, so that an overrun of costs can be managed in the context of a long term pricing strategy.

In the rigid systems of repetitive manufacturing, implementing a change to a bill of materials (BOM) or routing requires canceling all the effected open, closed, and in-progress orders and re-creating them with the new information. This in itself can create countless hours in administering the ERP system. Changes are handled differently in the case of project manufacturing, in terms of deep, multilevel ETO BOMs versus flat BOMs for repetitive items. However, by no means does this imply that in repetitive manufacturing planning and re-planning are simple activities, given one has to take the maximum or optimal utilization of plant, equipment and absorption of overheads into account. Both have their complexities.

Challenges

Despite its indisputably astute offering for a few selected high-volume industries, and its growth and expansion over the past few years of economic uncertainty, IQMS is not without challenges. For one, while this privately-held Paso Robles, California (US) company is focused to keep pace with trends in technology and customer requirements in its target niche, too narrow a focus comes with its liabilities.

Part Six of the IQMS Prospers by Helping Enterprises Work Smarter series.

IQMS’ irrefutably small size may create a perception of negative viability when many believe “bigger is the better”. On one hand, the time for comfortable stealth selling through word-of-mouth is running out, and IQMS has to find greener pastures in order to grow and be able to enhance its offering. The North American and European plastic processors markets are slowly, but surely becoming saturated. While there are few suitable products beside EnterpriseIQ, there are competitors including DTR International’s TMM (now part of Made2Manage Systems), SYSPRO, and Matrikon.

The realities of plastic manufactures can present challenges for IQMS. The products of plastic manufacturers tend to be high-volume, labor intensive and manufacturers do not have huge expenditure for research and development (R&D). Moreover, they are in a great part under pressure to supply giant, heavy-handed retailers like Wal-Mart or Target with ever cheaper goods, and do so by exploiting opening manufacturing facilities in remote geographic regions with much cheaper labor. Given all of this, IQMS should make sure that its product is fit for serving these markets too. Some of its domestic customers have already shifted markets and introduced new products. They have also honed their use of plastics molding technology and automation by adopting a so-called triad plan for positioning, where productive capacity is divided in diverse global regions based on several factors, but particularly according to high, moderate, and low labor cost regions.

Yet, penetrating blossoming markets like China will be difficult because of limited financial resources, nascent distributor relationships, and low visibility and brand recognition. IQMS might likely lose some deals because of its current inability to support prospects in many remote markets; its recent forays in Asia notwithstanding. Yet, it remains a good practice for manufacturers that are selecting solutions to factor in costs, the financial viability of the vendor, local support, and many other criteria even if it may not favor IQMS at this stage, despite its superior functional offering.

Can One Product Work for Large and Small Manufacturers?

IQMS has made notable strides into tier one and tier two automotive suppliers and appliance manufacturing sectors by leveraging its functional capabilities to garner a number of germane functional nuggets for these sectors, in part through the AIAG membership. For example, integrated electronic data interchange (EDI) (including XML), serialized label generation, customer, and supplier release control management and cumulative order tracking, just-in-time (JIT) production traits, and specific shipping requirements, including container management, pool/master bills of lading, and integrated communications such as XML. Its offering of QS-9000 tools with integrated preventive maintenance, document management and quality tracking and reporting, and others will also be welcomed by the automotive suppliers.

In addition to these, appliance manufacturers will appreciate consignment inventory management including remote location visibility via Web-based tools, including stocking level management and invoicing on consumption, and usage reporting. Still, in these sectors, IQMS does not have the status of “incumbent” as it does in the plastics, and will face fierce competition from a slew of competitors of all sizes with much higher visibility, global presence, and resources. Its mid-market competitors include QAD, Infor Global Solutions, MAPICS, Intuitive Manufacturing Systems, Microsoft Business Solutions, Epicor, and SSA Global.

IQMS’ total reliance on the Oracle database and its exclusion of all other databases presents prospects with another dilemma. Typically, discerning customers expect and like comparative choices. Likewise some companies of IQMS’ target market will have already made a significant investment in Microsoft technology and will be reluctant to bring in a new database design. Although IQMS mitigates this problem by providing a single and total source of implementation and as part of the standard, and ongoing maintenance agreement, will be responsible for support services, user perceptions and often religious-like attraction to certain technologies cannot be ignored.

Thus IQMS may have an “identity crisis.” By targeting smaller enterprises with technologies and a well-rounded product, will, in an odd way, label IQMS with being “too much of a good thing” because its product appears more amenable to the upper-end of the market. Namely, the tight integrated nature of the EnterpriseIQ and its high interdependence between modules, which cannot be that easily decoupled or turned on or off might be too overwhelming for some prospects that might not need many of the core EnterpriseIQ modules.

Also, given that some transactions within the system are not easily reversible after a user has made an error (a second transaction at a later date might be necessary to clean things up), the training and proficiency of users becomes critical. This might be a deterring factor despite its relative ease of use and the favorable ratio of software license fees versus implementation costs of 2:1. This may also mean that the IQMS’ user-based license fee is not aggressively priced, as the vendor does not want to undersell its powerful capabilities. IQMS does, however, take full advantage of the built-in Oracle database rollback features, which ensures that a power failure or something catastrophic does not leave rogue entries in the database tables, if the transaction could not be completed.

For reasons of simplicity, some prospects may prefer a less functional and less tightly integrated product. They may reach for a more flexible and customizable competitive solution on the more familiar Microsoft technology—particularly if the solution has stronger multinational capabilities. Also, many global prospects still have notable mixed-mode manufacturing environments in addition to their geographically dispersed plants that handle a significant number of complex products and require certain, non-repetitive job shop/ETO manufacturing and inventory management functionalities. Here, IQMS may not be nearly as competitive as in clear-cut repetitive environments.

Furthermore, often, buying a completely integrated solution is not an option when companies have either an accounting or project-management system at a plant, which they will not simply rip-and-replace. Thus, prospects might prod IQMS’ flexibility to integrate into legacy and other third-party applications, and how it keeps up with new versions or upgrades to both solutions. This may not be the vendor’s forte, given it best performs when dealing within the EnterpriseIQ’s Oracle-based domain. IQMS thus has to “beef up” and become more flexible or it has to better advertise its product’s interconnectivity, employee-facing portal solutions, supply chain execution (SCE), and e-collaboration and product lifecycle management (PLM) offering. While a comprehensive PLM strategy (see The Many Faces of PLM) might be a tall order for IQMS to deliver on its own, its sporadic projects integrating EnterpriseIQ with the product data management (PDM) providers should be parlayed into more strategic alliances.

User Recommendations

IQMS might be showing us that functionality is not exactly unimportant, but that it needs to be combined with a fairly simple-to-use application that actually gets used rather than languishes on the shelf. EnterpriseIQ is best suited for plastics processors, but a number of its extended-ERP features, such as its wireless WMS, EDI-XML, real-time production monitoring, quality systems, plant maintenance, etc. make it amenable to other repetitive manufacturing environments. Potential IQMS customers within the geographies the vendor covers, whether single plant or with multiple divisions with less than $100 million (USD) in revenues per location include the following discrete manufacturing industries: automotive, consumer products, appliances, electronics, medical devices, packaging, etc. Such companies should certainly consider IQMS’ offered product line, bearing in mind what the competitors have to offer. IQMS should certainly be evaluated to raise the bar for other vendors’ offerings in the selection process in terms of demonstrating how solutions manage the many aspects of high-volume, repetitive manufacturing, such as real-time production monitoring, graphical scheduling, the ability to account for family tooling capabilities, track scrap, etc.

On a more general note, companies that are repetitive manufacturers should think carefully when selecting an ERP system. Given the maturity of the ERP market, its ongoing consolidation, and the fact that competitive advantage is hard enough for manufacturers to find, they should not compromise on their requirements. Small and medium enterprises should especially ask hard questions about the scope of an ERP system, and how it supports high-volume idiosyncrasies. The less time they spend interfacing their ERP system with other relevant software systems such as quality systems, preventive maintenance, document, and workflow management, the happier they should be. After all, a new system should always be about improving the business and not a mere technology initiative.

The vendor that listens to your needs instead of telling you what “cool things” its software can or cannot do, one that speaks your language and uses your terminology and vernacular (e.g., cavity, family tool, a cycle time in seconds, a product weight in grams, etc. for plastic processors) is a good candidate to be a vendor that understands your business. Still, as a sort of a litmus test, prod each vendor to tell you what percentage of its sales would belong to your industry. Vertical focus indicates that software contains industry-specific features and that ERP vendors have certain industry expertise.

Also, in implementing an industry-specific application, it is important to ensure that the application provider’s implementation team includes members with in-depth knowledge and experience in that industry. Vendors geared toward certain industries should have solid integration skills or strong relationships with systems integrators that have industry-related expertise. This should significantly streamline implementation time by eliminating a lengthy vendor or integrator learning curve.