Logicalis helps ERP software maker IFS compete in today’s marketplace with cloud hosting and IaaS.
IFS develops, supplies and implements IFS ApplicationsTM, a component-based extended enterprise suite. IFS focuses on industries where management of any of the following core processes is strategic: service & asset, manufacturing, supply chain and projects. The company has 2,000 customers and is present in more than 60 countries with 2,800 employees worldwide.
A corporate strategy of focusing on enterprise customers enabled rapid international expansion since the founding of IFS in 1983. As an Independent Software Vendor (ISV), IFS had always used a perpetual license model to sell its software, leaving its customers responsible for purchasing, managing and updating the IT infrastructure needed to run IFS software.
In 2012, with the advent of cloud infrastructure and SaaS offerings disrupting the market, the company’s North American division found the need to add hosting and software as a service (SaaS) offerings to their portfolios.
Changing Customer Needs
There was a growing realization within IFS management that, while its end customers have traditionally implemented their enterprise solutions on premises, there was an interest in looking at lower cost ways of doing business, and outsourcing some of that IT support. “Customers and prospects were telling us they liked our software, but they didn’t have the bandwidth to run it on premises,” says Rick Veague, Chief Technical Officer for IFS North America.
Recognizing the need to quickly address changing customer requirements, IFS decided to seek an enterprise cloud hosting partner. Even though the need for help with cloud hosting was clear, finding the right solution proved to be difficult. “While it’s easy to get some cheap compute cycles in the cloud, it was challenging to find a cloud hosting provider that understood the nature of implementing and supporting enterprise-class applications,” Veague says.
Another facet of the challenge was that IFS would now need to provide a seamless experience to its customers, supporting them not only from an applications level but also from a cloud infrastructure level.
With increasing demand from end customers and sales staff for a cloud solution, Veague knew that urgent action was needed. Determined to achieve the best possible outcome, he set out to survey a broad sampling of cloud providers.
Enterprise-Class Cloud Hosting
“We were looking for enterprise-class hosting capabilities at an affordable price point, and something that worked with our business model,” Veague explains. IFS evaluated a number of the larger and smaller cloud services players, including Logicalis. In the end, IFS felt that Logicalis offered the best overall alignment to their own and their customers’ needs.
“Logicalis provides a cloud-based infrastructure management solution we can offer to our customers that is competitive in the marketplace,” Veague says. “At the same time, we’ve gained the ability to offer customized solutions to customers with unique challenges.”
Logicalis supplies the backend infrastructure, processes and resources required for end customers to run ERP application software developed and installed by IFS. Unlike most “pay as you go” infrastructure as a service (IaaS) offerings, the Logicalis Enterprise Cloud has the capacity to run mission-critical workloads. The Logicalis cloud offering is designed to support customers that need a long-term IT infrastructure service.
“Logicalis provides not only an enterprise IaaS infrastructure, but managed services to support the virtual servers running in the cloud,” says Sandy Shute, Logicalis Account Executive.
“Now, we have a compelling story when we get into a discussion that compares our solution with our competitors,” Veague says. “We can point to the differences between a professionally managed enterprise environment versus a collection of virtual machines on the Internet-in terms of risk, security, flexibility and business continuity.”
IFS can deploy Logicalis’ cloud-based solutions rapidly, responding to customer needs with an operationally ready solution. “Being able to offer cloud hosting and managed services gives our customers the choice between owning and managing their own IT infrastructure on premises, or having us handle all of that in the cloud,” Veague says. “For us, it’s turned out to be a great way to enhance customer satisfaction and loyalty.”
Interestingly, on at least two occasions so far, IFS prospects said they wanted a conventional on-premises deployment, but needed to get started before they could be ready with their own infrastructure. With the help of Logicalis, IFS provided cloud-based deployment as an interim solution. “After they tried it for a while, both customers liked having cloud-based systems and services so much that they decided to just stay there rather than bring it back in house,” Veague notes. “It was just a lot easier than doing it themselves.”
Professionally Managed Environment
Veague is emphatic that the professional management provided by Logicalis and seamlessly available to IFS customers is critical to the success of enterprise cloud hosting. “Having access to Logicalis solution architects and other experts is quite different than buying Internet-based services where you don’t pay very much and you don’t get very much,” Veague observes.
Logicalis has impressed IFS with the flexibility it shows when putting together customized solutions. In one instance, an IFS customer had very particular security concerns that required some unusual configurations. IFS and Logicalis were able to collaboratively work together and solve that issue with a customized solution designed to meet that one customer’s specific needs. “Many of our customers have unique requirements that require one-off solutions,” Veague explains. “Logicalis is very agile when putting those solutions together.”
IFS also finds it easy to plan and execute cloud- based implementations with Logicalis. According to Veague, some IFS staff had to come to an understanding of precisely how cloud services could best be made to work for IFS customers, what drives costs and how configurations work. However, once IFS got past that, the actual provisioning process has been quite simple. “If we bring a new prospect on board, it’s easy to give them a cost estimate, to fine tune that into a deployable plan, and then within some number of days the implementation is ready to go,” Veague notes.
“Going forward,” he says, “IFS will be restructuring how we propose our services to offer additional cost savings for customers who choose to deploy in the cloud.” Efficiencies gained by working with Logicalis make it more cost effective for IFS services teams to deploy in the cloud than to a customer on premises. “Now, as consultants, IFS can sell ongoing maintenance and additional services to support its software,” Shute adds.
In the end, Veague thinks the benefits of working with Logicalis come down to a few simple points. “Between IFS and Logicalis, we provide a 24x7 professionally managed environment, which many of our customers don’t wish to maintain in house due to the cost,” Veague says. “And, the risk of losing servers, data and business continuity is greatly reduced, because it’s in a professionally managed, audited, secure, hosted facility managed with ITIL processes, and backed up by a service level agreement.”
IFS offers customers the opportunity to deploy its ERP systems, IFS Applications, on premises, in the cloud or as a hybrid -- on premises and cloud. With IFS Applications, customers can deploy one of two ways. Customers can deploy IFS Applications as an infrastructure as a service model, where servers, storage and other infrastructure components are hosted on Azure, and the client accesses and manages these resources virtually. Or, clients can deploy as cloud ERP software, where IFS offers full management in the cloud through IFS Managed Cloud.
IFS primarily implements its ERP applications (as well as its enterprise asset management and enterprise service management software) at medium and large-sized companies in industry verticals like aerospace and defense; automobiles; and asset-intensive industries, such as mining, high-tech manufacturing, oil and gas, construction, industrial manufacturing, process engineering, and retail and service providers.
The core modules of IFS Applications
IFS Applications is a full-fledged ERP system. It contains modules for finance, HR, engineering, project management, manufacturing, inventory management, customer relationship management (CRM) and logistics.
The finance module includes tools, such as a general ledger, that help manage accounts payable and receivable, budgeting and cash flow. Demand forecasting, site planning, inventory replenishment, distribution, warehousing and procurement are performed through the supply chain management tool. The maintenance module gives enterprises information on maintenance and repairs on equipment and vehicles, and creates work orders.
IFS Applications helps enterprises manage the human aspect of business, too. An HR module includes training, employee management, payroll administration, performance review and attendance functions. On the external side of the business, a CRM tool provides enterprises with a sales configurator, e-commerce platform and case management functions.
With its engineering module, IFS Applications clients receive product data management and engineering change management tools. To ensure tight production schedules and budgets, enterprises can utilize the project management tool inside the IFS cloud ERP suite. The manufacturing module includes systems for both make-to-order and repetitive manufacturing.
IFS Applications is also supplemented with mobile apps, role-based portals and collaboration tools.
How IFS Applications works as cloud ERP software
IFS' cloud ERP software can be accessed via a web browser such as Chrome, Safari or Internet Explorer. Each client's unique copy of application software is accessed remotely by the client through secure network connections, such as Secure Sockets Layer (HTTPS) communication, private site-to-site VPN or MPLS connection.
IFS Applications 9 is the latest version of the ERP system. IFS releases service packs as needed -- usually every three months -- and these can include new features and additional functionality. Major version updates -- e.g., from IFS Applications 8 to IFS Applications 9 -- normally occur every three years.
IFS partners with Microsoft to offer single-tenant IFS Cloud on Microsoft Azure. IFS does not have its own data centers. Instead, it uses Microsoft Azure and the Azure network of data centers around the world. As such, Microsoft undertakes regular audits and is compliant with international security and data protection standards, including the SSAE 16 (SOC I Type II), PCI DSS and ISO 27001 audits. IFS undertakes technical audits on a monthly basis. On request, these audits can be provided to customers.
IFS clients receive service-level agreements, which contain a 99.5% internet connectivity guarantee. As part of its audit process, IFS regularly tests for disaster recovery and failover on Microsoft Azure.
Client support for IFS Applications
Every 18 months, IFS holds the IFS World Conference, which gathers customers, prospects, business partners and its other ERP ecosystem stakeholders from around the world. In addition, IFS runs advisory councils that are structured for each industry sector it serves. These advisory councils meet at least once per year. IFS also supports regional user groups that are independently run by its clients. The IFS product team regularly requests input from customers. This input is received informally, but also formally through the IFS Early Adopter Program and focus groups.
IFS offers product training to its clients and to its business partners through the IFS Academy. Both IFS and its business partners also provide consulting services for system installation and for ongoing client training.
Similarly, IFS sells its cloud ERP software both directly and through its business partners. Although IFS can structure its cloud ERP software as a subscription offering, in most cases, it prices its products and services based upon the requirements of each customer.
IFS does not offer a free trial of its cloud ERP software, but it does offer a tailored demo of its system to prospects, so they can see how they can benefit from IFS' cloud ERP software.