FollowMay 2020
Headache Relief in Times of Crisis
Manufacturers today face extraordinary challenges as the world is plunged into an unprecedented crisis. Even as we see efforts to recover, everyone was and is affected, though not necessarily in the same way. Some industries were completely shut down while others (think software and professional services) could close offices and still remain at least somewhat productive. Manufacturing lies at both ends of the spectrum. Obviously you can’t make industrial or consumer products from home – at least not at scale. But within the realm of manufacturing, we see a widely diverse impact of the COVID-19 pandemic, depending on what is being manufactured. Cloud computing and advanced technology that supports connectivity, collaboration, automation and agility have eased the burden for some, while others struggle (still) amidst shelter-in-place orders that caught many flat-footed.
Those companies operating on the Plex Smart Manufacturing Platform are among the more fortunate, whether they are manufacturing products deemed “essential” or not. Of course no piece of software can fully address the crisis of needing to completely shut down production. But even those businesses still have cash to collect and customers to support. As administrative and support personnel were locked out of their offices, Plex’s native Software as a Service (SaaS) deployments allowed employees to start working from home immediately. And as many manufacturers have had to pivot their businesses, efforts from Plex over the past several years to provide automation, collaboration capabilities and an added level of agility are all paying off.
For anyone who still questioned the value of cloud, SaaS and digital transformation at the beginning of 2020, the words of Plex Systems CEO, Bill Berutti, should ring true. “This crisis is shining a whole new light on the power of technology and the power of smart manufacturing, to make us more agile in times of crisis, to allow us to adapt.” Let’s take a look at a few of the ways Plex’s solution provides some relief from the headaches that come along with this crisis.
SaaS Proves its Value
Let’s start with the obvious. The capability to access anytime, from anywhere is inherent in software solutions that are accessed via the cloud and delivered as a service. Mint Jutras has been extolling the benefits of cloud computing and software as a service (SaaS) for many years now, but in spite of all the hype associated with cloud and SaaS, we still see evidence that many don’t fully understand the difference between the two or the benefits SaaS can bring. Whether you run a solution on your own premises or in a private or public cloud, the ability to access anytime, from anywhere is a significant advantage and web-enablement opens the door for the kind of connectivity you need as workers work from home. The ability to connect is critical, but how you connect is equally important. This issue surfaces when suddenly office workers became remote, work-from-home workers.
One of Plex’s customers, Accuride, provides the perfect example. Accuride primarily makes steel and aluminum wheels for the heavy trucking industry. As a global company that made a recent acquisition in Europe, Accuride runs the Plex Smart Manufacturing Platform in some of its divisions, but not all. While workers in the locations using Plex were able to start working from home almost immediately, it took several days of frantic work to support remote workers where solutions were still on premise. The recently acquired division in Germany is still running an SAP solution on premise. It needed to upgrade from 100 VPN connections to support 250 newly remote users very quickly – not an easy task. This only served to validate Accuride’s strategy to move to the cloud and SaaS.
Trojan Battery is another example. A longstanding Plex customer, it completed its shift to SaaS at the end of 2018. It not only runs Plex, but also Dropbox, RingCentral, Workday and Salesforce. But the company was subsequently acquired by C&D Technologies, which still uses on-premise solutions. While Trojan Battery employees were able to take their laptops and mobile devices or just sit down at their home computers and have full and immediate access to the same data and systems they had in their offices, those from C&D Technologies that were still using on-premise applications had a much different experience. They needed access through a VPN, which proved to be a significant pain point, especially for those employees who had never before been issued a laptop (having no need for one). As IT Director Matt Irey points out, “We can’t open our corporate network up to unsecured machines, so they’ve got to be using company equipment.”
This also raised the issue of network performance. Mr. Irey goes on to say, “There’s limited bandwidth — guaranteed Plex, Workday, Dropbox, have a heck of a lot more bandwidth than I do going into my location.”
Plex was an early pioneer of SaaS. It has offered its solution exclusively as a multi-tenant SaaS solution since 2001, long before cloud and SaaS were even part of the vocabulary of the typical manufacturer. Back then most manufacturers weren’t even knowingly and willingly considering SaaS. And so, for many years, the company was successful in spite of, rather than because of its pioneering efforts in SaaS. The key to this success lies in offering a more complete solution for manufacturing, stretching beyond the typical boundaries of Enterprise Resource Planning (ERP).
The 4 Pillars of Smart Manufacturing
This has led it to its current offering, the Plex Smart Manufacturing Platform, a rather unique combination of ERP, Manufacturing Execution (MES), Manufacturing Operations Management (MOM), supply chain management, industrial Internet of Things (IIoT) and analytics.
What makes the platform a “Smart” platform is data, often described as the “new oil” or the most valuable resource of today. Plex recognizes that the four pillars of a Smart Manufacturing Platform are:
- to connect and integrate to data sources (including machine data)
- to automate (processes and data collection)
- to track (and trace)
- and analyze that data
In addition, the system, along with the data, must also be available, reliable, scalable, secure and agile. Over the years Plex has excelled in areas like availability and reliability. Its service level agreement (SLA) promises 99.99% availability and it has delivered 99.996% availability over the last four years, with an average of just 22 minutes of unplanned downtime each year. With those statistics on the books, along with an impressive track record of security, last year it decided to focus more heavily on agility.
The Increased Need for Agility
The need for agility has been on the rise for the past several years. We live in disruptive times.
Figure 1: How much risk do you face in your industry being disrupted?
Source: Mint Jutras 2018 Enterprise Solution Study
Back in 2018, the Mint Jutras Enterprise Solution Study found 89% of manufacturers believed they faced some level of risk in their businesses and/or industries being disrupted by new innovative products, new ways of selling or pricing existing products or services, entirely new business models, or some combination of all of the above. And then of course there were (and still are) the more traditional disruptive factors like expansion and growth, organizational restructuring and regulatory changes, just to name a few. And now… a global pandemic.
While different industries and individual companies face an incredibly diverse range of challenges, there is one constant today, and that is an element of uncertainty. No one really knows what the “new normal” will be. Some Plex customers have already had to pivot their businesses very quickly.
As noted earlier, this global crisis has impacted different industries in very different ways. While some making products that are not deemed “essential” have been forced to close, others are struggling to keep up with higher demand. Select food, beverage and personal care products are experiencing a boost in demand. Manufacturers of medical supplies and equipment (think ventilators and face masks) are facing increased demand that can far exceed capacity. Others making industrial or non-essential consumer products are forced to re-tool and ramp up production for new and different products. We see hair care manufacturers making hand sanitizer and automotive suppliers making ventilators or personal protective equipment (PPE).
Each option brings its own set of challenges, often requiring new supply sources and processes that include shop floor redesign or limiting capacity to create social distancing. Some are responding quickly, but many are not, as evidenced by shortages of staples like toilet paper, disinfectants, flour and other necessities. We’ve seen evidence of brittle supply chains and manufacturers that remain rigid and inflexible. While enterprise software solutions can’t (all by themselves) overcome all these hurdles, they certainly can contribute to the pain or ease the burden as innovative companies undergo a paradigm shift.
One Less thing to Worry About in Shifting Gears
Creative Foam, another Plex customer, is one manufacturer that has quickly pivoted its business. The company turned 50 years old this year and specializes in foams, nonwovens and adhesives in industries that include transportation and healthcare. Creative Foam engineers seek to create products that are quieter, stronger and lighter.
But in the wake of the crisis, the company was able to quickly shift gears. Tareq Falah, Vice President of Information Technology and Information Systems tells us, “Nobody had a crystal ball. No one could have predicted anything that is going on now during this COVID crisis – not when, not who, not how. Before, we had always asked ourselves, ‘What can we do to win business?’ But in response to this crisis, we went through a paradigm shift. Now we ask, ‘What else can we do to help?’”
Essentially Tareq was talking about helping the front-line workers in the field of medicine. They began with PPE, face shields to be more precise. This meant sourcing new materials, coming up with an initial design and then refining that design. And throughout this pivot, office workers went home to work. While there were many issues to resolve like getting people laptops and rerouting phones, according to Tareq, “We didn’t have to worry about Plex. Support of our business has been phenomenal.”
Another success story in responding to this global crisis is Olde Thompson. Founded in 1944, the company started out manufacturing houseware products, including salt and pepper mills. Today 80% of its business is in the powders that might go into the original products, including salt, pepper and a wide array of spices. While other businesses have slowed or stopped production, Olde Thompson has doubled its monthly output in response to increased demand.
Plex’s inventory management capabilities and its supply chain planning tool were key to Olde Thompson’s ability to respond to this spike in demand while its competitors simply could not react as quickly. When India shut down all spice manufacturing, Olde Thompson was able to locate and engage with other suppliers. This opened the door to acquiring three new customers. Being able to quickly bring on new customers using Plex’s new Smart EDI, a more scalable and flexible approach to onboarding new customers, meant this new business was not just a short-term blip, but the beginning of long-term relationships with three new customers.
But the real key to winning this new business was in Olde Thompson’s ability to ramp up production quickly. And the key to that was integration – pulling data out of machinery and automating machine setups using data within Plex. Process improvement is a key focus looking forward and Olde Thompson will be relying on Plex to provide visibility to their yields and support continuous improvement and long-term growth.
Speaking of Supply Chain Planning…
Plex also recently made another announcement that will assist customers in reducing the risk associated with market volatility, a subject that can strike fear in the hearts of many manufacturers today. On May 14,2020 it announced the release of the Plex Market Forecast Manager, now part of the Plex Supply Chain Planning Suite. Creating and maintaining a viable forecast has always been hard, but the uncertainty introduced with the COVID-19 makes it even more difficult.
According to Plex:
“Plex Market Forecast Manager enables manufacturers to integrate internal and external data points alongside demand plans to drive more accurate inventory decisions, gain market share, and evaluate and scale the supply chain. The initial release will provide automated access to IHS Markit’s Light Vehicle Forecast, helping automotive manufacturers form more accurate and timely forecasts. IHS Markit is a world leader in critical information, analytics, and solutions for the major industries and markets that drive economies worldwide.”
While the initial release of this new module specifically targets the automotive industry, perhaps Olde Thompson will not immediately benefit, but we suspect it will be able to at some point down the road. One of the industries IHS Markit follows is agribusiness, which of course supplies the food, beverage… and spice market.
Focus on Automation
Beyond the ability to connect, another of the four pillars on which the Plex Smart Manufacturing Platform is built is automation. Certainly, automation also plays a key role in alleviating some of the pain associated with the COVID-19 crisis. For decades now manufacturing has been investing in automation on the shop floor. Automation can speed production, eliminate variability, improve quality and reduce costs. An unfortunate side effect has been that it has also cost some jobs. But in all fairness, it has also created jobs, although these new jobs require different skills.
Now in the midst of a global pandemic, when the health and safety of workers is top of the list in terms of priorities, there is a silver lining in the reduction in workers required to keep production running. If you simply need a handful of employees to monitor automated production, those employees are more likely to be able to maintain acceptable social distancing and product continues to be produced. And now as this automation (think robots, PLCs, mechanical devices) are increasingly connected to the Internet, taking advantage of the Industrial Internet of Things (IIoT), perhaps production can be monitored remotely. Even remedial work might be done through augmented reality, with limited staff on site.
Plex’s engineering team, led by CTO Jerry Foster, is constantly investigating and experimenting with leading edge technology including augmented reality (think hands free and/or remote monitoring and even remote repair). Those investigative efforts also led to the acquisition of DATTUS in 2018 to accelerate IIoT adoption through connectivity, data management and data analysis.
But there is more to automation than machines and robots on the shop floor. There are many processes that must occur in the back and front offices of manufacturers that can be streamlined and automated, freeing office workers from repetitive tasks. And therefore, on May 14,2020, Plex announced Robotic Process Automation (RPA) can now be added on to the Plex Smart Manufacturing Platform through a new partnership with business technology solution provider Thirdware.
An early adopter Plex customer Stant Corporation, a tier-1 automotive supplier of thermal and vapor management parts, worked with Plex and Thirdware to implement RPA to manage its invoice delivery. This was a labor-intensive and error-prone process, spread across multiple technology solutions. With the help of a bot on the Plex Smart Manufacturing Platform, Stant has been able to reduce its invoice backlog from three weeks to four days, with 100% data entry accuracy. Now, 80% of invoices are able to move to processing without intervention, enabling the Stant team to focus on more valuable problem-solving activities. And of course, a bot never has to move to a remote working location during a global pandemic. After this first (successful) application of the technology, Stant went on to work with Plex and Thirdwave to create more. It now uses multiple bots for accounts payable, accounts receivable, customer service, and supply chain processes.
Summary and Recommendations
Manufacturers across the globe face many different challenges as the world tries to emerge from a global pandemic. Depending on where you live, the worst may be over. Or not. And even as we see signs of recovery, there is a high likelihood that things will never go back to exactly the way they were before. These factors combined reinforce the one common theme that confronts us all: uncertainty.
One thing is certain. As the communication and interaction around the world continues down the path of becoming more digital and more virtual, cloud computing and advanced technology that supports connectivity, collaboration, automation and agility step out of the realm of “nice to have” and become table stakes. Those manufacturers operating on the Plex Smart Manufacturing Platform are fortunate in that the solution that runs their businesses allowed them to immediately support workers remotely. Plex also continues to innovate to bring more automation, to connect and integrate, to track and analyze.
If you are a Plex customer today, our advice is to hold the fort and continue to consume as much innovation as Plex can throw your way. If you are not a Plex customer and you are still struggling to connect newly remote workers, if you don’t have the agility to support whatever the new normal way of operating becomes, you might be thinking implementing a new ERP, MES, or MOM solution is the last thing you want to tackle right now. You could be dead wrong. If business is slow, take advantage of the down time. It’s okay to be dead wrong. It’s not okay to let your business die.
