IQMS Prospers by Helping Enterprises Work Smarter

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 (http://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.

This is Part One of the IQMS Prospers by Helping Enterprises Work Smarter series.

Part Two will begin the market impact.

Part Three will continue a discussion of product differentiation.

Part Four will review IQMS' Single Database Solution and quality management.

Part Five will cover integrated EDI and miscellaneous utilities.

Part Six will present challenges and make user recommendations.

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.

This concludes Part One of a six-part note.

Part Two will begin the market impact.

Part Three will continue a discussion of product differentiation.

Part Four will review IQMS' Single Database Solution and Quality Management.

Part Five will cover integrated EDI and miscellaneous utilities.

Part Six will present challenges and make user recommendations.