@SuiteApps: Manufacturing in the Cloud

Guido Haarmans, Vice President, NetSuite Developer Programs & Business Development

IQity Solutions partners with NetSuite to help manufacturers respond to market pressures by providing advanced manufacturing and plant-level control capabilities that are integrated with NetSuite. For this issue of NetSuite Magazine I sat down with David Gustovich, Founder and President of IQity Solutions, to discuss trends in manufacturing and the implications of the cloud for manufacturers.

GH: What are some of the biggest trends impacting manufacturers today?

DG: The market pressures on manufacturers to reduce costs and increase flexibility and efficiencies have never been greater. These pressures have increased the complexity on manufacturing. In addition, customers are more sophisticated and the global economy makes everything more competitive. Many manufacturers are being forced to realign their business processes, systems, resources, and improvement initiatives to respond, ushering in a new era of Plant to Enterprise (P2E) unification and smart manufacturing.

GH: Why is Plant to Enterprise unification important?

DG: It’s all about ROI. Many manufacturers don’t have a complete picture of the recoverable financial value caused by a disconnected enterprise. Disparate systems increase costs, and aggregating, moving, and analyzing data is time-intensive and always after the fact. By synchronizing data into one unified data model, multiple systems can be managed in one real-time package, creating transparency to the data source, empowering continuous improvement, and better leveraging existing investments for competitive advantage. More importantly, or perhaps more actionable, an integrated P2E view allows manufacturers to understand true costs, available inventory, process efficiency, and enable better customer responsiveness at lower cost, with higher quality and service levels.

GH: What impact does a unified P2E have on correlating plant metrics to business metrics?

DG: Cost, quality, and service are always the top priorities. Manufacturers must find ways to better leverage their data (sometimes hidden) within their disparate business systems, processes, and human interactions to impact these metrics. For some time, manufacturers have focused on the mechanics of data collection, but not necessarily the analysis and usage of that data. Manufacturers are now realizing they must unify their plant with their enterprise business systems to accelerate companies’ efforts to re-engineer, work smarter, and improve operations based on insights gained from correlating their plant and business metrics.

For example, based on our experience, achieving a 25 percent improvement in throughput and reducing operating costs by 2 to 12 percent is realistic by integrating plant-level control systems into enterprise business systems.

 

GH: Earlier you mentioned smart manufacturing. Can you explain this more?

DG: Smart manufacturing marries information, technology, and human ingenuity to bring about rapid improvements in all facets of the enterprise and supply chain. Progressive manufacturers have already begun linking their value chains together, something NetSuite and IQity make possible. By seamlessly integrating all this information into role-based views and actionable insight for executives, managers, operators, or customer-facing functions enables manufacturers to become more innovative, smarter, and flexible in how products are designed, manufactured, and sold.

GH: How is IQity extending NetSuite’s platform in manufacturing environments?

DG: First, IQity is helping manufacturers integrate their shop floor to the cloud by making the P2E cloud-based vision a reality. Second, IQity has built a manufacturing SuiteApp that installs within NetSuite to provide the necessary infrastructure and integration into IQity’s advanced manufacturing solution. The SuiteApp allows users to create items like work centers (assets), routings and associated BOMs, quality parameters, labor, capacity, equipment settings, metrics, travelers, and so on required to drive the underlying business logic. IQity leverages and extends NetSuite native functionality and communicates seamlessly for both planned and actual information, always maintaining NetSuite as the system of record.

GH: NetSuite and IQity are cloud apps, so what impact is the cloud having on manufacturers?

DG: Manufacturers are beginning to realize that technologies that require extensive IT overhead and infrastructure are more of an anchor to progress than an enabler. Consider the NetSuite and IQity platforms—we provide a powerful end-to-end solution to manage order-to-cash, procure-to-pay, plan-to-build, and build-to-ship, all in the cloud. Manufacturers save time and money, reduce the IT load, simplify their business complexity, and respond more efficiently to changing demands.

Like NetSuite, at IQity we see broad adoption by manufacturers. The cost advantages, choices, flexibility, scalability, and value proposition all make it an inevitable trend.

Manufacturers are constantly looking for ways to improve their operations and gain a competitive edge in efficiency, speed, and costs, so to leave this value on the table isn’t an option. Another key element that manufacturers will take advantage of in the future is how the cloud improves visibility and collaboration with customers and suppliers. The advantages that NetSuite and Iqity have are that we understand how to lead an organization’s transition to the cloud, and our products and services are designed to support a customer’s budget and time line.

Gartner research indicates that in the next few years, manufacturers’ embrace of the cloud will grow more than 10 percent while distributors/ wholesalers will grow to more than 30 percent of all wholesale distribution companies. Impressive growth considering that just a few years ago, no one heard of manufacturers running their business in the cloud.

GH: How does this support the improved visibility and performance that we were talking about earlier?

DG: Manufacturers and their business systems must be flexible. An integral component of all NetSuite and Iqity installations is our cloud-based data connector. The connector provides flexibility to connect directly to equipment, OPC data tags, PLCs, SCADA, HMI, Historian, or other legacy systems to allow for real-time data streaming. The results are improved visibility and active alerts to notify key personnel of performance erosion.

By using hand-held devices, scanners, or web-form interfaces, manufacturers can integrate critical production elements to provide a complete picture of how the process is performing. All this information can be parsed to give operators, inspectors, managers, and executives powerful interactive role-based views, dashboards, and dynamic reporting to monitor and analyze production results in real-time to empower continuous improvement.

IQity has developed a key metric called the financial Opportunity Value Gap ($OVG). The $OVG is the financial gap between your process capabilities versus actual results. This metric helps manufacturers focus their continuous improvement and Lean Six Sigma practitioners on those critical areas that will have the greatest influence on cost, quality, service, and performance.

GH: What are some key business benefits that manufacturers have achieved?

DG: Our goal is to help customers improve operational effectiveness and reduce the costs to improve profitability. Whether you’re a batch, continuous, discrete, repetitive, make-to-order, or stock business, NetSuite with IQity is flexible enough to meet your business needs and power your next level business results. Depending upon your environment and circumstance, the range of benefits can be significant, as outlined above.

You can learn more about Iqity Solutions and other SuiteApp partners by visiting SuiteApp.com.