Additional Analysis of IFS and Intentia
Whether due to the same geographic origin or not, one can notice many similarities between Intentia (XSSE: INT B) and IFS AB (XSSE: IFS), in addition to a few differences. Having both been Swedish companies, both exude the domain expert knowledge within the industries of their focus, and both vendors have been congenial and disinclined to exaggerate their capabilities. On the down side, however, these traits are drawbacks in other more flamboyant, marketing-rich markets outside Scandinavia, particularly in the United States, where these vendors occasionally have been regarded as somewhat unexciting or reserved.
Having traditionally done implementations via their product delivery organization, IFS and Intentia have also long exhibited a focus on product quality and customer satisfaction that manifests into a lasting relationship with each client. Both IFS and Intentia boast long lists of delighted customer references as a display of their high level of confidence in their successful implementations and subsequent after-sales life cycle and upgrades.
While with the exception of some regional pockets, many may not have necessarily heard of Intentia's or IFS's good reputations outside Europe. Nonetheless the vendors have impressive backgrounds. Founded in 1984 and now Scandinavia's largest software company, Intentia is established in some forty countries with nearly 3,000 employees and 3,500 customers worldwide. Intentia's annual net revenues for 2003 were $363 million (USD), based on the average exchange rates for the period. IFS was founded a year earlier, in 1983, and it currently has a global presence serving forty-five countries with over 2,600 employees and 2,500 customers worldwide. Its annual net revenue for 2003 was $290 million (in USD), based on the average exchange rates for the period. However, based on the currency exchange rate (which is how revenue is typically reported making it more comparable with previous years results), the vendor reported $323 million (USD).
As for the industry focus, Intentia is a major player in selected industry verticals such as food and beverage; fashion; automotive; paper; steel; maintenance; service and repair; and wholesale and distribution. In addition to these, the 2004 focus for its EAM solution will include power generation; primary chemicals; third party outsourced maintenance providers; metals processing; ports; and airports. On its hand, IFS targets automotive suppliers; aviation and defense (A&D); energy and utilities; high-tech, industrial manufacturers (general engineer-to-order [ETO]/make-to-order [MTO] manufacturers); infrastructure and facilities management; batch process industries; rail and transit; and telecommunications. The common thread throughout these is complex, multisite engineering and manufacturing, bundled with a specialization in the more asset-intensive industries, particularly for the maintenance repair operating supplies (MRO) services management.
However, after a strong performance throughout the 1990's, both vendors suffered a sudden stall in total revenues growth upon entering into the new century (see figures 1 and 3). This was due, in part, to the soft market after the Y2K over-hyped phenomenon and followed by the global economic downturn. This brings us to some differences between the two vendors. For example, Intentia had an IBM-based platform centric approach in its Movex software until 1999, when it released a multi-platform version of Movex which was written in Java and included an optional web interface. For more detail, see our article Intentia's Movex for Food and Beverage: Gaining a Foothold in North America. Also, Intentia remains the larger and possibly a functionally better vendor of the two (in terms of multinational financials/consolidation, budgeting, HR/payroll, distribution/transportation, marketing campaigns, and other capabilities). However, at the same time, it is somewhat stodgier and only recently started to open up to the concept of selling into multi-vendor environments.
Figure 1
Figure 2
Conversely, back in 1994, IFS began a development project to transfer its flagship IFS Applications suite to object-oriented technology. The project was completed in 1997 with the launch of the IFS Applications 1998 product suite. The IFS' business concept has since focused on increasing the freedom of action and competitiveness of companies by enabling customers to either apply IFS solutions as a complete enterprise system, or as a complement to other vendors' applications within a specific part of the business process.
This is Part Three of a four-part note.
Part One defined EAM and CMMS.
Part Two discussed integration concerns.
Part Four will continue the analysis of two major vendors.
IFS Strategy
For over a decade, the cornerstone of IFS' strategy has thus revolved around its component-based architecture and vertical market focus, which thereby became part of its identity and a key ingredient in its ability to deliver an even deeper vertical industry functionality.
While specific astute modules within the IFS Applications Suite have contributed to IFS' success within certain verticals, one thing that IFS has long had going for it is its product architecture, which is highly component- and standards-based. Also recognizing its scalability limitation, in addition to the rigidity of its erstwhile two-tier client/server architecture, IFS first embarked on creating an n-tier product architecture in the mid-1990s. This n-tier product architecture separates presentation, business logic, and data storage layers, and also render IFS independent from the Oracle development tools and the use of stored procedures in the Oracle database. IFS Applications 2001 was heralded as a fully Internet-enabled and componentized five-tier architecture suite (with the data source, business entities, business activities, business processes, and presentation layers). It covered most of the traditional horizontal ERP functionality via a mandatory IFS Foundation layer, on top of which one can build in a pick-and-mix-type functional module stacks that are needed to satisfy needs of more specific businesses. These have been built through the company's own research and development (R&D) and through some of its acquisitions. Both endeavors use the industry's commonly accepted standards.
By splitting functionality across over sixty independent modules and by having a five-tiered, object-oriented logical product architecture, which separates the presentation layer from business process, and the business process from the underlying required business logic, database access, and the database itself, IFS demonstrates a possibly unique epitome of flexibility, both in terms of product adaptability to defined (and ever-changing) business processes and the ability to "cherry pick" required modules.
As they see fit, companies can select modules to co-exist with other legacy applications and databases, or select modules to simply avoid the "big bang" monolithic approach to enterprise application implementation—a practice that has long since been overcome. They can add components at their leisure and pace, which allows for user adaptation to the new tools and allows companies to begin receiving return on investment (ROI) quickly by staging their implementation scope in order of criticality. Built-in extensible markup language (XML) support and the external availability of all internal application programming interface's (API) mean that integration between IFS components and other companies' software should be a reasonable endeavor. For more details, see IFS To Be At Customers' (Web) Service.
Furthermore, owing to the component architecture, customers can, for example, even install the latest version of a certain IFS component while still using an older version of IFS Applications. Therefore, IFS' foray into web services has much credibility, since the company has likely dealt with the pieces of the concept before the latest industry buzzword has been coined. Namely, using web services objects, IFS Applications components are driven by business processes, which by the nature of encapsulation (i.e., making functionality known only by the interface it exposes), bode well for the ongoing product's instance agility.
Hence, in today's market where IT budgets remain extremely tight, IFS has a potential of offering customers highly specific modules to immediately address their specific pain points. Moreover, since the component architecture has been further enhanced within IFS Applications 2004 with Java 2 Enterprise Edition (J2EE) interface (dubbed IFS Service Oriented Component Architecture), and thereby further bases IFS' modules on open standards, they should more readily be integrated into a company's existing IT ecosystem.
Challenges to Both Vendors
Looking ahead, both vendors are moving to web services and composite applications. IFS' first composite application has recently been developed with partner ABB for process and energy industries and is currently available. On the other hand, having moved from the IBM iServer confinement, Intentia nowadays offer a much wider choice of platforms to the user, whereas IFS remains confined to Oracle database, which limits opportunities in the lower-end of the market. While the IFS Web/Applications/Connect server is ready to run on Microsoft SQL Server in the laboratory, given that some of the application logic has been migrated to be database independent (which should include the IBM DB2 database as well), there is still a lot to do before everything has been migrated and ready for commercial use. Given IFS' ongoing R&D investment scrutiny, that work will not likely be completed in the foreseeable future.
Namely, although not unlike other ERP and SCM software vendors, Intentia and IFS need to string together several quarters of profitability to restore consumer confidence and long-term stability, which is yet to happen (see figure 2 and 4). Recent reports have, however, indicated that both vendors have lately had many bitter pills to swallow in their attempt to stem the tide of poor consumer confidence in order to increase revenues and return to profitability, while, at the same time, developing the internal infrastructure to increase and measure efficiency and reduce costs
SOURCE:
http://www.technologyevaluation.com/research/articles/eam-versus-cmms-what-s-right-for-your-company-part-three-analysis-of-ifs-and-intentia-17213/
Whether due to the same geographic origin or not, one can notice many similarities between Intentia (XSSE: INT B) and IFS AB (XSSE: IFS), in addition to a few differences. Having both been Swedish companies, both exude the domain expert knowledge within the industries of their focus, and both vendors have been congenial and disinclined to exaggerate their capabilities. On the down side, however, these traits are drawbacks in other more flamboyant, marketing-rich markets outside Scandinavia, particularly in the United States, where these vendors occasionally have been regarded as somewhat unexciting or reserved.
Having traditionally done implementations via their product delivery organization, IFS and Intentia have also long exhibited a focus on product quality and customer satisfaction that manifests into a lasting relationship with each client. Both IFS and Intentia boast long lists of delighted customer references as a display of their high level of confidence in their successful implementations and subsequent after-sales life cycle and upgrades.
While with the exception of some regional pockets, many may not have necessarily heard of Intentia's or IFS's good reputations outside Europe. Nonetheless the vendors have impressive backgrounds. Founded in 1984 and now Scandinavia's largest software company, Intentia is established in some forty countries with nearly 3,000 employees and 3,500 customers worldwide. Intentia's annual net revenues for 2003 were $363 million (USD), based on the average exchange rates for the period. IFS was founded a year earlier, in 1983, and it currently has a global presence serving forty-five countries with over 2,600 employees and 2,500 customers worldwide. Its annual net revenue for 2003 was $290 million (in USD), based on the average exchange rates for the period. However, based on the currency exchange rate (which is how revenue is typically reported making it more comparable with previous years results), the vendor reported $323 million (USD).
As for the industry focus, Intentia is a major player in selected industry verticals such as food and beverage; fashion; automotive; paper; steel; maintenance; service and repair; and wholesale and distribution. In addition to these, the 2004 focus for its EAM solution will include power generation; primary chemicals; third party outsourced maintenance providers; metals processing; ports; and airports. On its hand, IFS targets automotive suppliers; aviation and defense (A&D); energy and utilities; high-tech, industrial manufacturers (general engineer-to-order [ETO]/make-to-order [MTO] manufacturers); infrastructure and facilities management; batch process industries; rail and transit; and telecommunications. The common thread throughout these is complex, multisite engineering and manufacturing, bundled with a specialization in the more asset-intensive industries, particularly for the maintenance repair operating supplies (MRO) services management.
However, after a strong performance throughout the 1990's, both vendors suffered a sudden stall in total revenues growth upon entering into the new century (see figures 1 and 3). This was due, in part, to the soft market after the Y2K over-hyped phenomenon and followed by the global economic downturn. This brings us to some differences between the two vendors. For example, Intentia had an IBM-based platform centric approach in its Movex software until 1999, when it released a multi-platform version of Movex which was written in Java and included an optional web interface. For more detail, see our article Intentia's Movex for Food and Beverage: Gaining a Foothold in North America. Also, Intentia remains the larger and possibly a functionally better vendor of the two (in terms of multinational financials/consolidation, budgeting, HR/payroll, distribution/transportation, marketing campaigns, and other capabilities). However, at the same time, it is somewhat stodgier and only recently started to open up to the concept of selling into multi-vendor environments.
Figure 1
Figure 2
Conversely, back in 1994, IFS began a development project to transfer its flagship IFS Applications suite to object-oriented technology. The project was completed in 1997 with the launch of the IFS Applications 1998 product suite. The IFS' business concept has since focused on increasing the freedom of action and competitiveness of companies by enabling customers to either apply IFS solutions as a complete enterprise system, or as a complement to other vendors' applications within a specific part of the business process.
This is Part Three of a four-part note.
Part One defined EAM and CMMS.
Part Two discussed integration concerns.
Part Four will continue the analysis of two major vendors.
IFS Strategy
For over a decade, the cornerstone of IFS' strategy has thus revolved around its component-based architecture and vertical market focus, which thereby became part of its identity and a key ingredient in its ability to deliver an even deeper vertical industry functionality.
While specific astute modules within the IFS Applications Suite have contributed to IFS' success within certain verticals, one thing that IFS has long had going for it is its product architecture, which is highly component- and standards-based. Also recognizing its scalability limitation, in addition to the rigidity of its erstwhile two-tier client/server architecture, IFS first embarked on creating an n-tier product architecture in the mid-1990s. This n-tier product architecture separates presentation, business logic, and data storage layers, and also render IFS independent from the Oracle development tools and the use of stored procedures in the Oracle database. IFS Applications 2001 was heralded as a fully Internet-enabled and componentized five-tier architecture suite (with the data source, business entities, business activities, business processes, and presentation layers). It covered most of the traditional horizontal ERP functionality via a mandatory IFS Foundation layer, on top of which one can build in a pick-and-mix-type functional module stacks that are needed to satisfy needs of more specific businesses. These have been built through the company's own research and development (R&D) and through some of its acquisitions. Both endeavors use the industry's commonly accepted standards.
By splitting functionality across over sixty independent modules and by having a five-tiered, object-oriented logical product architecture, which separates the presentation layer from business process, and the business process from the underlying required business logic, database access, and the database itself, IFS demonstrates a possibly unique epitome of flexibility, both in terms of product adaptability to defined (and ever-changing) business processes and the ability to "cherry pick" required modules.
As they see fit, companies can select modules to co-exist with other legacy applications and databases, or select modules to simply avoid the "big bang" monolithic approach to enterprise application implementation—a practice that has long since been overcome. They can add components at their leisure and pace, which allows for user adaptation to the new tools and allows companies to begin receiving return on investment (ROI) quickly by staging their implementation scope in order of criticality. Built-in extensible markup language (XML) support and the external availability of all internal application programming interface's (API) mean that integration between IFS components and other companies' software should be a reasonable endeavor. For more details, see IFS To Be At Customers' (Web) Service.
Furthermore, owing to the component architecture, customers can, for example, even install the latest version of a certain IFS component while still using an older version of IFS Applications. Therefore, IFS' foray into web services has much credibility, since the company has likely dealt with the pieces of the concept before the latest industry buzzword has been coined. Namely, using web services objects, IFS Applications components are driven by business processes, which by the nature of encapsulation (i.e., making functionality known only by the interface it exposes), bode well for the ongoing product's instance agility.
Hence, in today's market where IT budgets remain extremely tight, IFS has a potential of offering customers highly specific modules to immediately address their specific pain points. Moreover, since the component architecture has been further enhanced within IFS Applications 2004 with Java 2 Enterprise Edition (J2EE) interface (dubbed IFS Service Oriented Component Architecture), and thereby further bases IFS' modules on open standards, they should more readily be integrated into a company's existing IT ecosystem.
Challenges to Both Vendors
Looking ahead, both vendors are moving to web services and composite applications. IFS' first composite application has recently been developed with partner ABB for process and energy industries and is currently available. On the other hand, having moved from the IBM iServer confinement, Intentia nowadays offer a much wider choice of platforms to the user, whereas IFS remains confined to Oracle database, which limits opportunities in the lower-end of the market. While the IFS Web/Applications/Connect server is ready to run on Microsoft SQL Server in the laboratory, given that some of the application logic has been migrated to be database independent (which should include the IBM DB2 database as well), there is still a lot to do before everything has been migrated and ready for commercial use. Given IFS' ongoing R&D investment scrutiny, that work will not likely be completed in the foreseeable future.
Namely, although not unlike other ERP and SCM software vendors, Intentia and IFS need to string together several quarters of profitability to restore consumer confidence and long-term stability, which is yet to happen (see figure 2 and 4). Recent reports have, however, indicated that both vendors have lately had many bitter pills to swallow in their attempt to stem the tide of poor consumer confidence in order to increase revenues and return to profitability, while, at the same time, developing the internal infrastructure to increase and measure efficiency and reduce costs
SOURCE:
http://www.technologyevaluation.com/research/articles/eam-versus-cmms-what-s-right-for-your-company-part-three-analysis-of-ifs-and-intentia-17213/
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