As someone who’s followed the SaaS and cloud market since the earliest days — even back to the last century — I’ve frequently encountered Plex Systems, which first launched its cloud ERP software for manufacturers back in 2001. But I had never visited in person or attended one of its events until a couple weeks ago, when I took part in an analyst summit held at its headquarters in Troy, Michigan.
There’s no substitute for spending time in person, hearing from customers and company executives, to really understand what makes a business tick. Here are five things I learned from my visit about Plex and its manufacturing cloud.
MES is core
While I had been aware that Plex’s products interact deeply with the manufacturing shop floor, I had not fully appreciated what that meant until witnessing it at first hand. From a software industry perspective, Plex is categorized as a cloud ERP vendor that serves manufacturing clients, but that understates the extent to which its products revolve around what happens on the shop floor.
In truth, Plex’s core offering is a manufacturing execution system (MES), which manages and tracks the progress of parts, materials and production through the manufacturing process on the shop floor. It offers a range of closely related functions, such as quality management, production planning, inventory, shipping and supply chain management.
Many customers also use Plex for more mainstream ERP functions, including financials, procurement and people management — but still retaining that close affiliation with shop floor operations. In the case of HCM, for example, an important aspect of the learning management function is to ensure that staff are qualified to operate any equipment they’re using.
To put it bluntly, I’d always conceived of Plex as a cloud ERP system that specializes in manufacturing. But I was looking at it from the wrong perspective. At its core it’s a cloud MES, which has expanded to include manufacturing-specific ERP capabilities.
Quality is king
One of the learnings that really brought this home to me was when I heard customers talking about how they had used Plex to automate their quality processes. This is one of the most important elements of any physical manufacturing operation. Manufacturers have to be able to demonstrate to their customers that they have processes in place to monitor the consistency of every item they make and its adherence to the standards laid down for its production.
There are frequent quality audits by customers to ensure that these processes are in place and that they’re being followed. Manufacturers themselves rely on the records to be able to demonstrate they’ve done what was required of them in cases where the customer finds a problem with goods they’ve received, or if there’s a warranty claim later on. If they can show the item was in good condition when it left them, it reduces the risk they’ll incur a financial liability.
You can see how business-critical this can become. Yet in much of manufacturing industry, these quality processes are still largely paper-based. Inevitably, that exposes them to errors and omissions, while quality audits are tortuous, nerve-wracking experiences. For Plex customers, that’s not the case.
“Audits take us no time,” says John Sammut, CEO of Firstronic, which makes complex printed circuit boards for automotive, medical and industrial customers. The electronics manufacturer is able to show customers the entire quality process on screen in the conference room before even visiting the shop floor. “They’re blown away,” he says.
“I want no paper in my manufacturing environment,” says Gary Johns, CEO at Ohio-based contract metal manufacturer G&W Products, and you can understand why. But as an indicator of how rare that is in the manufacturing sector, one quality auditor was perplexed to discover that G&W employees sign off work on screen rather than on paper. He was so used to seeing a signed piece of paper, an all-digital process was completely new to him.
It’s a broad customer base
I’d had the impression that the Plex customer base was largely in the automotive industry, based on its roots in the Detroit area, but that’s no longer the case. In addition to all manner of automotive component suppliers and metalworking specialists, I met a maker of deep cycle batteries, an electronics manufacturer, a maker of heat exchangers and three food manufacturers. The presence of several customers from the food processing industry reflected Plex’s expansion into process manufacturing, which among other things builds on its strengths in quality process monitoring.
Plex is also signing larger contracts these days, although it’s continuing to expand its presence among small and midsize manufacturers. as Don Clarke, CFO and currently interim CEO, puts it:
We make sure we never lose our effectiveness at selling to midmarket manufacturing. If you have a product that scales up and down, you’d be crazy not to go after small and midsize manufacturing companies.
Data is the next frontier
It was clear that Plex is preoccupied with how it can help its customers make the most of the data they’re collecting from the shop floor and elsewhere in their business operations. Last year it acquired supply chain planning application DemandCaster, and it continues to work on evolving visualization, dashboards and analytics within its core product.
Insight into data and operations is already an important differentiator. Giving workers on the shop floor real-time insight into throughput and stock requirements empowers them to be more effective, says Firstronic’s Sammut. At G&W, Johns says he likes the competitive advantage that comes from his people being able to react to customer requests and update manufacturing schedules from a smartphone even while having dinner at home.
IoT is close, but no AR
As outlined in an earlier article about how Fisher Dynamics has worked with Plex to leverage IoT and wearables on the shop floor, the vendor is keen to work with customers to explore the potential of emerging technologies.
But it will be a while yet before augmented reality takes hold on in manufacturing environments, says CTO Jerry Foster.
We’ve come to the conclusion that augmented reality in the shop floor is really difficult.
While there’s been talk of field service engineers using augmented reality (AR) on tablets to repair equipment, that’s a different setting than an operational production environment. Trials that Plex has done with Hololens and other AR devices have encountered various problems.
Mapping a virtual replica of the shop floor environment is tricky, and the movements needed to control and explore an AR field of vision are too clunky to be practical on the shop floor. On top of that, consumer devices are quite fragile, while specially ruggedized AR helmets are expensive, costing around $10k apiece. All of this leads Plex to conclude that AR’s time has not yet arrived, at least not in manufacturing.
My learnings on this visit show the importance of getting face-to-face from time to time. The other learning that impressed me was how closely Plex has always worked with its customers to understand their real-world needs. The best application software comes from finding out the pain points of individual users and coming up with automation that helps them do better work. That’s always been the approach at Plex, and it’s reflected in the goodwill and loyalty of customers.
Image credit - via Plex
Disclosure - Plex is a diginomica premier partner and funded the author's travel to attend its analyst summit.