Introduction
Grand Rapids was the host for PowerPlex. For those who have not been there, it was an amazing location. Grand Rapids and PowerPlex challenge the media negativity about US manufacturing and the declining cities. Innovative,1 creative, clean, friendly and fun, the economy and city are thriving. A fitting location for PowerPlex.
Jason Blessing, CEO of Plex Systems, kicked off the conference by speaking to the 900attendees with a quick review of progress since last year, plus a forward look to what Plex is doing now and in the near future.
Plex is not, Jason said, “ — a little company in the Midwest with little customers.” Rather, they are global and growing, leading the cloud movement. In fact, we heard a lot of foreign languages being spoken during the three days. And we talked to many customers who selected Plex to beat out the Oracles, SAPs, Infors and Epicors in recent deals. Power for Plex is not just about driving one of the latest SaaS infrastructures in the world but being a real market leader in the ERP business.
“Growth is the lifeblood of a software company,” Jason said. And that is what Plex has been doing. With 60 new customers since last year, and an additional investment from Accel Partners and T Rowe Price, Jason said these funds “ — will go into the product and customer support, where they belong. Every dollar invested in the product is highly leveraged, since, unlike other ERPs who have to support multiple products, at Plex we have only one. With 100% of our customers on the current release, this means that investment benefits all of the community.” Plex comes from a self-funded heritage, so they know how to stretch a dollar, unlike Silicon Valley startups who burn through capital and have ephemeral customers. Plex customers are committed. They make things and thus appreciate products with depth.
Plex made some important announcements which we will cover briefly.
- Levels of Support — Silver, Gold and Platinum. All Plex customers get the same level of support in terms of response time (silver, gold). What is new is the Platinum service which assigns a dedicated resource to your company. This is particularly valuable in this new world, allowing companies to take advantage of sophisticated software, with low or no IT staff.
- Plex Enterprise Edition — Plex always had global customers, but generally supported plant-level activities. (As an example, read about Shape Corp., below in Customer Highlights.) Plex Enterprise Edition has comprehensive financials that will allow either larger enterprises to use Plex, or support a broader global footprint for midsize manufacturing who may want to do everything in Plex.
New UI — Jerry Foster, Plex’s CTO, announced some innovative changes at Plex. For example, they have the first ever Google glass application for manufacturing. (Below, see video of Plex customer using Google glass.) “What we have today is more of a tease of what hands free/wearable technology can provide,” mentioned Foster in my follow-up Starbucks session. Like most software firms, supporting mobile and modern user experience is important. But providing this for shop floor personnel — not office workers — is different.2
- Supply Chain — Jason Prater announced Plex’s new Constraint-based schedule solution. Here is a lost opportunity for someone. Since there aren’t a lot of supply chain applications in the cloud that would be capable of partnering with Plex, they developed their own.3 It will be interesting to see how this capability is embraced by the user community.
Who is a Plex Customer?
Real Manufacturers
At most conferences, we love to meet with customers. In particular, manufacturers who actually make things. At PowerPlex that was virtually everyone, everywhere you turned. These are not just brand owner ‘manufacturers’ that outsource their manufacturing to others. Plex’s customers are ‘hardcore manufacturers.’ At the opening reception, the very first table I (Bill) sat down at had people from a company that manufactures high strength carbon steel for tools (such as bandsaw blades), another company that makes automotive stampings, and a third that makes plastic and steel industrial fasteners (5M per day!). At the next table, I got an education on how injection modeling actually works, including modern innovations that help their company differentiate in this low-margin commodity business. I met another firm that manufactures a really innovative new kind of battery for storing solar energy, another that is a fast-growing craft brewer, and another that does steel slitting. We met many more during the conference, but this gives you a feel for the kind of companies running Plex.
When asked what these companies gained by switching to Plex, one common thread was much better and more granular visibility into their actual cost of production–multi-plant-wide. They could now see what each part actually cost to make, and where that cost was coming from. This has helped them understand where the improvement opportunities are for both cost and quality.
Release Cadence
On Premise’s Traditional “Big Bang” Release Model
One of the differences often seen between SaaS vs. traditional software companies is the cadence of their releases. Traditional on-premise software companies typically put out a new release every 12-18 months. This is both painful for the vendor and disruptive for the customer, what to say often requiring more out of pocket expenses to get outside help to manage the upgrade. For the vendor, it becomes a huge, high-consequence event, with an intense crescendo of effort as the release date nears, to bring the number of bugs down to an acceptable level before shipping. After release, they need to issue numerous ‘patches’ to fix all the inevitable problems that were not caught before the release. When a customer has a bug, the solution provider’s support organization needs to find out which patches have or have not been applied.4
The Plex Difference — Continuous Deployment / Continuous Innovation Model
In contrast, most SaaS companies release much more frequently; once every three months is fairly common. But Plex takes it to another level, releasing features more or less continuously. That model is actually quite different even than the typical SaaS.5 As one of the Plex team said, “We put in smaller functionality frequently. When you try to put in a really big piece all at once, it breaks things.” Each feature Plex releases is turned off by default upon release. Each customer decides whether and when to turn it on.6 Plex provides a ‘sandbox’ capability in which the customer can try out any new feature. The sandbox uses the customer’s exact configuration with an exact (recent)7 copy of their data. Customers can try out new features in the sandbox to decide if and when they want to turn them on in their production setup. They can let the appropriate employees — actual factory machine operators, finance person, or other functional role — try it out and get questions resolved before going live.
Customers’ Decision Process for New Features
The path to new enhancement can be through customer/community sponsored or Plex invested. Customers, of course, want new functionality, so they often work as a group to fund work. Of late, Plex has invested in an enhanced product effort to spur global and up-market growth. These investments come out of Plex’s pool of cash.
Plex customers usually have one or more ‘product champions’8 within their organization who track what features are being released by Plex and make decisions on which functions to bring to the attention of the appropriate people in their company. They also can participate in the Plex community to track new features and discuss them with peers to find out what others have implemented and what impact it had. The Plex customer base therefore is a different culture than you would see in a software customer’s community. Engaged, involved and even feeling accountable for what happens — not the victim of a company that feels distant and detached.
Often, especially for larger functionality sets, Plex will invite some customers to participate, giving feedback during the design and development phases, trying out small sets of features as each cohesive piece of the larger overall functional module is ready to try out. This way Plex gets continuous feedback throughout the development process, fixing things as they go9 and retesting, rather than having one gigantic painful beta test at the end.
From the customers’ perspective, there is a continuous flow of incremental innovation opportunities emanating from the Plex platform. Most are quite modest in scope and much easier to digest than the ‘big bang’ disruptive change required from traditional software upgrades. Manufacturing companies in particular are well acquainted with the continuous improvement model on their plant floor and operations — they are continuously looking for tweaks that can make their operations run better.
Customer Highlights
A customer that typifies the Plex community is Shape Corp. http://www.shapecorp.com/. We spoke with Molly Hunting, Director of Information Technology about their experiences with Plex. Shape and Plex have grown together. Since their first implementation of Plex, Shape has grown, supporting the global auto industry from one plant in 2001, into Asia, and with twelve plants worldwide. Shape Corp. uses Plex to manage every aspect of their manufacturing. Typical of Plex customers, yet mind-blowing, is that although Shape is a worldwide company with about 3,500 employees and runs everything from HR to PLC, Plex can support them all with about 21 IT employees!Rather than a large IT staff, Hunting has many analysts who are functional and have (Plex) expertise to work with the user community to assure all their reporting and information needs are met. They can also participate in various Plex forums to keep the product growing and to meet Shape’s needs.
Sanoh America — Shop Floor Integration
We heard from Jason Murray, an ERP and EDI Specialist with Sanoh America, a manufacturer of tubing, fuel injection rails, and other fluid handling devices for the automotive industry. We also heard from their systems integration partner, Kors Engineering. Sanoh’s story is a typical Plex customer story that has early successes with Plex and then grows the use of the solution to other processes.
Sanoh had a problem with miscounts on racks of parts being sent to their biggest automotive OEM customer. Several times each year, they would send a rack that was short, e.g. 29 parts instead of the expected 30. They tried solving it in a number of ways, including using a third party to recount the shipments, or putting sensors on the racks. Each approach had its own problems. Finally they decided to directly read the data off the PLC10 on their production equipment which counted how many parts were being produced, and how many were rejected to be sent for rework or scrap. By going down to the machine level to keep track, they were able to reduce the number of miscounts from eight in 2012 to five in 2013, to none since October 2013. This renewed the OEM’s confidence in Sanoh. It also gave them added intelligence on scrap, capturing the accurate amount, reason, and costs of scrap.
Monitoring Downtime
After that success, they asked themselves what else they could do, and saw an opportunity in collecting more accurate data on machine downtime. Machine operators were supposed to enter data about when and why any machine was down. Some operators were diligent in recording accurately, but many would not bother to record the downtime if they figured they could just fix something quickly anyway. So Sanoh decided to read data directly from the machines, which have sensors to detect when something is going wrong. The machines then generate a problem code on the reasons for a shutdown (like ‘no raw material’). Now the machines communicate that data directly to Plex. The company knows the exact time each machine goes down and when it comes back up, down to the second. Plant managers can pull up workcenter logs and see what it is actually happening on the machines, instead of relying on operators to enter data reliably.
Going Forward, OEE and More
Plex licensing philosophy of unlimited seats also allows unlimited plant floor machines to be hooked to the system without increasing the license fees. This allowed Sanoh many possibilities for further integration of their shop floor machines with Plex. They implemented a Kanban system using machine data to tell the operator when and what to produce. Now they have the ability to run on either a job system or Kanban.
All this happened in less than a year. Everything so far has been done by retrofitting existing equipment, by interpreting what someone else wrote in the PLC code. Now they are working with their tool providers so that all of the new equipment will have all their requirements. This includes an OEE11 display right there at the workcenter. They will take quality/scrap, availability/down-time, and operator performance data and produce an overall effectiveness metric right at the machine, so the operator gets instant feedback to directly see how they are performing. It will include color coded performance indicators-green, yellow, red — for each metric.
They are also installing vision systems to monitor production of brake and fuel lines to count the number of parts on a rack — another way of ensuring accuracy. In addition, they are recording every time an operator pushes the emergency stop button so that a quality engineer can investigate. In addition, they have installed a fingerprint scanner on some machines, so that only the supervisor can unlock and bring up a machine that is locked due to a failed validation. Previously a busy supervisor might share their keys or codes with some operators, which enabled them to bypass the system. Down the road, Sanoh plans to take quality data directly from the machines and put it into Plex check sheets, instead of relying on the operator to check everything off. Human nature is to avoid entering failures in the check sheet. Now that data will come straight off the PLC.
Change Management Required — The People Part of the Equation
As you might imagine, there was some change management required for the people involved. At first production managers and workers really disliked the new system, as they were used to gaming the system. But they soon discovered that by using that data, it became very clear where the opportunities were, so they could work on making improvements. For example, their benders need to be gauged after every 60 bends to ensure accuracy. The production managers were shocked at how much (previously unreported) downtime there was from machines waiting to be gauged; literally sitting for hours. This gave production managers the data they needed to consider how to reduce the down time. Providing this kind of data changes the way people work and solve problems.
Another challenge, at first, was getting top management to understand the ROI they would realize from the investment in instrumenting. But once they saw how the company eliminated short-to-container mistakes, got accurate scrap data to help reduce scrap, and accurate downtime data to help reduce downtime, then the management team became very supportive.
Benefits of Integrating the Shop Floor into Plex
Capturing data directly, instead of asking machine operators to key it in, has helped to maximize the time operators can “keep their gloves on” for the actual work and reduces the number of PCs needed on the plant floor. It increases efficiency (less operator time on non-value-add tasks) and transparency with more accurate and granular data. Furthermore, as soon as something is outside tolerance, the system can inhibit the equipment and present information that something needs to be addressed, enabling immediate action to be taken. Sanoh has found this is an effective selling point with their customers. They are able to say “Our machines won’t even let us make out of tolerance parts.” Connecting the shop floor to Plex has thereby been able to have a positive impact on not only efficiency and quality, but also on customer sales.
Conclusions
Plex has stayed true to their manufacturing roots, maintaining a focus that is critical for effective growth. Their continuous innovation SaaS model has proven to be attractive for the small to mid-sized manufacturer that wants to keep up with the latest technology, but does not want to make big investments in IT headcount or data centers and equipment. Now Plex is also going after the larger manufacturers. We often talk about how small and mid-sized companies have the same needs as their larger brethren, but in the past have not had access to those sophisticated enterprise solutions. Plex is giving them those capabilities to compete and realize continuous improvement from technology. In fact, Plex can rightfully say they are doing their part in contributing to the revitalization of manufacturing in the U.S. and beyond.
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1 Example of investments in the manufacturing sector About The Right Place, Inc. The Right Place, Inc. is a regional non-profit economic development organization founded in 1985 and supported through investments from the private and public sector. Its mission is to promote economic growth in the areas of quality employment, productivity and technology in West Michigan by developing jobs through leading business retention, expansion and attraction efforts. For more information visit: www.rightplace.org — Return to article text above
2 In the next issue, we will have a whole article focused on UI implementation challenges. — Return to article text above
3 Too bad there was not a cloud player to partner here. The Plex user base is so appropriate for APS. And Plex is a great company to work with. — Return to article text above
4 For on premise software, the solution provider’s support team has the additional challenge of solving bugs they can’t replicate; bugs that manifest only on the customer’s specific configuration, with the customer’s specific data. This can be very expensive and time-consuming. — Return to article text above
5 You can read about some of these in Plex- Founding Fathers of the Cloud Revolution — Return to article text above
6 Customers can turn on whatever functionality they are entitled to, at their will. — Return to article text above
7 The sandbox data is generally about a day old, so it is not up-to-the-minute, but is recent enough to provide a very authentic test bed (i.e. very nearly identical to the production setup). — Return to article text above
8 In a small company, where they might not even have a dedicated IT person, there might be just one product champion. In larger organizations, there are usually several product champions (i.e. business analysts), typically for each functional area (finance, supply chain, plant floor, etc.) who keep track of new functionality in their area. — Return to article text above
9 Plex said they get immediate feedback from customers whenever they put something out and can do an immediate fix to everyone’s code. — Return to article text above
10 PLC = a Programmable Logic Controller, which is a computer used to control the movements and settings of the production machinery. — Return to article text above
11 OEE = Overall Equipment Effectiveness, a widely used set of metrics measuring the effectiveness of a manufacturing operation. — Return to article text above
To view other articles from this issue of the brief, click here.