IQMS this week released a version of its flagship ERP product, EnterpriseIQ, packaged specifically for single-site manufacturers and small supply chain environments.
EnterpriseIQ Limited Edition (LE) provides the same core capabilities found in the full version but contains only the features most often used by manufacturers with single-plant operations. For a lower licensing cost, manufacturers get a suite of applications that includes inventory control, quality management, sales and distribution, production monitoring and reporting, and accounting, company officials said.
"To be competitive and grow, small manufacturers need the same visibility and control over core business data that large-scale manufacturers enjoy, but more often than not small companies cannot afford large ERP investments," IQMS president and founder Randy Flamm said in a statement.
In a recent report titled "U.S. SMB IT Spending Profile, 2006-2007," AMR Research analysts Fenella Sirkisoon and Colin Masson found that in order to compete with larger enterprises, small and mid-size manufacturers in the U.S. plan to ramp up their information technology investments in an effort to better utilize internal information as well as electronic collaboration with customers and suppliers. A related survey of 487 manufacturing and service companies with less than $1 billion in revenue found that the major influence behind increasing investments in 2007 — both in IT initiatives overall and in enterprise software in particular — is the pervasive need to better understand market trends and customer behavior. Among other factors are ongoing efforts to implement cost-saving lean practices.
"We try and sell people what they need," IQMS director of marketing Daniele Fresca said in an interview. The full version of EnterpriseIQ has extras that smaller-sized customers were hesitant to use because of all their bells and whistles, Fresca said. "With LE they can ease into an ERP package."
"[Smaller manufacturers] need a starter system that's not too complicated, that lets them walk before they run," added Glenn Nowak, IQMS's vice president of sales.
Nowak said that three customers are currently using LE, including a plastic injection molding manufacturer and a medical device maker with less than $10 million in revenue. All three are coming straight from spreadsheet-based accounting systems to LE as their first enterprise software installation.
Fresca noted that LE is designed to scale up with optional modules that work seamlessly within the core system. For example, IQMS eServer, an EDI module that automates process monitoring for companies handling several hundred transactions a day, is optional on the LE ERP system.
IQMS also offers a migration path from LE to the full version of EnterpriseIQ for companies that eventually grow into multiple locations. If and when customers are ready to upgrade to the full version, company officials said, the change would not require a "massive reinstallation" or repurchase, because a lot of the customer's data would already reside in the core system.
"The business requirements of small and mid-size companies aren't that different" from those of their larger counterparts, Nowak said. The distinction mainly involves how much functionality they need right away, he said. Without providing specific pricing details for LE, Fresca said that software and implementation costs are about 25% less than those for the full version. She said that because IQMS's products are based on a single source code, training and implementation costs generally amount to 30%-40% of the cost of the software itself, versus the more typical 1:1 ratio found in multiple-source installations.
The company also said that manufacturers that choose LE can cut implementation time to three to six months. (One particularly efficient customer, officials said, was up and running with a full ERP implementation, including machine monitoring functionality, in just six weeks.) A full-scale enterprise software implementation with larger ERP packages, by contrast, can take double that time or more.
The release of EnterpriseIQ LE, which follows a point release of the full version of EnterpriseIQ suite last month, comes at the conclusion of a successful year for IQMS. The company reported a 27% increase in revenue in 2006 over the prior year and a 15% growth in its customer base, which consists largely of automotive, CPG, and medical device manufacturers. Sales of additional licenses and modules to existing customers also grew by 20%.