>> Announcer: Live from Boston, Massachusetts, it's theCUBE. Covering IFS World Conference 2019. Brought to you by IFS. >> Welcome back to Boston everybody, you're watching theCUBE, the leader in live tech coverage. My name is Dave Vellante, I'm here with my co-host Paul Gillin. This is IFS World Conference 2019, theCUBE's second year covering this conference. Michael Ouissi is here. He's the Chief Customer Officer at IFS. And Raul Sahas. Industry Partner, Enterprise Application Services at TCS, a platinum partner at IFS World. Gents, welcome to theCUBE. >> Thank you. >> Thank you for having us. >> You're very welcome. So last night I poked around the customer event and I was impressed with the number of partners here. I think the number is 400, is the public number. What is it about the ecosystem that's attracted to IFS? >> Well, first of all, I think the ecosystem has now understood that we have renewed our commitment to the ecosystem. That is something a shift in mindset in IFS that is demanded by our customers, that our customers actually ask of us especially while we're moving into also more global corporations, and win more business there. They appreciate the choice of either IFS or our partners, or a combination of our partners and IFS actually helping them deliver the value that they expect from an ERP solution. >> So Rahul, from your perspective, so TCS you're obviously platinum partner so you're making a big investment. Why, what's happening in the market place? Where's the momentum with the tailwind? >> If you look at TCS, TCS is obviously helping customers to become business 4.0 organization, which is all about harnessing the abundance of possibilities around digital technologies and getting more intelligent, better, lean, harmonized, standardized. And so that's where we believe we are partnering with, and we are trying to leverage the ecosystem and one of the ecosystem obviously partners are IFS, which is a strategy partnership for us. And we believe that the investments that IFS has made and some of the unique last-mile solutions are going to help us to deliver those different shaded offerings to the customer, and create newer partnerships with them. >> Michael your role is a net new role at IFS, did you get to write your own job description? I guess, what does a Chief Customer Officer do? >> Well, first of all, well, in a sense yes. We actually did specify exactly what that role is, and we did discuss what the best is for the journey we want to get on, when Darren asked me to take on the role. And what a Chief Customer Officer does, and there's a specific reason why we're doing it that way, a Chief Customer Officer really is heading up, and that's what I'm doing, is I'm heading up all customer-facing functions within IFS. So from sales, to pre-sales, to support, to services. So it's all the customer-facing functions, coming from how do we engage with a customer, pre-sales, and after sales. And the reason why we did it that way is we wanted to have complete ownership and accountability for the transformation that we underwent and that we wanted to go through because we really needed to make sure that all parts of the business were aligning around this transformation, and pulling in the same direction. And that's why this role got created newly. >> So what's the nature of the partnership, what the history of the partnership? How did it start, and where do you guys want to take it? >> Well I think we have a obviously longstanding partnership with IFS. And I think both of the organizations have a deep mutual respect. And I think that one thing that we are trying to see the centricity around our partnership is all about the customer. We keep the customer and we want to ensure that we help our customers. We're customer-first organizations. And obviously the investments that IFS made, especially in the field services area, ERP area. I guess those are the areas which is helping, because ERP, if you see, one of the strategic lever for an organization to elevate their digital agenda, and get the right infrastructure in place, the right partner in place, to ensure that they create a differentiation and create exponential value for the customer. And that's exactly where IFS and TCS are looking at the market, and ensuring that we are helping our customer create exponential value for themselves in the market. >> Michael: Yeah and I think that maybe adding to that, we share the same belief as well that actually the time of the monolithic ERP, one solution for a huge enterprise- >> Who are you talking about? (Laughter) >> They are gone, those days are gone. I think it's about blended solutions where the ERP is much more agile, it has to be much more open and allow for much more agile deployments and much more agile development around the core ERP. So that actually customers can digitally transform, because it's all about speed. And TCS sees it the same way so we've got the same view. >> But the cloud mindset has changed that right Paul? >> Absolutely. And Rahul I'm interested the companies like Tata historically have done a lot of custom development work for customers that we have been hearing from Darren on down today is no customization. What value do you add to a customer bringing in an IFS solution? >> See there are two things here, very simple. One is basically customers are moving from best in class to the sub-breed, that's quite evident. And secondly, while IFS brings the software expertise, we bring the industry expertise. We bring the domain expertise. We bring the SI, system integration expertise. And that's where, it's a very strategic combination. Strategic combination is helping the customer to get the right software, the right domain expertise, the right industry expertise. And together they're helping them to address their business requirements, business need, and last mile critical mile needs that they need to differentiate themselves in the marketplace. And, as a result, create exponential value, and also, a great customer experience for the customers. >> Paul: So, how does that engage and differ from a more traditional one where you would come in and you would build custom screens and custom processes? You're not doing that. Now, what does that relationship look like? >> Yeah so I think if you see the scratch approach, obviously it has really transformed over the course of time. Customers are wanting off the shelf, out of the box products. Best of the beat products to help them differentiate their business function, create exponential value for the customer for that business function as a matter of say, service. If I look at fin services as an example, and you talk about telcos, you talk about utilities. Where last mile delivery, last mile solution for that customer is very very important to create the positive customer experience. And the investments that IFS have made in there makes them a premium choice. And that's where I believe that developing something with scratch means you know you're boarding the entire ocean again. And whereas we have got softwares like, IFS build softwares which have invested their years of expertise, the years of, I would say, competency in building that. Getting the best of the breed solution, get the best KPIs into there in this solution, gives the customer a choice. A ready choice to take, to expedite their time to reality, time to value, and time to production reality. >> So, a few times now, Raoul, you've mentioned last mile solutions. I like that term, I think it has meaning. Especially deep in specific industries. And I think the intent is so that you don't have to do customizations. And I asked Aaron about tailoring, which he said, I wouldn't use that word. That wasn't my word, by the way, that was Christian's word. He used that in his keynote. So I'm trying to understand here. I think what Christian meant is look, we got this API platform to allow people to bring in whatever solutions they want, if it's a RPA solution, or a blockchain solution, or some AI module, they can bring that in and tailor it for their needs, as opposed to customizing the software. Is that correct? >> I think when you listen to Darren, what he's talking about is customizing the core, which very often has happened in the past, where customizations have gone into the core, have been mandated to be on the core platform, which then actually has customers being stuck at some stage on the platform upgrades becoming paid for. So with Christian's talk track around the APIs, API enabling the whole solution so that the core actually remains untouched. There will always be customizations, because customers need to differentiate. But they will be outside the core. There will be a level that you can upgrade the core solutions, you will have those maintained either application services, which will be custom out of the box solutions, best in breed, that actually tap into what we're doing. Or actually you'll have bespoke solutions that you will write yourself, and that is then a choice a customer can make, but without actually having the pain of not being able to upgrade the very stable, very performant transactional backbone. >> So the API announcements give you guys a real opportunity to do integrations, right? And it's been harder to do integrations. But that now, to your previous question, opens up I would think a whole new tam for you all. Can you comment? >> Oh absolutely. As I said, bringing exponential value means integrating and delivering a frictionless business. And that's where it'll fit in, rightly fit in, and obviously that would result in creating exponential value for the customer. Not only they can differentiate themselves from the market but also get their product faster to the market, and ensure that also focus on custom centers as we are. >> So the core can be, it should be, Evergreen. We want people to get the new version as soon as possible. Bug fixes, security updates, et cetera. >> New functionality. >> New functionality, avoid custom mods, but rely on service providers and partners to do further integrations that make sense. >> Rahul, I want to ask you the same question we just asked Melissa Di Donato about digital transformation. I'm sure your company does a lot of that kind of consulting work. What are the mistakes that companies make that we hear that these transformation products, most of them fail. What are the biggest mistakes that companies make? >> Let me put it this way. I think there are three elements to it. I think digital transformation, see I think creating the agenda for the digital transformation, what you're expecting out of it is very very important. Creating a charter, what you want to expect, what is the output of it. Where do you want to take it. What does a futuristic organization on a digital platform means? It's very very important. I think if you look at TCS, our vision has been helping the customer get into a business 4.0 enterprise. I think we have made the agenda very very very clear. Now how we can mass personalize the experience for the customer, how you can leverage the ecosystem, how you can basically help the customer embrace the risk, and obviously harness the abundance. I believe these are the pillars of any transformation, or digital transformation, that customers are taking. I believe if we can stick to these agendas, I think getting to the production reality, seeing the success has become more evident. If you're going to go to the nitty gritty, I think there are many things, looking at the processes, making sure that they are harmonized, standardized and rationalized, getting the right KPIs in the business. So I think these are things that is very very important as a precursor to our digital transformation. Once we do that, we know that roads ahead will be much smoother than what it looks like. >> Is it more important to do a transformation with the customer at the center, with operational efficiency at the center, or can it be either? >> The customer centricity is very very key to all our organization at this point of time, because if you look at any organization at this point of time, they're looking at the customer experience as the top most agenda. Keeping the customer experience on the agenda, when you're trying to keep that agenda, it means that you are trying to bring up a customer first organization. So customer first organization, it just doesn't mean that you have a very intelligent front office, but also have a very intelligent back office. And gluing this two together, very intelligent mid office. So I guess customer centricity has to be on the top of the agenda, and then you have to ensure that your processes are streamlined, harmonized, standardized, lean, to meet that objective. >> Makes sense. >> So I think, for customer centricity, so I feel as though, but part of that's cultural, you know? And it's true, you said this earlier this morning. Some companies are customer centrics, some are product centric, some are competitive. And you can kind of tell the difference, especially when you're a customer. But I think true customer centricity mandates data access as central to the philosophy, the core. And I think the role that ERP provider or vendor provides is you have a data pipeline that gives access to an organization such that a digital transformation allows them to put data at their core, and then build whatever processes around it. I think that's a real challenge for incumbents especially where data's all over the place, in different stove pipes and silos. But your thoughts on the role of data in terms of digital transformation, and IFS's role in that regard? >> Okay. >> A long-winded question, but I haven't heard enough about data I guess. >> Okay, (laughs) I'll try it, sweet and short. I think data is absolutely key to anything we do. Once you have and when you go into a digital transformation, what you need to start with in my humble view is you need to start with what business outcome do you want to achieve? Most of the time it's customer centricity, it's something centered around the customer which you want to achieve. That will define both the digital transformation agenda, the KPI's you're measuring to, but also the flow of data and processes. So you will need to build your digital transformation agenda around the targets you have, and then define where does data need to reside, which data do I need to fulfill on that outcome? And I think that consistency going through that whole chain is actually something that very often isn't at the moment taken into account, but it's very often isolated efforts to do something fast without actually looking at the implications of what kind of transactional engine do I need, what kind of data exits do I need, and how do I get through the process to the KPI that I want to influence? >> Okay, and let me peel the onion on that, and I'd love for your thoughts. To me when you talk to a C-suite executive, what that business outcome ultimately comes down to is I want to increase revenue, so I want to cut my cost. Now of course if you're in a different hospital, you want to save lives. But generally in a commercial business, increase revenue, cut cost. Now how I get there, I might want to have a better customer service organization to get cohort sales or follow on sales. I mean the strategy is different. But it comes back to data and how data affects the monetization of my organization, whether it's increasing revenue or cutting cost. Do you buy that premise, or am I just simplifying it too much? >> No, completely agreed. I think in a business world it's always either top line or bottom line, but the challenges are obviously very different from company to company and from industry to industry. So if you're looking at manufacturing companies, trying to actually be less commoditized and getting into a situation where they stabilize revenue streams, increase margins, servitization is the name of the game. Very different value proposition to, for example in the finance industry, in banking and insurance. So there are very different models here where there it's about ease of use and speed of actually interacting and transacting as a customer with the company. So very different value propositions, very different data streams you need to tap into. And things you need to know about your customer, and know about the service you're providing. So completely agree with it is always about revenue and cost, that's what businesses are in for. But eventually, data is at the core, but how to get that data, which data you need, that is then specific to each. >> And bringing it back to IFS, your ability to go that last mile as you've been saying Rahul allows companies to think, construction and engineering, supply chain, contractors, just more efficiently managing their ecosystem, their resources to either cut costs or do more business and scale. >> Exactly. And that's really where the whole idea of API, enabling the whole suite came from, enabling the reuse of services, the reuse of data within those services, exposing it transparently, making it available for customers to then use in their digital transformation effort. Whatever they need. We can't predict and we can't actually preempt what a customer will need, we'll just need to make it all available, and then with partners like TCS, make sure we actually go on to the right journey with a customer to digitally transform and use the right data streams. We can make it easy and accessible. >> And that's the different between a platform and a product. To the extent that you can deliver an API-enabled system, it becomes a platform that you can evolve versus a product that you install and manage. Final thoughts, Rahul? >> I think what we discussed obviously, I fully agree on that. And as I mentioned that our take is to ensure that we have the customer built future systems enterprises, and we believe our partnership with IFS is a very key and strategic partnership for us to achieve the same, and we have some early success, and we want to ensure that we scale that, we ensure we go to the market together, and create a differentiation for our customers. >> Michael, your thoughts. Where do you want to see this ecosystem go? >> Where do I want to see it go? Well I want to see it thrive. I want partners to be successful with their customers on IFS implementations. That's what our ambition is. We need to provide world class technology, a world class platform, as you said, that actually then can be used to help the digital transformation that all our customers will have to go through in one or the other way. >> Success is outcome driven. Good outcomes mean people come back, more business? >> Absolutely, absolutely. >> Exactly. >> That's core to our DNA, I'm sure core to DNA to IFS as well. Repeat customers. >> Congratulations on the partnerships, and good luck going forward. >> Thank you very much. >> Appreciate you coming on theCUBE, you're welcome. >> Thank you very much. >> Thank you. >> All right thank you for watching everybody, we'll be right back with our next guest, Paul Gillan and Dave Vellante. You're watching theCUBE. (electronic jingle)

>> Announcer: Live from Boston, Massachusetts, it's theCUBE! Covering IFS World Conference 2019. Brought to you by IFS. >> Welcome back to Boston, everybody. This is Dave Vellante with my cohost Paul Gillin. We're winding down day one of the IFS Conference, the World Conference here at the Hynes Auditorium in Boston. Paul Helms is here as the senior vice president of customer success at IFS, something that we've been talking about a lot, and Stefano Mattiello who's the senior vice president and the global head of consulting, also from IFS. Gentlemen, welcome to theCUBE. >> Thank you. >> Thank you very much. >> All right, Paul, let me start with you. So, kind of a loaded question. How do you define customer success? >> It's a question I get very often, and customer success, you can make out of it what you want to. The way IFS looks at it, it's not only me but IFS look at it is, how do we take our involvement into our customer's business outcomes beyond the go live. Okay, so, they buy software, they implement the software, they go live, and then what? So customer success is really looking into what is the quality of the relationship we have with our customers, and how deep and how integrated we are in that relationship. Understanding what success means to our customers because it's different for every customer. And then how do we back this up with the quality of service to really build that success and mine the value that is in the solution to the benefit of our customers. So it's this long-term relationship driven by business outcomes, that is customer success. So, historically in the software business success was defined as we're live. You know, service now bakes a cake, hey, success. That's not how you guys are defining success. >> No, I mean, it goes way beyond the go live. In fact, I mean we're talking about success as actually starting even before the implementation even starts, which is capturing what success means to that particular customer. In your business situation, what does success mean? Feed that in, we obviously want to get the customer live as quickly as possible, it's the time to value, and that talks to ROI. But that's just the beginning of the game, that's not the end of the game. So it's about what are we doing after the go live phase, what are the interventions that we're running in aid, delivering on that promise that we made right up front that says what does success mean, let's make sure that we deliver on that. But then more importantly is how do we kind of maximize that success. As the market dynamics are changing, as there's more pressure coming on your business, your business is changing, right? So how do we evolve your business model because success today might have a particular shape and a particular color, but in nine months or 12 months time it'll change, it'll morph into something else, so it has a different definition. So it's about that lifelong engagement, you know, how do we keep redefining success? >> So what stage does this success discussion begin? >> It's very much as I said in the early stages of what we would call the pre-sale cycle. So when we first start talking to a customer, is we really want to understand what are your business imperatives. All right, let's try to capture that. It's fundamental that we're not just selling technology for the sake of technology, but we're there to drive a business agenda. So it's really as early as we can do it, I think that's where we can capture and maximize the delivery of that success. What does it really look like? So, the sooner we do it, the better. >> And also looping that actually back into what do we see in our customers and the way they use the software and the way their business is changing in their environment, so to say, and bringing this back all the way into the product, okay. And how do we shape the roadmap of the product using the insights into how customers are being successful using our products. So, we are not there yet, but that is the ultimate goal, that we will build better products based on our customer success insights, and then turning this into a mature cycle to really drive and maximize customer value over their lifecycle. So it goes beyond just the service, it really is all the way back into the product, how that adds value, how do we deliver this, and all the way back again. >> And I always argue, I mean, unless you're sort of a nonprofit or, you know, if you're a hospital, you want to save lives, but if you're a for-profit company you want to increase revenue, you want to cut costs, you want to drop money to the bottom line, you want to rip the face off your competitors, and you want to do some good for your community. So I mean, you can take all these other factors whether it's better customer satisfaction, better productivity, et cetera, and it usually boils down to those things. Is that fair? >> Yeah, I mean, that's pretty much, you know, those are your business imperatives, yeah, that's what success looks like to you. But it's an iterative process, right. So what I was saying earlier is it doesn't start and stop there. I mean, things will change and the approach we want to take is let's not just do it once, let's keep revisiting this because once you've captured those objectives and you're actually on top of those, or you think you're on top of those, then as we improve the product, as the market dynamics change, then you'll have different priorities. So let's keep revisiting. And the way we're looking at it is a project is no longer just the start and a stop, single-time event, it's an iterative process. >> Are you seeing priorities change, or maybe you don't have enough data to speak to this, but we saw 160 CEOs recently signed a petition, or a proclamation, if you will, that it's not all just about shareholders, there are multiple stakeholders they have. Are you seeing priorities with customers change over time? >> I think when, the conversations are changing, so when we talk about 10 years ago probably you talk about optimization, it was purely for getting more bang for your buck. So, how do I take cost out? How do I become more efficient, more effective? The conversation is changing now to how do I become more sustainable? You still need to optimize. You still need to deliver better and operate better. But it's not only for profit, it's also on how do I become more sustainable, how do I leave an environment for the youngsters in my company, that they still have a company by the time that they are at our age. (laughs) >> Benny often is very outspoken about that. >> Yes, he is. >> As you know, I'm just waiting for the day when the CEO misses three or four quarters in a row and says, "Yeah, but we're doing all this "great tech for good." But I do agree. Especially with millennials coming into the workforce, they want to see that their companies are doing good, they're giving back to the community and paying it forward. Question on swim lanes, you got I think 400 partners. What are the swim lanes between the services that you provide and your partners provide, and what's the overlap there? >> So this is the transition that we're in at the moment, is that historically IFS was trying to be an all things to all customers, right, so we'll do everything from A to Z. What we're doing now is we're saying, well, let us focus on what we do best which is our product. That's really what we do best. So what we want to do is we want to try and help the ecosystem, we want to help our partners in driving those efficiencies and actually implement as quickly as possible and drive value for our customers. So what we're doing is we're now moving into a position where we say, let us rather drive a value assurance discussion with our customers, let's safeguard projects, so we're working in a symbiotic relationship with partners, we're not competing with them, right. So we know what we do, we know what they do. >> So you have some new services, IFS Select, IFS Success, IFS tools and methodologies. So, there's knowledge transfer then between you guys and your partners, is that right? How does that work? I mean, this takes investment, it's got to be more than just a press release obviously. >> Yeah, yeah. We want our partners to know everything that we know, and we're a software company, we're not a services company, and we don't want to compete in the services space. We want to use services to enable software, and more software, because the faster we grow our software business the better for us as a company 'cause that is our core business. So there's no competition with partners. We want to share what we know. We put in tools and methodologies. We standardize knowledge. We share knowledge, we bring this out. We put our partners through the same training we put our own people, there's no secret little room back there where we give them the real stuff, (laughs) our own people. So we are very open with knowledge and experience and sharing them, and helping them enabling this. So we will work with a partner to say, okay, the first ones that you do you might not be that confident so let's be there in a more intense way, and as you go along and you build your confidence and you build your competence we can take a step back. And therefore we can still ensure quality for our customers while scaling through the ecosystem. So this is, you know, it sounds strange, but we really do not want to do the services business. We want to do the services business that we have to do, not as much as we can do. >> And I mean, just picking up on that as well, is it's not only about enablement, we're actually actively sharing our tools and methodologies with our partners. So whatever we use ourselves we're making available to our partners. And that's fundamental, right? That's exactly what Paul says, is we want the partners to do exactly what we're doing, to the same level of quality and the same standard. >> And we have a stated vision that says that the customer experience should not differ whether they use IFS as their partner or they use a service provider as partner in their journey because it's about the experience around the product, not around the service, that should make the difference for them. >> I think you have a dog fooding booth here. I call it dog fooding, I know that's kind of a pejorative, but you know, your champagne, drink your own champagne, but, you know, IFS runs IFS. It's sort of a big theme here. >> Right behind us. >> So you guys have implemented, and this is what you're talking about, the tools and methodologies you use for your own business. What have you seen in your own business? What kind of business impact has IFS had on your business? (guests laugh) >> So we implemented our own, as you say, we drank our own champagne within six months. We came from an environment which was quite disparate, historically speaking. Many different systems in different locations and regions, and we brought this and consolidated this into a global template. This was hard. Harder than we probably thought it was going to be. Not technology-wise. Technology-wise it was, yeah, technology is what technology is, but from a change management point of view, and from a impact to the business, and to people's daily operations it was bigger than you thought. So that's a learning, we've captured this in our lessons learned. We have made some changes and brought in some new tools and methodologies and insights that we will share with our partners. But if you would now look at afterwards we're live, the impact it has on our business, it's transformational. It is giving us insights which we never had before. Given the efficiencies which we never had before. It opens up new things that we consider as doing as business and operating as a business which we never had before. So, yes, was it hard? Yeah, it was hard, that's not-- >> What were you transitioning from? >> All sorts. (laughs) >> So we had a-- >> One of everything? >> Yeah, I mean we literally had a cluster of independent systems that had all been modified, and I think this is another point, is that the historical approach to a lot of ERP installations is tell me what you want and I'll develop it for you, right? And even-- >> A lot of snowflakes. >> Yeah, exactly, and even if it means that we're actually going to build a square wheel, which is not, you know, not the best model, but that's what you want, so we're going to give you that. Whereas the approach we're taking now is, you know what, we've got enough capability and standard functionality from all of the years of experience that we have, go with kind of best, you know, best-in-breed approach. It's more than enough than what you need and it'll give you that ability to switch it on and go live and run with it immediately, rather than customizing it and spending three years and trying to get that square wheel, which is actually not what you really need. >> That seems to be the karma at the company, we've been hearing that all day about the value of not customizing. >> Correct, exactly. >> And the product itself and our solutions are very rich and we take this one step further and say, well actually, how can we get our customers to adopt quicker depending on the industry that they are in because we have to accept that the way you do a certain thing in one industry is not exactly the same as its best practice in another industry, for very good reason. So there's differentiation on how processes live in different industries. So, Stefano and team has been very busy building what we call the accelerators, and how do we bring those industry best practices together in two things, one is as a quick start. So, you know, here it is just use it and run with it and you're up and running in a very quick way. So that's our knowledge and experience that we share and we make it available through our partners as well. And secondly, it will allow us to keep that up to date as sort of the reference architecture for your industry to, as you go forward, you might, you know, be going one way with your implementation, we say this is industry best practice, and how do you derive value between the gap by adopting the gap between what is standard best practice and what you have in your solution. So, driving that value over the lifecycle as part of the success engagement. >> So you guys are senior executives at a global company, you talk to a lot of customers, so I wonder if I could get your take on sort of the macro from a spending standpoint. I mean, we see in the US, we're in the 10th year of a boom cycle. The IPO market here is kind of, the window's closed, I think at least for now, and Wall Street's rewarding growth, they don't care if you make profits. You know, things like cash flow, EBITDA, (laughs) they don't seem to matter. And so that's been going on now for the better part of a decade. When you look at Europe, it looks like it's softening, it's kind of overbanked, financial services, and no, you're exposed in financial services, certainly not in a big way. But, so what are you seeing across the globe just in terms of spending on tech and what does it mean for your business? I mean, you're a share gainer, you're taking share, so you should be somewhat insulated from any kind of flattening or softening, even though the softening is not precipitous. But I'm just wondering if you guys could give us your kind of anecdotal take on what's going on in the marketplace? >> You answer that? >> No, go for it. >> So I think, two things that we see happening. We see many more new customers coming on with us. So you saw this morning as well in the keynote, more than 50% of our revenue comes from net new customers to IFS. That is amazing. There's not another similar company that can claim that. We're outgrowing the market by more than three times the average. But that's one part of the story, the install base is the other part of the story. So the install base, what we see there is they are spending on the digital transformation, on getting ahead in their game. Tech is disrupting a lot of industries and it's enabling a lot of disruptors to enter markets that previously, and industries that previously were closed to them. In financial services you see that a lot, but also in the other industries, we see these young and upcoming disruptors coming. So, we see a lot of people and companies investing into the digital transformation, opening up new channels, opening up new markets that were not there before, but now with tech, and the tech that is available, is there. At the same time they need to create space in an investment, you know, nobody has unlimited resources. So they're looking at optimizing what they have so that they can free up some cash and capital to invest into some of these disruptive things. So it's really an exciting time to be part of the industry and really exciting time to be part of a challenging and a challenger company like IFS that really goes out and focuses on its industries, focuses on its tech stack where it matters. We're not trying to be everything to all men all of the time. We're really going after what we know we are good at and I think the numbers show for themselves that's-- >> Half of the transactions are new adoption of IFS, right? That's enormous. >> Paul Gillin: Capital license revenue. >> Paul Helms: That's from our license revenue. >> Okay, yeah. I mean unless there's a huge proportion leaving your install base which it doesn't sound like that's happening, that if people are just even spending flat with you guys it's a growth story. >> It's very, I mean, my opinion is it's all about choice. Customers want choice. They want an alternative, right? And what I think we're doing right, well at least, what I like to think we're doing right, is that we focused on business outcomes. That's really what it's about. We're talking their language, talking to their agenda, and we're giving them an alternative. >> And we're not forcing them to go into the cloud. We give them the option to go into the cloud if they want to, but they can also stay on-premise. We don't force them to go subscription model. The option is there, but they can also choose full perpetual. So it's really about giving them choice, talking to the customer business outcomes, and engaging in a really customer-centric and customer-intimate way along their journey. And it's working. >> So given the success you're having in, specifically in Europe, how do you feel about your ability to export that success to North America? >> Well, we're doing that already, I mean it's happening, and we're seeing growth globally, right? Yes, I mean, in certain regions it's accentuated and larger but there definitely is, it's a global phenomenon, we are seeing that. And I think a lot of it is also coming back to our focus. And I think you made the point to this, we're not trying to be all things to all people. Where we focus, that's where we really excel. So, the kind of answer to your question is less about the geography, is it more about the industry, is that what you want to focus on regardless of where they are? That's the approach we're taking. >> And also the capabilities we're bringing into the field. So there's management, has been a very healthy growth area for us. You saw this morning, again, we just announced the acquisition of Astea that will further enhance our capabilities in this place, they're really a leader in what they're doing. So that level of focus makes us win in our industry and our marketplace. >> I mean, that looks like a good acquisition. That starts to lever a relatively small company but, and you picked it up from what I can tell pretty cheaply, but the impact to your business is significant. So, that's good, congratulations. All right, gents, I know we're probably keeping you from important customer dinners and touring Boston, so thanks very much for coming on theCUBE, It was great to have you, we really appreciate it. >> Thank you. >> Thank you very much for having us. >> All right, thank you for watching. Paul, it's great working with you, and that's a wrap here. >> As always, Dave. >> From IFS World in Boston, and this is theCUBE. Go to siliconangle.com for all the news. Go to thecube.net for all these videos. And we'll see you next time. (futuristic music)

>>live from Boston, Massachusetts. It's the Q covering I. F s World Conference 2019. Brought to you by I. F. S. >>We're back at the Hynes Convention Center in Boston. This is a cube, the leader in live tech coverage. And this is our coverage of I f s World 2019 Matt Smith. This year. He's a global chief architect. Paul Dylan and I are happy to have you on Matt. Great >>pleasure to be here. Thanks very much. >>Filing. You're welcome. So business value engineering is a concept that you're a fan of on one that you've sort of promoted and evolved. What is business value? Engineering. >>So business value engineering is quite a common term in the industry, but here I affects it's a little different. Fundamentally, it's, ah, collaborative process that we use working with our customers on our partners to make sure that what we do with those customers delivers financial value to their business. So it's fundamentally about making sure what we deliver delivers value. >>So I wanna ask you a question about this because your philosophy is a company seems to be the Let the customer define value. Um, it's in their terms, not your terms, not trying to impose a value equation on them. At the same time, it's nice to be able to compare across companies or industries and firm level on DSO forth. So how do you reconcile that? Is it like balanced Scorecard is sort of pay you can tailor to yourself versus some kind of rigid methodology. How do you How do those two worlds meet in >>TV? Yes, so obviously, benchmarking across industry is really important. And there are lots of people that do that kind of work, and that's part of business value engineering. Fundamentally, it's about mutual collaboration. So it's not just about using the customers framework or that all their language is about agreeing the language. One of the challenges when you're trying to build a business relationship with with one or more parties is you have to have a common shared understanding, a common vision on a common value system so that when I say something to you, it means the same thing when you say it to me. And so part of that collaborative process requires that you worked together on business value, engineering facilitates that it's not just about producing a business case. It's really more about the process and steps that you go through to get to that business case that allows you to establish trust and understanding and clarity. >>How does this enter into the customer discussion? >>And so it enters as early as you can possibly make it. Answer rights? A. Right at the beginning, you asked the very first question, which is fundamentally, what are the business initiatives that you're trying to achieve with this potential change program? And then you have a deep discussion about what they mean. So you understand and they understand, and everybody really agrees firmly what we're trying to achieve before you get anywhere near solution. And it's really difficult as technical people. I've got a technical background to stop yourself from hearing a problem and going. I've got a solution for that on it puts that a more disciplined approach to make sure that you don't straight away go to solution to help. You really understand where you're going, how you're gonna get there and therefore what the financial benefits and metrics would be to do it. Who >>were >>the ideal stakeholders when you're doing a collaboration like this in terms of getting them involved in getting their >>implements. So you might expect the answer to be C level executives on Dove course. They're important from, ah, leadership in a direction perspective. But as it turns out from a human psychological behavior perspective, there are three personality types that are really, really suitable for this kind of engagement work that's focused around change. And if you find those three personality types and quite well understood types of people, they're the ones that tend to cause change. To happen more successfully doesn't mean there any more valuable than anybody else inside an organization, but the other right kinds of people to establish this sort of work with, and it's important you have the right number of those people in a change program. >>So change agents. So I would think like a PL manager here. She's controlling a big portion of the budget. Has thousands of people working for them would be important. Maybe not a sea level executive, but a line of business executive, the son of the field General. Could that be an example of a change agent? Not necessarily because they're trying to protect their turf, >>so not necessarily right When it comes to change, change is always hard in any company you've ever been in in all of our careers. Change is difficult, right? >>Wake up in the morning. >>Let's change. It s it's more about who were the people that lay the groundwork for that change that you follow. You listen to the influences. Now, of course, you'll have people that own the budget the financial controllers on Absolutely. They're important. Of course they are. But they may not be the personality type that causes change to happen. Business value engineering is about making sure you harness the right talent, the right skills, the right people at the right time. Thio help organizations realize the benefit off change. >>If you'll excuse me, this is not seem like a typical role for a software company to take on. Yeah, change management. What? How do you Why do you put yourself in that role? >>I think this is something that all software companies are gonna have to do. And you will see the subject of business value engineering in many software vendors. Now it's true. It's a fine line between being a business analyst and being a software vendor. they were a software provider. I think software providers that don't deliver the context on the value that they are trying to achieve with software they buy in the customers are poorer supplies because they're just trying to push technology on its fun. Technologists like myself enjoy the technology, and I'd buy technology all day long. But is it really the right thing to do? So I think it's about being morally right. You have to take the high ground and conduct that engagement in a way which in some cases, and this has certainly been true in my career, you do the business value work and you realize that you probably shouldn't do the project on. You have to have that that fortitude to say to the customer. This is actually not a great idea because the financial case doesn't support this. I think it is. Taking that moral high ground is a really important stance and software companies that do that generally those customers will come back to you in a future dark time when they've got a different problem. That perhaps does fit you. So I think it's about recognizing there's a both a short medium and a long term engagement with with with the customers that you have to maintain that >>in 2019. Given all the discussion on data digital transformation A. I cloud, I would think that data plays a crucial role in these discussions. So what role does data played? Companies understand the importance of data as it relates to the business value discussion. >>Absolutely. I think I think that data driven decision making is is pretty fundamental. A lot of people say the numbers don't lie. Maybe some statistics might be bent, but numbers don't really like, so you've got to be a capture numbers and make decisions based on those numbers. Eso One of the difficulties, though, is that for many, many years in many industries, we've been using very simple terminology and simple mathematical calculations to do these value calculations. Everybody's aware of Years ago, the software industry was awash with phrases like return on investment calculators, >>R o i N P V I R R. Even >>some of those numbers of valid right for >>a business case for sure, >>for sure, but just sticking with simple things like are always is not enough >>salad. If you treat the software as an asset. A zey expense? Essentially, >>Yeah, yeah, absolutely. But then it comes to the engagement's more than your software I like. I like Thio, I think, as a human being, the software is considerably less than half the game in any change program where you're trying to achieve value and the people they're human beings they're going to do with work are the ones that are going to generate the value. The software's a tool, and the years are very important tool. But it's a tool. So you have to think about how do you build teams that can collaborate around value, achieve the value, measure the value, capture that data but at the same time physically collaborate properly to do the work? >>So how have you apply this methodology for your customers? >>So we've done a number of things, so we've established practice inside. If s, we've made sure that every country has the capability to do business value engineering. We've hired some specialists, people who do this for a living. Andi, we are working with lots and lots of customers now on this as a Maur methodical disciplines approach. But we've also recognized that we needed to measure our existing customers benefits. So what you are existing customer base achieved with our software. So we commissioned Ah, pretty big and important study. And that was anonymous. We weren't involved other than inviting the company to go and do this work on, then unleashing them on our customer base for six months across all industries, all products on asking them to go and find out and measure what our customers really achieve with the software. >>So how was that anonymous? How it was in that you weren't doing the survey. >>We weren't doing the survey and any, um, numbers that came back. Where were anonymous? Dhe. So we couldn't say. Oh, it was this company that gave this feedback with these numbers. So it gave them a sense of freedom to be other express and share that data. >>And so you were specifically asking about the business impact of of I f s software throughout some kind of life cycle, like a before and an after? Yes, Exactly. Isn't it to be or what happened? Okay, so what'd you find >>so as a couple of surprises in the results, actually eso firstly >>tell us who did the study or is that >>yes, So the study. That's a good question, because the the choices are many. There are lots of analyst firms out there that you could use A ll do this sort of work and do it very well. The team that I worked with, we would personally had a previous relationship with I. D. C. Now we really liked I. D. C. And I've done some of this work previously with I D. C. Because they arm or they're an analyst. That has more statisticians as well as analysts. So they take a really very methodical mathematical approach. A scientist. I very much appreciated that. So we we picked them to do this work, and they take it really very, very seriously. And there were a lot of strict processes they have for how we are allowed to engage with them and talk to them during this process. On that rigor, I think, allows us to be comfortable with the numbers and for our customers to be comfortable with the numbers that they obtain because of this anonymity and the rigor they put behind. That's why we picked I. D. C. That work in terms of what we found out where they found on we now just see the report on our customers can go and see this report. We published it last week. So you're just gonna free download and look at the material from I. D. C. The first thing that was interesting about the study. It was human productivity focused. So not things like, how much inventory you hold in supply chain on. Was it reduced? It was more about how did the workers get on? What kind of mistakes did I made? L. A. Faster doing their work and more successful. And they looked at lots of different categories on the returns. The improvements ranged from just a 10% improvement. So not not a huge improvement all the way up to a 94% improvement in productivity. Human productivity. If you averaged it all out, it worked out just shy of of 19% 18 and a bit percent productivity improvement across all of the different teams from the finance function, the supply chain function, human resource functions, sales team, productivity function. So we saw a range. What was good was it pretty much didn't matter. Which category of customer or size of customer or industry. They all saw pretty similar productivity improvements, which means we can extrapolate the numbers. The second thing we saw, which was a surprise, a very pleasant surprise was that usually when you see these kinds of benefits studies, most of the value is in cost. Saving on only cost saving tends to be where asset management resource planning service management happens. Just under half of the value that the I. D. C study showed was net new revenue. The customers were finding that nearly half of the benefit was new money coming to the company. Top Line benefit. That's a little unusual. >>So let me pick. Probe Adept so productivity When I when you're saying productivity, I think revenue per employee has a simple list measure of productivity. But then you're saying there was incremental revenue, a swell independent. It first of all is is revenue per employee the right measure? Or was it more like Do we think's faster or sort of more generic measurements and specific to a task? Or was it kind of boil down to a revenue per employee? And and then how did that relate to the the incremental revenue. >>Yeah, so it was done by function by by team type. So if you look to finance and auditing and human resources and supply chain and so on so that the metrics on the you'll see in the white paper are specific to the team's specifically that role specific to that, >>right, You're not really big in insurance, but a claims adjuster could, you know, get more claims done exactly, or something like >>exactly example. So you'd find, for example, one of the statistics was around filled service engineering on how many jobs per day they couldn't do. It was reasonably specific, >>and they would attribute that directly to your software Direct. Now, as a result of installing I f s, how much would you increase your etcetera per day? >>That's why it took them six months to do the study. I mean, this is quite an in depth piece on >>how many customers that the interview. >>And so it was a cross on dhe. We gave them a challenge to do this. So it was a set of about 17 fairly large customers, which sounds like a small time. >>No, no, no, >>no. But when you do these kinds of studies, >>that's a totally legitimate number. And then thes air in depth surveys. Yeah, so it's not like it's not trivial. And and as well, revenue increases specific, too. The software. So that would have been what, like cohorts sales or service, you know, follow on sales things of that nature. >>Absolutely. And that's why we were so delighted with the report when it came back, because it was it was a really nice pleasant finding. So most companies that all the companies reported the revenue increase, but some are bigger than others. On average, it was a pretty sizable chunk, nearly half of all of the benefit. Um, and when we asked, I D C well, can you give us some kind of glimpse as to why we see such a large chunk of improved revenue? I. D. C. Said, Well, you're improving the productivity of the sales teams so they can quote faster. There's more accuracy and those quotes. The service quality is improved the speed and to get a product to market is faster, so their ability to respond to bids and tenders is better. So is actually a combination of lots of things speed error quality improvements that led to their ability to bid and win faster and better business net revenue. >>Did you attempt Thio factor in less tangible factors, such as customer satisfaction, that promoter score perceived value, customer perceived value. >>So the folk note that the focus of the study was human productivity on. And it's something that I d. C do particularly well on that that's what we gave them a target. Obviously, when we doing business value engineering, you then have to take way more than just that. Things like the benchmark dated find from a study like I. D. C. Have conducted where you take into account those soft factors on other factors outside of human productivity. So value engineering is way more than just human productivity, which is why it's an engagement model. It's something you have to do mutually together. That kind of transparency, really, is what most customers are now demanding. You know, I'm not buying technology unless I know what business outcome I'm going to obtain from this. It's just the way of the world these days. >>It could take away that so it's not just your software's not just operational impact in nature. It's more strategic. It has productivity impact, revenue impacts and obviously cost savings as well. Congratulations. That's good. How did we get this study >>out of people? You said customers can download it. Can anybody down? >>Anybody can download this U S So we've published it on our website. It's very easy to find on it. Sze freely available. We obviously have to comply with the I. D. C's. They owned the rights for the report because it was their material, but we've oversee purchased the rights to the other, distribute that material. We think it's super valuable for our customers. >>What a business model >>and super well, you know, And and if I was to write business case for it, I'd be delighted with the work that was done and I'd be happy with the outcome on. I'm sure our customers will make use of the information to be a benchmark, their own work and also hold my effects on our partners to account to help build business cases. >>Well, I you know, I know it's anonymous ized anonymous to protect the customer, but I bet you some of the customers would be willing to go public with some of this information. So hit him up. Bring him on the cube, you know, well distributed for free. If you want to charge for them. Reprint rights. Great to have you on. Thank >>you. Thank you. >>All right. Thank you for watching Paul Gill and I will be back with our next guest to wrap up I f s World 2019. You're watching the Cube from Boston?

>>Live from Boston, Massachusetts. It's the cube covering ifs world conference 2019 brought to you by ifs. >>Well going back to Boston and everybody, this is the cube, the leader in live tech coverage. We're here day one at the ifs world conference at the Hynes convention center in Boston. Cindy shutdown is here. She's the president of America's at ifs and she's joined by to my right, K in Blackwell, who's a controller at PPC partners, one of the divisions of PPC Metro power. And rod is the CIO of PPC partners. Welcome folks. Good to see you. I said, let me start with you. So you were on last year in the cube down at Atlanta. You still kind of set some, set some goals, you're a little competitive with your other brethren within then ifs. We love it. You know, we're Americans. Okay. So how's it going in North America? >>Um, well it's, it's growing well. We've had fantastic growth and it's been, you know, a little bit of competition within ifs, but you know, certainly we were very proud. We were named region of the year last year. So we won the coveted cup, which, uh, means, uh, we, uh, we want to keep that cup. So that's some of the, some of the competition that we've got going, right? >>Yeah. Well, of course, most of us based companies, they'll do, they'll start up 79, you know, 90% of their businesses, U S if not 100%, and then they'll slowly go overseas as some of the opposite. Right? >>Very much. I mean, ifs is a European based company. We've been in the, in the U S for quite awhile and, but we've really been investing in our growth and we've had fantastic growth over the last few years. And I think, you know, one of the reasons for that growth is our customer satisfaction in the fact that we really want to listen to our customers. You know, I, um, I, I travel quite a lot as you can imagine. And when I travel, I always try to make sure I can visit customers and hear what they have to say, you know, and of course we love to hear the good things, but I also like to hear when they can give us some ideas for improvement and um, you know, then that gives us something to work on and to, you know, to keep moving forward. Um, I also think that, you know, the good thing about that is, um, it gives us a chance to listen and um, you know, I heard something really great from one of our customers, they went live two weeks ago and they called up and said, Hey, can we do a customer story? I love things like that. Yeah. >>I always love that. Uh, let me think about it. I'll get back to you. Okay. What's your relationship between ifs and PPC part? >>Well, PPC partners is one of our newer customers in there in the middle of an implementation and they're doing some great things around digital transformation. And when I had this opportunity to be here on the cube, I thought it would be great to invite rod and can with me and to, you know, tell some of the things that they're doing. >>Cool. So I kind of recruited Cindy as my cohost, your, they're going to be the defective coho. So welcome to the queue and then we're going to show you right to the fire. Okay. So, uh, can you describe your, your role, your when one of the divisions of PPC partners, right? So maybe maybe set up sort of PPC partners and then your role. >>Right. Okay. So PPC is a specialty contracting company and we have four subsidiary companies that operate in the upper Midwest and then also the Southeastern United States. And we provide, um, um, customers within a base innovative, innovative solutions in the electrical and mechanical contracting. So there are those four companies. I was one of the controllers, um, of those four companies for a lot of years. And now I'm on the core team. There's four of us, five of us now, um, that are involved in the implement. >>Okay. So you got all the numbers in your head. And then rod, you're the CIO and you guys are a service organization for all the divisions. Is that correct? That is correct. >>We sit at the holding company and we're responsible for technology across all four of those specialty contractor companies that can just mention. >>So I love these segments, Cindy, because you know, we, here you go, we go to a lot of conferences in the cube and um, you hear a lot about digital transformation, but, so I'd like to ask the practitioners, what does that mean for you guys? We've got somebody who's very close to the line of business, like I say, knows the numbers, but at the end of the day you've got to deliver the technology services. So what does digital transformation mean to you? What's the company doing in that regard? So a great question actually. >>Um, you'll find companies like ours that have been on the same platform for quite a while, uh, 50 plus years, uh, five zero five, six, zero, uh, probably North of five zero, but we'll go with five zero. Uh, and what happens over time is just, you know, with the system can't grow with the organizations, you resort to a lot of manual paper pushing a lot of file flinging, lots of Excel. And so there's just a ton of duplication of effort and those types of things going on. So from a technology standpoint, that's really the stuff that I come in and see and go, you know. Um, but overall I think that getting to the ifs platform, getting a lot of those redundant processes, a lot of the file flinging out of there, it's just going to be beneficial for all of them. >>Okay. So you guys have had to make the business, you're in the middle of the implementation, right? Is that correct? So she had to go through the business case. Um, it sounds like the business case was, you know, we're, we're basically struggling with running our business because, you know, data's all over the place. We don't have a single view of our business, our customers, et cetera. So we have to come to grips with that. But, but, so what was the business case like? I presume that you were involved as well. >>Right. So I've was really involved in building the software that we've used for that 40 plus years though I haven't used it all of them two years. Um, and, and it was really. It was built by accountants. We, you know, intended for it to meet the needs of the whole, the whole organization. But really it was built by accountants. So, um, we've found that we just really weren't able to keep up with meeting the needs of all of the users. Um, so when we started looking at that, we also had, we were running on a couple of different, um, I'm going to call them boxes. We run it on IBM. So, um, we were not able to look across the entire organization and see a consolidated view of the whole organization. So that was one of the things that we were looking to do, was to really bring all four companies under one umbrella and be able to get a picture of the whole mainframe or, yes, we had a couple of mainframes and all of that software was internally written. Um, and it was good. It was, it was good, but it met, you know, just the needs that those of us within the company saw. Um, so I think we were missing a whole lot of opportunity, um, to really, you know, see what else was out there and see new things and really get outside of our sphere of understanding, you know, >>so PPC, >>no, I was going to say as SKM pointed out and the sort of running joke within the companies is the system we have today does numbers really well. Words not so much because it was designed by accountants for accounting, tracking the financials primarily. Yeah. >>In PPC you do construction of course, or construction club, but you also do some service as well, right? You've got people out in the field that are, that are doing, doing service. So when you were looking, um, I'm assuming that you were trying to find a system that could do both, both solutions. Yeah. Did. >>Absolutely. Uh, one of the things that's been concerning to the entire core team is it's great to go out and find a system and there's plenty of them that can handle your back office. Most systems do that fairly well. But what about you feel services, uh, any in our particular industry, electrical contracting, you might have residential, you know, we could very well be working on the buck stadium or a military installation or even the school, you know, those folks have to be able to process invoices, do all sorts of things from a handheld, et cetera, et cetera. That was a big, big driving factor for us. So has a lot of COBOL code running? Is that, is there right here? So you said 50 years, I mean, um, so now I'm interested in the, in the, in the migration and, and you know what that looks like. >>Yeah, I'll bet. So do you, do you have to freeze the existing sort of systems and then sort of bring the other ones up to speed? Is this cloud-based? What does that all look like? That great question. So, uh, we are, uh, we subscribe to the managed cloud solution. Um, you know, for most construction companies, electrical contracting companies like ours, you know, technology is important, but it is not what really makes our wheels turn. It's a con. It's a competitive advantage if you use it wisely. And so, um, you know, for us it was very important to think about this holistically and try to figure out if we're gonna bring in a solution, what does that solution need to look like and will it work for all of our companies, not just one, not just residential, commercial, et cetera. Okay. All right. So, so w w what's that journey look like? I mean, um, when did, when did it start? What's your >>sort of timeline? So about two and a half years ago, we really started looking at what we had in on hand now and what we had in place and thinking about did we really want to make a move? And so, um, we had a team that came together about 15 people across the organization from operations and also the back office to really evaluate what we had evaluated our needs. Um, we decided, yes, we needed something new. And then we actually brought in a second team, um, that started looking at what that new thing would be. We had a consultant assisting us with that and uh, we kinda narrowed it down to two players if you will. And ifs was one of those. Um, and we, even though, um, one of the things that we liked was the fact that that ifs had, um, a broad reach over different types of industries and we felt like that would give us, um, something in addition to a construct and centric view know domain expertise. Yeah, >>exactly. You know, and you know, with our core industries, you know, construction is a big part of that. But one of the things that we're seeing in the construction industry today is the trend to go to what we call prefabrication. The fact that you know, you can really speed up a project if you aren't trying to build everything on site and you can also do it much more cheaper. McKinsey has a study out and they believe that over time if, if of comp of construction company will engage with prefabrication, they can reduce the project timelines 20 to 50% and lower the cost up to 20% and with ifs is heritage in manufacturing. It's really a perfect marriage for construction companies because construction companies need the project management, the installation, you know, the change management that goes along with some of those back-office things. They also a lot of time have to do service. But if you really want to get that competitive advantage, if you can take advantage of the prefab, which is really manufacturing high, if this is heritage, he could really have a, a full, complete S, you know, solution from one supplier. >>There's a huge trend in home-building actually. You would, you see, you know, modular homes and kind of the future of it. But uh, so how does that affect you guys? I mean you, you prefab something that resonates with you, is that sort of more of a generic statement across the customer base or >>it's certainly an area where we're focusing on more. Um, we also have an automation, uh, division that really focuses on, um, automation for industries. And that's an area that it's kind of a manufacturing type of thing. They build panels and those sorts of things. So we're definitely seeing it >>well. So, okay. So I got to ask you, so when you pulled out the Gartner magic quadrant, I said, okay, it always is. Ifs isn't the leader that, that, that, that might've helped. Right. Okay. So you don't get fired now, but choose the leader, but then you started peeling the onion. He had to do due diligence. So what kinds of things did you look at? What kind of tires did you kick? Piers, did you talk to and be, I'm interested in what your, what you learned. Well, I'll touch on one key element and >>we can get in as many sub elements as you like. The selection process for us took several months. Um, I think initially we really pared it down to about eight packages that we were seriously considering. Then down to four and then eventually down to two. And what really, really intrigued us about ifs was the fact that they are not construction centric. So we really had a big decision to make internally, which was do we want to just get on the bandwagon and do what everyone else in construction is doing or do we really wanna you know, risk versus reward and go after something special. So ifs, they are in, you name it, manufacturing is obviously key. Aerospace engineering, race cars I saw today, I didn't know that. So that was a big selling point for us. And the plan is to retire your mainframe and go into the cloud. >>Yes, yes, yes. So IBM got you in a headlock. >>We've been friends for a long time. Good company. Um, w what's that been like just to sort of, uh, that the thought of, you know, going to the cloud. W how, how is, you know, the it folks you know, responded to that. Um, how has that changed their sort of role brokers versus all? Again, I think in construction organizations, technology is important, but it is not what makes the wheels turn. So I'm trying to bring in all of that iron and infrastructure and build it out and configure it ourselves and then maintain it for the long haul. Just not something that was value added for us. In addition, um, if you've ever worked with Oracle, which is a close partner of ifs, but there is a lot of licensing caveats and a lot of things you've got to worry about if you're going to go it alone by going with the managed cloud solution, we're sort of partnering and trusting ifs to take that on for us so we can focus on taking care of our companies, our customers, and doing what we do best. Right? So, okay, so you're still going to be an Oracle. You just won't be, it won't be as visible. We use Oracle too. We're a Salesforce customer, so Hey, Oracle is behind there, but no offense. >>Ah, I know you guys did >>for the distinction as well, right? Because even if you are going to have portions of Oracle that are running your system, you've got to have some Oracle experts on staff. You know, if you're going to have all of the infrastructure, you gotta have infrastructure folks who understand how it all ties together. So on the surface it could seem like a simple decision to do it in house or go to the cloud. Far from it. >>Yeah. You know, I think certainly one of the things that we see in a lot of different industries, but certainly in construction, the plant had always been that you bring together different, different solutions and you try to both and together and then some of that becomes a lot more concerning. You know, some of the technology behind it. But one of the things that with the ifs solution is the fact that from one provider you can do, you know, do the whole life cycle. So then some of the have it in the managed cloud where we take care of it for you. So then that takes away some of those technology issues and then you can focus on your core competencies. So Rhonda would agree generally >>with what you're saying. I mean some probably say that for most companies that you know, the technology is not the core differentiator. Obviously this for Google, sure. For Amazon, for Facebook, but for CIO is I talked to, they go people process, technology, technology is the least of my problems. It's like I was going to come and go, it's going to change. I can deal with that. It's the, if the people in the process issues. So having said that, I'm still interested in how concerned you were about peeling the onion on the cloud, what's behind it, the security model, all that stuff in terms of your due diligence, you know, with any cloud based solution, there's some concern obviously. But, but in working with ifs, we, we asked a ton of questions and they gave us a ton of answers. So the comfort level was there. Um, the industry's been going to the cloud now for quite some time. And to be brutally honest, if you're not going there, um, you need to be strongly considered >>in Microsoft is our partner with the cloud. We're on, you know, using Microsoft Azure. So it's not like, you know, it's one of the largest cloud provider. So it's not like, you know, it's, it's something that you have to worry about. You've got the, you know, the backstop of Microsoft behind you as well. You know, I'm sorry, go, go, go. I was going to say, I think one of the things that's interesting is you talk about all your different divisions and you're really trying to bring a lot of different companies together on one system. And one of the things that I, you know, as I've seen the things that's change management becomes really something that you really have to consider. I mean, how have you seen that part of the implementation going? Has there been stepping in the easy piece for you? It's not been an easy piece and that's one of the pieces that we're still working on. >>Um, I don't know if any organization that says that they're really, really good at change. Um, but we've recognized that really the, our organization is a group of entrepreneurs and we've encouraged people to have their own business, but we're really trying to streamline and get some consistency across the organization. That's a little bit of a culture shift for us. So that change management piece is a piece that we're really trying to get our arms around now and prepare, um, the organization for that team. Just trying to get my head around your software still. You guys do change management? I TSM. Well, you'll change management is really some of the, um, consulting that goes along with it and certainly ifs and AR, we've got many partners who can, you know, help our customers go through that. Because when you're going through a digital transformation, you know, you're taking people who have been using something for 50 years, being out, especially out in the field doing those things. And now you're trying to figure out what are the right processes to put in place to get what the business needs. And in some cases they might have to do things differently. So you really have to think that through and how you're going to roll those out. >>So now, is this your first ifs world? Yes, it is. It is. What final thoughts, you know, things you've, you've taken away or you're going to bring back to your teams? >>Well, yeah, Boston is a favorite city of mine. I was just glad to be here just for that. But, and we've just been here a little bit. I've already picked up some things on leadership. I was involved the um, >>Oh, the women's leadership breakfast this morning. So there's already been some things that I think we can take back to users and share with them, particularly around change management and trying to get people comfortable and understanding why they're uncomfortable with change. You know? So it, rod, you're next on the line. So I'm sure you were taking notes, pretty attentive in the sessions and just getting started, right? >>No, you know, I have, and one of the things for me that was most, I guess rewarding is, is the partner network. All of the vendors. There's a number of things with our implementation that we're still trying to sort out OCR for example, being one of them. Are we going to go there or are we gonna wait until later? Just different technologies and maybe add ons that we may want to take advantage of. All you've got to do is walk down the hallways and there's, there's people ready to talk to you about it. So that's, that's been kind of intriguing. >>Okay. Excellent. Well yeah, I said earlier I was, I was surprised and impressed at the sort of size of the ecosystem and its great. Well good luck to you guys. Really wish you the best and thanks so much for coming on the cube and sharing your story Cindy. Great to see you. Always pleasure. All right, take care. Thank you for watching everybody. We're back with our next guest right after this short break. You're watching the cube from Boston ifs world 2019 right back.

>> Announcer: Live from Boston, Massachusetts, it's theCube. Covering IFS World Conference 2019. Brought to you by IFS. >> Welcome back to Boston everybody you're watching theCube, the leader in live tech coverage. This is day one of the IFS World Conference. I'm Dave Vallante with my co-host Paul Gillen. Melissa Di Donato is here, she's the CEO of SUSE and Jon Roskill is the CEO of Acumatica. Folks, welcome to theCube. >> Thank you so much. >> So you guys had the power panel today? Talking about digital transformation. I got a question for all of you. What's the difference between a business and a digital business? Melissa, I'll give you first crack. >> Before a regular old business and a digital business? Everyone's digital these days, aren't they? I was interviewing the, one of the leaders in Expedia and I said, "Are you a travel company "or are you a digital company? "Like where do you lead with?" And she said to me, "No no, we're a travel company "but we use digital." So it seems like the more and more we think about what the future means how we service our customers, customers being at the core everyone's a digital business. The way you service, the way you communicate the way you support. So whether you're a business or none you're always got to be a digital business. >> You better be a digital business and so-- >> I'm going to take a slightly different tact on that which is, we talk about digital and analog businesses and analog businesses are ones that are data silos they have a lot of systems, so they think they're digital but they're disconnected. And, you know, part of a transformation is connecting all the systems together and getting them to work like one. >> But I think the confict other common thread is data, right? A digital business maybe puts data at the core and that's how they get competitive advantage but, I want to ask you guys about your respective businesses. So SUSE, obviously you compete with the big whale RedHat, you know, the big news last year IBM $34 billion. How did that or will that in your view affect your business? >> It's already affecting our business. We've seen a big big uptake in interest in SUSE and what we're doing. You know, they say that a big part of the install based customers that RedHat and IBM currently have are unhappy about the decision to be acquired by IBM. Whether they're in conflict because we're a very big heavily channel business, right? So a lot of the channel partners are not quite happy about having one of their closest competitors now be, you know, part of the inner circle if you will. And other customers are just not happy. I mean, RedHat had fast innovation, fast pace and thought leadership and now all of a sudden they're going to be buried inside of a large conglomerate and they're not happy about that. So when we look at what's been happening for us particularly since March, we became an independent company now one of the world's largest independent open source company in the world. Since IBM has been taking over from RedHat. And, you know, big big uptake. Since March we became independent we've been getting a lot of questioning. "Where are we, where are we going, what are we doing?" And, " Hey, you know, I haven't heard about SUSE a while "what are you doing now?" So it's been really good news for us really, really good news. >> I mean, we're huge fans of RedHat. We do a lot of their events and-- >> Melissa: I'm a huge fan myself. >> But I tell you, I mean, we know from first hand IBM has this nasty habit of buying companies tripling the price. Now they say they're going to leave RedHat alone, we'll see. >> Yeah, like they said they'd leave Lotus alone and all the others. >> SPSS, you saw that, Ustream, you know one of our platforms. >> What's your view, how do you think it's going to go? >> I don't think it's about cloud I think it's about services and I think that's the piece that we don't really have great visibility on. Can IBM kind of jam OpenShift into its customers you know, businesses without them even really knowing it and that's the near-term cash flow play that they're trying to, you know, effect. >> Yeah, but it's not working for them, isn't though? Because when you look at the install base 90% of their business it's been Linux open source environment and OpenShift is a tag-along. I don't know if that's a real enabler for the future rather than, you know, an afterthought from the past. >> Well, for $34 billion it better be. >> I want to ask you about the cost of shifting because historically, you know if you were IBM, you were stuck with IBM forever. What is involved in customers moving from RedHat to SUSE presumably you're doing some of those migrations style. >> We are, we are doing them more and more in fact, we're even offering migration services ourself in some applications. It depends on the application layer. >> How simple is that? >> It depends on the application. So, we've got some telco companies is very very complex 24/7, you know, high pays, big fat enterprise applications around billing, for example. They're harder to move. >> A lot of custom code. >> A lot of custom code, really deep, really rich they need, you know, constant operation because it's billing, right? Big, fat transactions, those are a little bit more complex than say, the other applications are. Nonetheless, there is a migration path and in fact, we're one of the only open source companies in the world that provides support for not just SUSE, but actually for RedHat. So, if you're a RedHat, for or a well customer that want to get off an unsupported version of RedHat you can come over to SUSE. We'll not just support your RedHat system but actually come up with a migration plan to get you into a supported version of SUSE. >> If it's a package set of apps and you have to freeze the code it's actually not that bad-- >> It's not that bad, no. >> To migrate. All right, Jon I got to ask you, so help us understand Acumatica and IFS and the relationship you're like sister companies, you both the ERP providers. How do you work together or? >> Yeah, so we're both owned by a private equity firm called EQT. IFS is generally focused on $500 million and above company so more enterprise and we're focused on core mid-market. So say, $20 million to $500 million. And so very complementary in that way. IFS is largely direct selling we're a 100% through channels. IFS is stronger in Europe, we're stronger in North America and so they see these as very complementary assets and rather than to, perhaps what's going on with the IBM, RedHat discussion here. Slam these big things together and screw them up they're trying to actually keep us independent. So they put us in a holding company but we're trying to leverage much of each other's goodness as we can. >> Is there a migration path? I mean, for customers who reach the top end of your market can they smoothly get to IFS? >> Yeah, it's not going to be like a smooth you know, turn a switch and go. But it absolutely is a migration option for customers and we do have a set of customers that are outgrowing us you know, we have a number of customers now over a billion dollars running on Acumatica and you know, for a company, we've got one that we're actually talking to about this right now operating in 41 countries global, they need 24/7 support we're not the right company to be running their ERP system. >> On your panel today guys you were talking about, a lot about digital transformations kind of lessons learned. What are the big mistakes you see companies making and kind of what's your roadmap for success? >> I think doing too much too fast. Everyone talks about the digital innovation digital transformation. It's really a business transformation with digital being the underpinning the push forward that carries the business forward, right? And I think that we make too many mistakes with regards to doing too much, too fast, too soon, that's one. Doing and adopting technology for technology's sake. "Oh, it's ML, it's AI." And everyone loves these big buzz words, right? All the code words for what technology is? So they tend to bring it on but they don't really know the outcome. Really really important at SUSE were absolutely obsessed with our customers and during a digital transformation if you remain absolutely sick of anything about your customer at the core of every decision you make and everything you do. Particularly with regards to digital transformation you want to make sure that business outcome is focused on them. Having a clear roadmap with milestones along the journey is really important and ensuring it's really collaborative. We talked this morning about digital natives you know, we're all young, aren't we? Me in particular, but, you know I think the younger generation of digital natives think a little bit differently perhaps than we were originally thinking when we were their age. You know, I depend on that thinking I depend on that integration of that thought leadership infused into companies to help really reach customers in different ways. Our customers are buying differently our customers have different expectations they have different deliverables they require and they expect to be supported in different way. And those digital natives, that young talent can really aid in that delivery of good thought leadership for our businesses. >> So Jon, we're seeing IT spending at the macro slow down a little bit. You know, a lot of different factors going on it's not a disaster, it's not falling off the cliff but definitely pre-2018 levels and one of the theories is that you had this kind of spray-and-pray kind of like Melissa was say, deal was going too fast trying everything and now we're seeing more of a narrow focus on things that are going to give a return. Do you see that happening out there? >> Yeah, definitely some, I mean people are looking for returns even in what's been a really vibrant economy but, you know, I agree with Melissa's point there's a lot of ready, shoot, aim projects out there and, you know, the biggest thing I see is the ones that aren't, the fail that aren't the ones that aren't led by the leadership. They're sort of given off to some side team often the IT team and said, "Go lead digital transformation of the company." And digital transformation you know, Melissa said this morning it's business transformation. You've got to bring the business part of it to the table and you've got to think about, it's got to be led by the CEO or the entire senior leadership team has to be on board and if not, it's not going to be successful. >> So, pragmatism would say, okay, you get some quick hits get some wins and then you got kind of the, you know, Bezos, Michael Dell mindset go big or go home, so what's your philosophy? Moonshots or, you know, quick hits? >> I always think starting you know, you've got to understand your team's capabilities. So starting is something that you can get a gauge of that you know, particularly if you're new and you're walking into an organization, you know. Melissa, I don't know how long you've been in your role now? >> Melissa: 65 days. >> Right, so there you go. So it's probably a good person to ask what, you know, what you're finding out there but I think, you know, getting a gauge of what your resources are. I mean, one of the things you see around here is there are, you know, dozens of partner firms that are, or can be brought into, you know supplement the resources you have in your own team. So being thoughtful in that is part of the approach. And then having a roadmap for what you're trying to do. Like we talked this morning about a customer that Linda had been talking about. Have been working on for six or seven years, right? And you're saying, for an enterprise a very large enterprise company taking six or seven years to turn the battleship maybe isn't that long. >> Okay, so you got the sister company going on. Do you have a commercial relationship with IFS or you just here as kind of an outside speaker and a thought leader? >> I'm here as an outside speaker thought leader. There is talk that perhaps we can you know, work together in the future we're trying to work that out right now. >> I want to ask you about open source business models. We still see companies sort of struggling to come up with, not profitable but, you know, insanely profitable business models based on open source software. What do you see coming out of all this? Is there a model that you think is going to work in the long term? >> I think the future is open source for sure and this is coming from a person who spent 25 years in proprietary software having worked for the larger piece here in vendors. 100% of my life has been dedicated to proprietary software. So whilst that's true I came at SUSE and the open source environment in a very different way as a customer running my proprietary applications on open source Linux based systems. So I come with a little bit different of a, you know, of an approach I would say. The future's open source for sure the way that we collaborate, the innovation the borderless means of which we deliver you know, leadership within our business is much much different than proprietary software. You would think as well that, you know the wall that we hide behind an open source being able to access software anywhere in a community and be able to provide thought leadership masks and hides who the developers and engineers are and instead exacerbates the thought leadership that comes out of them. So it provides for a naturally inclusive and diverse environment which leads to really good business results. We all know the importance of diversity and inclusion. I think there is definitely a place for open source in the world it's a matter providing it in such a way that creates business value that does enable and foster that growth of the community because nothing is better than having two or three or four or five million developers hacking away at my software to deliver better business value to my customers. The commercial side is going to be around the support, right? The enterprise customers would want to know that when bump goes in the night I've got someone I can pay to support my systems. And that's really what SUSE is about protecting our install base. Ensuring that we get them live, all the time every day and keep them running frictionlessly across their IT department. >> Now there's another model, the so-called open core model that holds that, the future is actually proprietary on top of an open base. So are you saying that you don't think that's a good model? >> I don't know, jury's out. Next time that you come to our event which is going to be in March, in Dublin. We're doing our SUSECON conference. Leave that question for me and I'll have an answer for you. I'm pontificating. >> Well I did and-- >> It's a date. The 12th of March. >> It's certainly working for Amazon. I mean, you know, Amazon's criticized for bogarting open source but Redshift is built on open source I think Aurora is built on open source. They're obviously making a lot of money. Your open core model failed for cloud era. Hortonworks was pure, Hortonworks had a model like, you know, you guys and RedHat and that didn't work and now that was kind of profitless prosperity of Hadoop and maybe that was sort of an over head-- >> I think our model, the future's open-source no question. It's just what level of open source within the sack do we keep proprietary or not, it's the case maybe, right? Do we allow open source in the bottom or the top or do we put some proprietary components on top to preserve and protect like an umbrella the core of which is open source. I don't know, we're thinking about that right now. We're trynna think what our future looks like. What the model should look like in the future for the industry. How can we service our customers best. At the end of the day, it's satisfying customer needs and solving business problems. If that's going to be, pure open source or open source with a little bit of proprietary to service the customer best that's what we're all going to be after, aren't we? >> So, there's no question that the innovation model is open source. I mean, I don't think that's a debate, the hard part is. Okay, how do you make money? A bit of open source for you guys. I mean, are you using open source technologies presumable you are, everybody is but-- >> So we're very open API's, who joined three years ago. We joined openapi.org. And so we've been one of the the leading ERP companies in the industry on publishing open API's and then we do a lot of customization work with our community and all of that's going on in GitHub. And so it's all open source, it's all out there for people who want it. Not everybody wants to be messing around in the core of a transaction engine and that's where you get into you know, the sort of the core argument of, you know which pieces should be people modifying? Do you want people in the kernel? Maybe, maybe not. And, you know, this is not my area of expertise so I'll defer to Melissa. Having people would be able to extend things in an open source model. Having people be able to find a library of customizations and components that can extend Acumatica, that's obviously a good thing. >> I mean, I think you hit on it with developers. I mean, that to me is the key lever. I mean, if I were a VM where I'd hire you know, 1000, 2000 open source software developers and say, "Go build next-generation apps and tools "and give it away." And then I'd say, "Okay, Michael Dell make you a hardware "run better in our software." That's a business model, you can make a lot of money-- >> 100% and we're, you know, we're going to be very acquisitive right now, we're looking for our future, right? We're looking to make a mark right now and where do we go next? How can we help predict the outcome next step in the marketplace when it pertains to, you know, the core of applications and the delivery mechanism in which we want to offer. The ease of being able to get thousands of mainframe customers with complex enterprise applications. Let's say, for example to the cloud. And a part of that is going to be the developer network. I mean, that's a really really big important segment for us and we're looking at companies. Who can we acquire? What's the business outcome? And what the developer networks look like. >> So Cloud and Edge, here got to be two huge opportunities for you, right? Again, it's all about developers. I think that's the right strategy at the Edge. You see a lot of Edge activity where somebody trying to throw a box at the Edge with the top down, in a traditional IT model. It's really the devs up, where I think-- >> It is, it is the dev ups, you're exactly right. Exactly right. >> Yeah, I mean, Edge is fascinating. That's going to be amazing what happens in the next 10 years and we don't even know, but we ship a construction edition we've got a customer that we're working with that's instrumenting all of their construction machinery on something like a thousand construction sites and feeding the sensor data into a Acumatica and so it's a way to keep track of all the machines and what's going on with them. You know, obviously shipping logistics the opportunity to start putting things like, you know, RFID tags on everything an instrument to all of that, out at the Edge. And then the issue is you get this huge amount of data and how do you process that and get the intelligence out of it and make the right decisions. >> Well, how do you? When data is plentiful, insights, you know, aren't is-- >> Yeah, well I think that's where the machine learning breakthroughs are going to happen. I mean, we've built out a team in the last three years on machine learning, all the guys who've been talking about Amazon, Microsoft, Google are all putting out machine learning engines that companies can pick up and start building models around. So we're doing one's around, you know inventory, logistics, shipping. We just release one on expense reports. You know, that really is where the innovation is happening right now. >> Okay, so you're not an inventor of AI you're going to take those technologies apply 'em to your business. >> Yeah, we don't want to be the engine builder we want to be the guys that are building the models and putting the insight for the industry on top that's our job. >> All right Melissa, we'll give you the final word and IFS World 2019, I think, is this your first one? >> It's my first one, yeah-- >> We say bumper sticker say when your truck's are pulling away or-- (laughs) >> A bumper sticker would say, "When you think about the future of open source "think about SUSE." (laughing) >> Dave: I love it. >> I'd say in the event, I mean, I'm super-impressed I think it's the group that's here is great the customers are really enthused and you know, I have zero bias so I'm just giving you my perspective. >> Yeah, I mean the ecosystem is robust here, I have to say. I think they said 400 partners and I was pleasantly surprised when I was walking around last-- >> This is your second one, isn't it? >> It's theCubes second one, my first. >> Oh your first, all right, well done. And so what do you think? Coming back? >> I would love to come back. Especially overseas, I know you guys do a bunch of stuff over seas. >> There you go, he wants to travel. >> Dublin in March? >> March the 12th. >> Dublin is a good place for sure so you're doing at the big conference? >> Yep, the big conference center and it's-- >> That is a great venue. >> And not just because the green thing but it's actually because (laughs). >> No, that's a really nice venue, it's modern It's got, I think three or four floors. >> It does, yeah yeah, we're looking forward to it. >> And then evening events at the, you know, the Guinness Storehouse. >> There you go. >> Exactly right. So we'll look forward to hosting you there. >> All right, great, see you there. >> We'll come with our tough questions for you. (laughing) >> Thanks you guys, I really appreciate your time. >> Thanks very much. >> Thank you for watching but right back, right after this short break you're watching theCube from IFS World in Boston be right back. (upbeat music)

>>live from Boston, Massachusetts. It's the Q covering I. F s World Conference 2019. Brought to you by I. F. S. >>Welcome back to Boston, everybody. You're watching The Cube. The leader in live tech coverage is Day one coverage of the I. F s World Conference. Darren Russo's here is the CEO of F S Darren. Thanks for coming back in the Cube. Great TV again. So last year was your first year. He was kind of laid out your vision at the World Conference. How's progress? >>Yeah, Look, it's going incredibly well. We were really focused on how we go from being a pretty fragment of global business to being, you know, an integrated business where we were able to operate. You know, its scale globally in a very homogenous way, where the customer experience was the same, irrespective where they engaged with us. And, you know, we've made a tremendous amount of progress with it, So you know, the business is growing really strongly. Net revenues up 22% year on year. I lost its revenues up 40% year on year are clouds up in the triple digits, so you know it's tough to be critical of how it's going so far. >>That's great, Great. You're growing faster than your peers. I think the stat was you gave us three Ex factory except in the industry would be awesome. Is that means that your primary benchmark do you want? You want to gain share? You want to go faster than the big whales, I presume. I >>think two things One is customer satisfaction, we believe, is the key indicator of long term success. S O. You know, we're the number one ranked European efforts. Salmon gotten appearance sites. That's that is and always will be my number. One metric. Can we be way the number one from a customer satisfaction perspective? And then I believe the revenue stats will follow and you know that's where we are. So certainly, if you look at our our core peers, the big G R P vendors, all of them are flat on. Dhe were growing 20 ships since >>one of the things you mentioned in your Cube interview last year was one of the things that you wanted to focus on was I'll call regional alignment. Paul and I used to work for I D. G. I worked for I. D. C. You were editor in chief of Computer World. We work for a company, had more offices overseas and IBM, and it was really hard to herd the cats. And that was one of the things that you cited. Have you been able to get people generally poor or at the same time? And how has that affected your business? Yeah. Look, I >>think the big challenge before I arrived was that there wasn't really a strategy of global strategy for the business. My face had a way of working and there was a strong culture, but there wasn't really a strategy. And obviously it's difficult to be critical of people when they not following the strategy when there isn't one s o. You know, Step one was really making sure that we had a strategy on DDE that was really about being focused on the five industries that we focused on, focused on three solutions on dhe focused on the six segments of customer, which is half a 1,000,000,000 to 5 billion. So now, globally, you know, irrespective the office that you go to, um anywhere in the world, they're focused on those five industries they focused on those three solutions and they're focused on their customer segments. So it helps me. P. M >>I said during our preview video video this morning that I've been around this industry as long as I f s has, until last year had never even heard of it. Is that just me being clueless? There's something there >>that we were just saying before we started that we're the definitely the biggest software business you've never heard of. Um, and and and that's common, I think, you know, we were There are a couple of factors. One is that the business was very European centric. Andi didn't really engaged in a tremendous amount of marketing and media prison. So, you know, those are elements that, you know, I think we're doing a better job off now, But we have a long way to go. The challenge that we have is that where we compete, we win when we get in and were able to tell our story, and we're able to show the value we win. We just don't get into as many deals as we need to. And that's the challenge we have. >>Yeah, there was a lot of talk this morning about the importance of those five pillars of those five industries. If you're going to become the next S A P, you're gonna have to branch out beyond that. What is your thinking about diversify >>becoming the next? They say he is definitely not my ambition, You know, I think way remain focused on customer satisfaction. And, you know, I think that there's a there's a difference. Whatever it is leading them, it's not customer satisfaction. You worked >>there for four years. >>I worked there for four years. I know. I think the big thing for me is is that we've got to stay focused on their customer voice. They focused on what delivers value for our customers beyond just the rhetoric and hyperbole. You know, I think when you when you listen to a lot of the complexity that our customers are facing today, any customers are facing. Companies are facing increasingly disruptive times, and the tech industry is making life more difficult for them. The more best of breed solutions get both. The more fragments that potential the landscape is, the more complex it becomes for customers if they have to try and figure out. How do we integrate these things and derive value from this highly fragmented landscape? So you know, we're trying to solve that problem. How do we make it easier for customers to challenge in their industry? And that's where this whole for the challenges has check comes from. How do we help him to be disruptive in their industry? Have competitive advantage? >>That seems to be a sort of a fundamentally different thing about your approach, though. Is this focus on those vertical industry's most e r P companies did not do that. Is that something that is core to your values? >>Look, I >>think what we recognize is that as you move to the cloud, you have to drive to standard. That's just the reality of going to the cloud on what's happening for the horizontal E. R B vendors. So the locks of ASAP and Oracle is that they have one e r P solution that fits every industry. So if it's good for health insurance and it's good for a bank, then it's difficult to really get your head around the fact that it could be good for a defense manufacturer, but the functional requirements is simply vastly different on that means that you have to customize them. If you have to customize that, they can go to the cloud. So what we believe is that you have to have this vertical specialization, the five industries that we serve us all. A lot of commonality in the process is that they use. And that's why that vertical strategy is so key to our success. So you won't see us going into financial service is, or health care or retail worth that core application. We may in time in many years to come branch out. That will be a different solutions. >>So your tailor, that app for that module for that industry, Yes, just go deep, deep functionality. You're known for that, but at the same time you're also messaging. You want your customers to be able to tailor this for their environment. So square that circle for me. >>So I think when we talk about a choice and and I think tailoring is the wrong word, we talk about choice. We're talking about choice of deployments on Prem or in the cloud choice of customer choice of partner, rather who they're going to deploy with on Dhe, then The solution is really an industry solution that comes with that functional death. And we don't we don't advocate their customers customized that all. We really don't want them to customize it. What we explain to them in some detail is that the real value comes from adopting the solution for two standard and staying on a vanilla application. Because that vanilla application, you're going to be able to withstand future upgrades, the total cost of ownership gets lower. The processes that are embedded in that application or best of breed at the box. That's what they're intended to do, and that works when you have a vertical application. When you have a horizontal application and you're trying to have a do things that it shouldn't naturally be doing, that becomes company. >>Well, correct me if I'm wrong, but wasn't that essentially the message ASAP had when it went through? It's hyper growth in the late nineties. I mean, there was a Y two k thing there, too, but ah, lot of the message was around. Do it our way and and then you don't have to get stuck in a rut, >>So I think that when it came out with that generation of application. That certainly was what they had hoped would happen. But what happened in practice is that the system integrators came in and the whole business process reengineering explosion happened on Dhe. That's not how it how it manifested itself. So what you see is, you see, he's very large, monolithic ASAP applications that were customized over in some cases decades, not not. You know, if a customer is deploying for two standard, then they should be able to deploy in a period mission. In weeks, we spoke about our deployment with Racing Point. If one team and going live in 12 weeks, you know, we're a 700 million global business. We deployed a knife s in 24 weeks. You know, if a customer's deploying for two standard, it's measured in weeks. As soon as they start to talk about two years or three years or five years or seven years there, customizing the solution significantly. Yeah, I >>mean, it became just sort of a perpetual upgrade, maintenance and up for the time it had a business impact. But boy, you think a cloud today agility, you know, getting rid of waterfall approaches, Missus. Antithetical to today's Look >>what I don't point fingers here. I think that this just maturity come with experience. The line of business applications you'll see our EMS and your HR solutions have taught people that you can, if you think about this is look at sea. Are Emma's an example? You had Siebel before people would implement stable. They would customize Siebel that would take long implementations. They were highly bespoke applications and then sells. Force came along and just destroyed them, and they destroyed them. Because what people learned very quickly was that there was a really easy to consume, really easy to use application that functionally might be inferior. But the compromises that you'd make from a functionality perspective will weigh, outweighed by their time to value in ease of use. And and the learnings from CR mnh are in procurement. Those line of business applications have now being backed into in the e. R. P >>world. So in terms of capital allocation, you're owned by private equity, which is actually a public company. I'm interested in how you're allocating capital R and D, where you're where your emphasis is. You don't have to you have to do stock buy back, but, you know, describe the P relationship. >>So look, one of my learning's to see survive this is that not all private equity firms or equal they have different strategies are very fortunate to be with Ekiti, who are a growth investor. They're known as a growth investor on dhe, and they buy companies that are strong growth tech firms on dhe. They've been hugely supportive of us investing because they understand that the investment in technology is important. So, you know, just looking at some detail today we invest twice as much in R and D as we did three years ago, just to give you, you know, one data point. So there's a big focus on technology, and the thing is, is that we we have to invest in technology to drive those attributes that are discussed earlier. How do we How do we enable customers to adopt a solution? It's a standard so they can go alive quicker. How do we enable customers to be able to sit down in the front of the application like we do with the mobile phone and intuitively know how to use it? How do we reduce the total cost of ownership through automation. Those are capabilities that you know that they don't come for free. We have to invest in them. So big investments in technology. And >>I think the private equity guys, at least the modern ones, have realized Why should the V. C's have all the fun they realize? Hey, we can actually put some money in tow and the transforming we can have a bigger exit and actually make much better returns than sucking the company drive. Yeah, well, look, I think the other >>thing is is that you know, in public companies, you have the downside off. You know this this courtly metric Ondas quarterly cadence. Andi, you see very compromising decisions being made because you know, people can't afford to miss 1/4. There's no long term planning that's done on dhe. That's fundamentally not the case and the private equity world, you know, not unusual now for four p firms to hold companies for 5678 years on, and that allows you to take a very long term strategic view. If if if a shift from perpetual to subscription is the right thing to happen, they can do that without worrying that, you know, because of the definite earnings are revenue that you're going to get caned by the market next quarter. Andi. I think that that needs to, I think, better decision making for the long term. >>A lot of companies are struggling. >>If you have the right P for because you get bought by the firm of events, you want to go public. But the the you said something this morning that 50% of your customers each year or net knew, How are you pulling that off >>That 50% of our license revenue? Eso way we went about 300 odd new customers a year. Obviously, that's growing, as I said, you know, 40%. But you know, it's ah, I think, having done this for 25 years, there are companies that are or good at extracting revenue from their installed based. One of the analysts here has as a hashtag wallet Fracking is what do you think It's such a great So you know, they're good at Wallick fracking and and I think the customers that that our customers off those vendors know exactly who they are and you know I think that for us to that the fact that we're able to go out and win 50% of our license revenue from net new name customers, I think is a really strong indicator of the health of the business. It's much harder to do than just extracting revenue out of the install base. You know, we don't have a compliance practice. We've never charged a customer for you in direct access. You know, these are principles that we stand by, and it's easier to say that your customer centric on get 80% of your revenue, have your installed base because you're doing compliance rounds. But, you know, we put our money where our mouth is, and that's not that's not how we do it. >>Are these net new customers? Are they? Are they migrating from QuickBooks or they migrating from a Competitors >>know, because of the segment that we're in this half a 1,000,000,000 to 5 billion? I would say the majority of them are what I would call first generation the Rp solution. So you know you're talking about you know, the original generation of Microsoft's acquisitions, the divisions and the eggs actors and the Solomon's and so on on. And then, you know, it's a P R two and our three customers you're talking about customer sitting on, you know, the solutions that in for hoovered up the matrix B picks type customers, ace 400 customers. So they're you know, they're first generation your P solutions that simply don't have the flexibility to deal with the complexity and demands of modern business world. >>From 2009 about 2017 I f. S was pretty inquisitive and then just actually, I was gonna ask you >>when I started, you stopped >>it, right? But then, you know, today you announced an extra small acquisition, But how should we think about M and a >>look? The first year for me was really about trying to build a functional business. You know, we spoke about how fragmented this really hit to Jenna's business. Andi just occurred to me. You know, if we go out and we start to buy things, how do we integrate them into a business that's completely fragments? And you know, it had no identity or culture. So, you know, the last year has been focused on how do we build their common understanding of what it is that we're doing. We now have a very clear strategy. Five industries, three solutions, one segment. And you know, when you when you have that clarity of vision that it's really easy to guard and do him and I because you know what fits and what doesn't fit, you can understand exactly how you're gonna build value for customers on dhe. That's why the S t a deal is so good for us. Because we're now the undisputed leader in field service management, you know, 8000 our customers globally, which is way more than anybody else. Scott, Andi, you know, you should absolutely expect more from us. But it will be in the five industries, three technology segments and one customers. Isaac. >>Well, in the A p I enablement should obviously facility. >>Absolutely. I mean, I was just with a partner of ours now, and they have this amazing augmented reality solution. You know, it will be a combination of off going out there to build market, share a cz well, as finding you know, really innovative solutions that can help us advance the technology that we provide customers. >>You have a new slogan this year for the challengers, which seems to be aimed at companies that that imagine themselves as challenging the Giants, which is great. But if you're not a company that season sees themselves that way. Are the studies level home with I have s Look, >>I I think I was with a group of CEOs from one of the big analyst rooms, and they had the portfolio companies and their private equity firm and analysts that CEOs of the companies are having a conversation with him about digital transformation. And I I made a rather provocative statement which, you know, got unanimous agreement, which is that all of the CEOs there with either in an industry that was being disrupted and we're trying to figure out how they respond to that disruption or they would soon not every job and they all acknowledge that they absolutely fit into that category. In other words, all of them were being disrupted. All of them were facing a challenge. It was kind of like, you know, if it is happening to all of us at a more rapid pace than we have ever had before. So my view is, is that you know if if you're in the room and you're going, you know, if it's might not be for us because we're not a challenger. Yeah, The lights may not be on >>for Long s o double click on that. What role does I s play in terms of digital transformation? >>If I could just hold on there because the thing is, there are leaders in Mama, there challenges. And there are leaders. The leaders typically are gonna go with seif solution. They're gonna go with one of the legacy our peace. So I'm not suggesting that everybody necessarily is a challenger. There are leaders, you know, Nokia was a leader until they weren't because they were complacent. Andi, I think they you know, they didn't run on I office. So, you know, I think there are two segments. There are leaders and there are challenges, and we're there for the ones that are ready to disrupt. Sorry. >>Please clarify that. No. Good. So So get back to it. Sort of digital transformation and disruption. What do you see? Is the role of AARP generally, but specifically I f s. >>Look, I think we digital information. A lot of discussion about it on the stage this morning. I've just touched on it now. I think that it takes very different forms. What most industries are finding is that they're facing a lot of non traditional competition and they're having to innovate around their business models. They can't going to market in the same way as they did before. They're having to innovate because of this non traditional competition. Andi. Understanding your your customer's understanding, your your staff, understanding your supply chain understanding your financials are all critical parts of being able to respond to whatever their changes, and that's where the RP solution comes into it. I think there's an interesting challenge now, which is that as those applications have become more fragmented and you've got more based debris cloud applications Ah, lot of the value often E. R P was that you had this integrated set of applications that you had this one source of the truth andan. Fortunately for many customers today, they don't have that because they've got import all of these best of breed applications and they don't have one source of the truth that multiple invoices made it multiple versions of their customer in the databases. Andi we still stand for a single integrated the r p. So, you know, I think understanding those elements of your businesses key. I was with a customer of ours in Nebraska a short while ago, and they were talking about our existing office customer. They were talking about the steel import duties that were imposed through the trade war with China. And they were saying, Look, that they had been able to respond to that in a way that they had good visibility of the supply chain, who was improved, imposing the tariffs, how they were going to impact them when they were going to impact them. And because they had this integrated Siara AARP. They were able to pass those pricing changes onto their customers, and they survived this. What could have been a cataclysmic event for their business had they not had an integrated your pee? They not being able to have this visibility into the supply chain and the customer base. They may well have gone out of business just because of that one change >>to meet all day and all comes back to the data, putting their putting data at the core of their business. That integrated data pipeline is essentially what they get out of that last question. So thinking about the next 18 to 24 months, what are the milestones that observers should look for? One of the barometers that we should be watching. >>So look, in the next two years, it's it's really about us building incremental scale. We have, ah, four year plan, which I built when I came in. We're halfway through that plan. We've hit all of the metrics and exceeded most the metrics that we had on their plan. It's really continue to focus on the strategy. As I said, we focus on those five industries, continue to build market share, continue to focus on those three solution types and build market share and market dominance on those three solutions. Andi in that segment that I defined before, so no change from a strategy perspective. I think there's really value in the consistency that we bring on on their talk track and, you know, along the way we passed the $1,000,000,000 mark, which we will do, I think, in 2021 organically if we accelerate, some of the money will pass the 1,000,000,000 before, but you know business. The margins continue to expand. We focus on customer satisfaction and, you know, it's a It's a pretty straight, you know, traditional prey book that we have to execute on now. >>Well, congratulations. It's a great playbook, and you're growing very nicely. So love that. Look, we really an honor to the last couple of years. Learn a little bit about the company in your industry. So appreciate meeting you guys. Thank you. All right. And thank you for watching over right back with our next guest. Ready for this short break day Volonte with Paul Gill in. You're watching the Cube from I f s World Conference from Boston 2019 right back.

>>Bly from Boston, Massachusetts. It's the cube covering ifs world conference 2019 brought to you by ifs. >>Okay. We're back in Boston, Massachusetts ifs world day one. You walked into cube Dave Vellante with Paul Gillen boss Devoss is here. He's the director of ISF I F S labs and Bob Dico who's the vice president of AI and RPA at ifs jets. Welcome. Good to see you again. Good morning bossy. We're on last year. I'm talking about innovation ifs labs. First of all, tell us about ifs labs and what you've been up to in the last 12 months. Well, I have has Lapsis a functioning as the new technology incubator. Fire Fest writes over continuously looking at opportunities to bring innovation into, into product and help our customers take advantage of all the new things out there to yeah. To, to create better businesses. And one of the things I talked about last year is how we want to be close to our customers. And I think, uh, that's what we have been doing over the pasta pasta year. Really be close to our customers. So Bob, you got, you got the cool title, AI, RPA, all the hot cool topics. So help us understand what role you guys play as ifs. As a software developer, are you building AI? Are you building RPA? Are you integrating it? Yes, yes. Get your paint. >>I mean, our value to our customers comes from wrapping up the technology, the AI, the RPA, the IOT into product in a way that it's going to help their business. So it's going to be easy to use. They're not going to need to be a technical specialist to take advantage of it. It's going to be embedded in the product in a way they can take advantage of very easily that that's the key for us as a software developer. We don't want to offer them a platform that they can just go and do their own thing. We want to sort of control it, make it easier for them. >>So I presume it's not a coincidence that you guys are on together. So this stuff starts in the labs and then your job is to commercialize it. Right? So, so take machine intelligence for example. I mean it can be so many things to so many different people. Take us back to sort of, you know, the starting point, you know, within reason of your work on machine intelligence, what you were thinking at the time, maybe some of the experiments that you did and how it ends up in the product. Oh, very good question. Right? So I think we start at a, Oh, well first of all, I think ifs has been using a machine learning at, at various points in our products for many, many years of Trumbull in our dynamic scheduling engine. We have been using neural networks to optimize fuel serve scheduling for quite some many years. >>But I think, um, if we go back like two years, what we sold is that, uh, there, there's a real potential, um, in our products that if you will take machine learning algorithms inside of the product to actually, um, help ultimately certain decisions in there, um, that could potentially help our business quite a bit. And the role of ifs lapse back in the day as that we just started experimenting, right? So we went out to different customers. Uh, we started engaging with them to see, okay, what kind of data do we have, what kind of use cases are there? And basically based on that, we sort of developed a vision around AI and a division back in the day was based on on three important aspects, human machine interaction optimization and automation. And that kind of really lended well with our customer use case. We talked quite a bit about that or the previous world conference. >>So at that point we basically decided, okay, you know what, we need to make serious work of this, uh, experimenting as boots. But at a certain point you have to conclude that the experiments were successful, which we did. And at that point we decided to look at, okay, how can we make this into a product and how to normally go system. We started engaging with them more intensively and starting to hand over in this guys, we decided the most also a good moment to bring somebody on board that actually has even more experience and knowledge in AI and what we already had as hive as labs. But that could basically take over the Baton. And say, okay, now I am going to run with it and actually start commercializing and productizing that still in collaboration with IVIS laps. But yeah, taking that next step in the road and then then Bob came onboard. >>Christian Pedersen made the point during the keynote this morning that you have to avoid the, the appeal of technology for technology's sake. You have to have it. I start with the business use case. You are both very technology, very deep into the technology. How do you keep disciplined to avoid letting the technology lead your, your activities? >>Well, both. Yeah. So, so I think a good example is what we see this world's going fronts as well. It is staying closer to customer and, and, and accepting and realizing that there is no, um, there's no use in just creating technology for sake of technology as you say yourself. So what we did here for example, is that we showcase collaboration projects with, with customers. So, for example, we show showcase a woman chair pack, which um, as a, as a manufacturing of spouting pouches down here in Massachusetts actually, uh, and they wanted to invest in robotics to get our widows. So what we basically did is actually wind into their factory literally on the factory floor and start innovating there. So instead of just thinking about, okay, how do robotics and AI for subrogations or one of our older products work together, we set, let's experiment on the shop floor off a customer instead of inside of the ivory towers. Sometimes our competitors to them, they'll start to answer your question. >>Sure. I can pick up a little, a little feasible. Yeah. Well, so in, I think the really important thing, and again, Christian touched on it this morning is not the individual technologies themselves. It's how they work together. Um, we see a lot of the underlying technologies becoming more commoditized. That's not where companies are really starting to differentiate algorithms after a while become algorithms. There's a good way of doing things. They might evolve slightly over time, but effectively you can open source a lot of these things. You can take advantage, the value comes from that next layer up. How you take those technologies together, how you can create end to end processes. So if we take something like predictive, we would have an asset. We would have sensors on that asset that would be providing real time data, uh, to an IOT system. We can combine that with historical maintenance data stored within a classic ERP system. >>We can pull that together, use machine learning on it to make a prediction for when that machine is gonna break down. And based on that prediction, we can raise a work order and if we do that over enough assets, we can then optimize our technicians. So instead of having to wait for it to break down, we can know in advance, we can plan for people to be in the right the right place. It's that end to end process where the value is. We have to bring that together in a way that we can offer it to our customers. There's certainly, you know, a lot of talk in the press about machines replacing humans. Machine of all machines have always replaced humans. But for the first time in history, it's with cognitive functions. Now it's, people get freaked out. A little bit about that. I'm hearing a theme of, of augmentation, you know, at this event. >>But I wonder if you could share your thoughts with regard to things like AI automation, robotic process automation. How are customers, you know, adopting them? Is there sort of concern up front? I mean we've talked to a number of RPA customers that, you know, initially maybe are hesitant but then say, wow, I'm automating all those tasks that I hate and sort of lean in. But at the same time, you know, it's clear that this could have an effect on people's jobs and lives. What are your thoughts? Sure. Do you want to kick off on them? Yeah, I'll know. Yeah, absolutely. That's fine. So I think in terms of the, the automation, the low level tasks, as you say, that can free up people to focus on higher value activities. Something like RPA, those bots, they can work 24, seven, they can do it error free. >>Um, it's often doing work that people don't enjoy anyway. So that tends to actually raise morale, raise productivity, and allow you to do tasks faster. And the augmentation, I think is where it gets very interesting because you need to, you often don't want to automate all your decisions. You want people to have the final say, but you want to provide them more information, better, more pertinent ways of making that decision. And so it's very important. If you can do that, then you've got to build the trust with them. If you're going to give them an AI decision that's just out of a black box and just say, there's a 70% chance of this happening. And what I founded in my career is that people don't tend to believe that or they start questioning it and that's where you have difficulty. So this is where explainable AI comes in. >>I do to be able to state clearly why that prediction is being made, what are the key drivers going into it? Or if that's not possible, at least giving them the confidence to see, well, you're not sure about this prediction. You can play around with it. You can see I'm right, but I'm going to make you more comfortable and then hopefully you're going to understand and, and sort of move with it. And then it starts sort of finding its way more naturally into the workplace. So that's, I think the key to building up successful open sexually. What it is is it's sort of giving a human the, the, the parameters the and saying, okay, now you can make the call as to whether or not you want to place that bet or make a different decision or hold off and get more data. Is that right? >>Uh, yeah. I think a lot of it is about setting the threshold and the parameters with within which you want to operate. Often if a model is very confident, either you know, a yes or a no, you probably be quite happy to let it automate. Take that three, it's the borderline decision where it gets interesting. You probably would still want someone to look over it, but you want them to do it consistently. You want them to do it using all the information to hand and say that's what you do. You're presented to them. And to add to that, um, I think we also should not forget they said a lot of our customers, a lot of companies are, are actually struggling finding quality stuff, right? I mean aging of the workforce riots, we're, we're old. I'm retiring eventually. Right? So aging of the workforce is a potential issue. >>Funding, lack of quality. Stop. So if I go back to the chair pack example I was just talking about, um, and, and, and some of the benefits they get out of that robotics projects, um, um, is of course they're saving money right there. They're saving about one point $5 million a year on money on that project, but their most important benefits for them, it's actually the fact that I have been able to move the people from the work floor doing that into higher scope positions, effectively countering the labor shortage today. They were limited in their operations, but in fact, I had two few quality stuff. And by putting the robots in, they were able to reposition those people and that's for them the most important benefits. So I think there's always a little bit of a balance. Um, but I also think we eventually need robots. >>We need ultimation to also keep up with the work that needs to be done. Maybe you can speak to Bobby, you can speak to software robots. We've, Pete with people think of robots, they tend to think of machines, but in fact software robots are, where are the a, the real growth is right now, the greatest growth is right now. How pervasive will software robots be in the workplace do you think in the three to five years? >> I think the software robots as they are now within the RPA space, um, they fulfill a sort of part of the Avril automation picture, but they're never going to be the whole thing. I see them very much as bringing different systems together, moving data between systems, allowing them to interact more effectively. But, um, within systems themselves, uh, you know, the bots can only really scratched the surface. >>They're interacting with software in the same way a human would on the whole by clicking buttons going through, et cetera, beneath the surface. Uh, you know, for example, within the ifs products we have got data understanding how people interact with our products. We can use machine learning on that data to learn, to make recommendations to do things that our software but wouldn't be able to see. So I think it's a combination. There's software bots, they're kind of on the outside looking in, but they're very good at bringing things together. And then insight you've got that sort of deeper automation to take real advantage of the individual pieces of software. >> This may be a little out there, but you guys >>are, you guys are deep into, into the next generation lot to talk right now about quantum and how we could see workable quantum computers within the next two to two to three years. How, what do you think the, the outlook is there? How is that going to shake things up? So >>let me answer this. We were actually a having an active project and I for slabs currently could looking at quantum computing, right? Um, there's a lot of promise in it. Uh, there's also a lot of unfilled, unfulfilled problems in that, right? But if you look at the, the potential, I think where it really starts playing, um, into, uh, into benefits is if the larger the, the, the optimization problems, the larger the algorithms are that we have to run, the more benefits it actually starts bringing us. So if you're asking me for an for an outlook, I say there is potential definitely, especially in optimization problems. Right. Um, but I also think that the realistic outlook is quite far out. Uh, yes, we're all experimenting it and I think it's our responsibility as ifs or ciphers laps to also look on what it could potentially mean for applications as we FSI Fs. >>But my personal opinion is the odd Lucas. Yeah. So what comes five to 10 years out? What comes first? Quantum computing or fully autonomous driverless vehicles? Oh, that's a tricky question. I mean, I would say in terms of the practical commercial application, it's going to be the latter in that much so that's quite a ways off. Yeah, I think so. Of course. Question back on on RPA, what are you guys exactly doing on RPA? Are you developing your own robotic process automation software or are you integrating, doing both say within the products? We, you know, if we think of RPA as, as this means of interacting with the graphical user interface in a way that a human would within the product. Um, we, we're thinking more in terms of automating processes using the machine learning as I mentioned, to learn from experience, et cetera. Uh, in a way that will take advantage of things like our API eighth, an API APIs that are discussed on main stage today. >>RPA is very much our way of interacting with other systems, allowing other systems when trapped with ifs, allowing us to, to send messages out. So we need to make it as easy as possible for those bots to call us. Uh, you know, that can be by making our screens nice and accessible and easy to use. But I think the way that RPA is going, a lot of the major vendors are becoming orchestrators really. They're creating these, these studios where you can drag and drop different components into to do ACR, provide cognitive services and you know, elements that you could drag and drop in would be to say, ah, take data from a file and load it into ifs and put it in a purchase order. And you can just drag that in and then it doesn't really matter how it connects to YFS. It can do that via the API. And I think it probably will say it's creating the ability to talk to ifs. That's the most important thing for us. So you're making your products a RPA ready, friendly >>you, it sounds like you're using it for your own purposes, but you're not an RPA vendor per se. You know what I'm saying? Okay. Here's how you do an automation. You're gonna integrate that with other RPA leadership product. I think we would really take a more firm partner approach to it. Right? So if a customer, I mean, there's different ways of integrating systems to get our RPA as a Google on there. There's other ways as well, right? That if a customer actually, um, wants to integrate the systems together using RPA, very good choice, we make sure that our products are as ready as much for that as possible. Of course we will look at the partner ecosystem to make sure that we have sufficient and the right partners in there that a customer has as a choice in what we recommends. But basically we say where we want to be agnostic to what kind of RPA feminists sits in there that was standing there was obviously a lot of geopolitical stuff going on with tariffs and the like. >>So not withstanding that, do you feel as though things like automation, RPA, AI will swing the pendulum back to onshore manufacturing, whether it's Europe or, or U S or is the costs still so dramatically advantageous to, you know, manufacture in China? Well, that pendulum swing in your opinion as a result of automation? Um, I have a good, good question. Um, I'm not sure it's will completely swing, but it will definitely be influenced. Right. One of the examples I've seen in the RPA space ride wire a company before we would actually have an outsourcing project in India where people would just type over D uh, DDD, the purchase orders right now. Now in RPA bolts scans. I didn't, so they don't need the Indian North shore anymore. But it's always a balance between, you know, what's the benefit of what's the cost of developing technology and that's, and it's, and, and it's almost like a macro economical sort of discussion. >>One of the discussions I had with my colleagues in Sri Lanka, um, and, and maybe completely off topic example, we were talking about carwash, right? So us in the, in the Western world we have car wash where you drive your car through, right? They don't have them in Sri Lankan. All the car washes are by hands. But the difference is because labor is cheaper there that it's actually cheaper to have people washing your car while we'd also in the us for example, that's more expensive than actually having a machine doing it. Right. So it is a, it's a macro economical sort of question that is quite interesting to see how that develops over the next couple of years. All right, Jess. Well thanks very much for coming on the cube. Great discussion. Really appreciate it. Thank you very much. You're welcome. All right. I'll keep it right there, but he gave a latte. Paul Gillen moved back. Ifs world from Boston. You watch in the queue.

>>live from Boston, Massachusetts. It's the Q covering I. F s World Conference 2019. Brought to you by I. F s. >>Welcome back to I f s world Everybody, This is David Dante with Paul Dillon and you're watching the Cube, The leader in live tech coverage. Where here from? From the Heinz Auditorium. Nick Ward is here. He's the head of OM Digital Solutions for Rolls Royce and Scott Helmer, president of the F S aerospace and defense. Gentlemen, welcome to the Cube. Thanks for coming on. Thank you. Scott. I want to start with you. We heard a lot about digital transformation. You guys are in the heart of that. Ah, defense. Aerospace is one of those industries that hasn't been dramatically disrupted. Like publishing. Are you seeing taxis? It's a It's a high risk business. It's one that's highly in trench, but it's not safe from disruption. What are the major trends that you're seeing in your space and paint a picture for us? If you would, >>uh, that's a very good question. You're right. The same level of disruption related digital transformation has not yet common aerospace. Defense is that has come to some of the other league leading industries. But this is a whether it's land based operations, naval operations or aircraft operations. This is an asset intensive industry. It's characterized by a very connected network of organizations. Be the manufacturer's operators, subsystem, part suppliers or just maintainers. They stay connected throughout the asset life cycle in its entirety. I f F f s has a portfolio capability. There's four purpose underpinning the critical business processes of those organizations that enables us to be the digital thread to continue the connection of those organizations throughout that outs of life cycle, if you will, that sees this fall come to come to be at the heart of asset lifecycle Management on provides us with the opportunity to inform information insights for our customers. Like return on experience data on aircraft engines where an old GM like Rolls Royce, for example, can harvest that data to analyze the performance of those assets and ultimately optimized thereafter after service offerings. >>Who are the customers? I mean, there's a limited number of companies that make aircraft engines so you don't have a huge domain been numbers of those kinds of companies. But are the customers channel their partners the supply chain network >>Well, the ecosystem is actually large and extensive. They're very recognizable names, and it's certainly an industry that's characterized by significant growth. On the commercial side. Amaro continue is in the midst of a boom and is likely to continue to grow, are expected to continue to grow for at least another decorate decade. And on the defense side, we see military budgets continue or increasingly moving towards sustainment and serve it ization on a performance basis. So the number of organizations that are participating in that value chain whether they're just the upstream, only am so I should just upstream. But the Austrian Williams participate in the design and development are moving into the aftermarket sustainment and service support parts and subsystem supply, or ultimately, third part repair organizations. It's actually quite an extensive network participating in that asset life cycle. >>So, Nick, you know people here Rolls Royce, they think you know the iconic brand. We're gonna talk about cars, talk about your role at Rolls Royce and what's going on in your business. >>So my role I lead our product management function looking are digitally enabled. Service's so for 20 years we've been running a service we call total care. Total care is like a fixed dollar rate. Every time an aircraft flies, we paid a dollar rate for it. Flying. What's really great about that is we're incentivizing. No, I am exactly the same way that airline isn't said device. Keep the aircraft flying. It owns revenue for the airline. It owns revenue for us on that revolutionized relationship between oh am on operator. So within my role, it's about taking four division we call The Intelligent Engine. Intelligent Engine is recognizing the way that digital is starting to pervade the way we think about service is so we've talked about physical engine, big rotating piece of metal that people see service. Is that wrap around that on the digital brain that sits behind all of those sources? That's what we call the intelligent engine. >>Yes, so people sometimes think the mission critic critical piece of air travel is the reservation system. It's not. It's the thinness of the engines available that was lost in critical system, right? You mean like it? If you don't get your reservation Oh, well, somebody else will get it. Not not the end of the world But for the maintenance piece, that's all right. >>Job. You know, our fundamental mission is every rose was powered. Aircraft flies on time every time. All right, there's no disruption. There's no delay that works for the operator, for the airlines are owner of the aircraft. It works for us. And this is why the confluence of our incentives comes together and it really works well. >>So what role has technology played in terms of evolving that that experience? I mean, I'm sure, you know, years ago, it used to be a lot of tribal knowledge. Gut feel. Joe the mechanic really knew his stuff. Etcetera, etcetera, Powers. Technology evolved and changed your your business. >>So you had to go back to the business model, right? So technology should follow. The business model business model is fundamental risk transfer. So we take the risk off cost, fluctuation, availability, whatever it is away from the airline and we take it on to us is the Obama's Rolls Royce said the money's at risk. You gotta get really good forecasting. Four. Custom becomes your core skill almost because you've got to understand all the risk drivers understand how to optimize him, understand out of work around that in order to have a successful business. And you can't forecast without data without digital twins without all I ot and cloud and all the while the enablers allow you to sort of new to new generations of capability. >>So you're forecasting what probability of, ah, component failure, the life of ah, failure. How long it takes to bring stuff back on sure >>cost really on three different levels. So we do an engine forecast which is looking at the health of the life of the components in the engine, looking for any reasons why the engine might be forced off the wing. We're looking at a fleet level. So we're looking at all of the things that might affect the global fleet in terms of maintenance demands need for overhaul of those such things. And we forecast that out after 30 years, really accurately, as an engine leaves the factory, we know pretty much within 90 something percent everything that engine is going to require from the maintenance 20 to 30 years and then a network level. We're forecasting the capacity demand that we then need to meet within our maintenance shops globally. >>Well, He's obviously Paul. Been progress, right? We used to fly with very common four engine plains across the pond right now. Two engines. In fact, you don't want to fly in the four engine to engine more reliable. >>You've You've been a Rolls Royce for over 15 years. What have you seen as a result of all this technology is predicted maintenance technology. What impact is that? Had on equipment of reliability on life cycle on fuel efficiency. >>Huge, huge. I think if you don't have the data and you don't have the digital twin kind of capability behind you, you have to treat every engine like it's the worst engine in the fleet because you don't have the data tell you it isn't right. So everything is treated extremely extreme conservatism. If you have the data and you have the models and you have everything else around you, you treat engines, individuals. They have individual histories, individual configuration, individual experiences. Because of individuals. You tailor your maintenance intervention to keep that engine flying as long as you can on, you don't have to be his conservative. You can weed that conservatism out of the process, and that means it stays on wing 40 50% longer. It's flying for the airline that much longer. Revenues. Passengers are flying. There's less disruption. >>So what do you What do you do with my f s? What's the what's >>So Because we created this intelligent engine kind of next generation leap forward in that capability, we need data. So we have, ah, program we call the Blue Data Threat. The blue data traded in a global initiative that we're rolling through all of our 200 plus airline customers. How do we form a win win transaction with the airlines? Give us better data will make smarter decisions. You'll see less disruption, more availability. We'll share our data. Back with you is an operator. So this is a very simple, very nice cashless transactions. So with my intern X, because we share a number of customers, Scott has got a number of airline customers. Big airline customers were operating the maintenance system. What way do together? Is reform a plug in? It's like for us. We can go to an airline, and we can say you have total care inside to borrow an intel phrase. So he complied into the rosary service is seamlessly automated. The data can flow very little burden or effort on to the I t group of the outline. The data flows into our organization. We do what we do when we can push our date again back into the airline systems with updated form, their availability >>so key to that key to that value, Jane is obviously that common customer base. But critical to the work that Rolls Royce stuns does is the accuracy and reliability of the data They get to inform their own performance analysis and maintenance, availability information and the eye if it's made installed. Base leverage is a very rich data from the return on experience of the engine utilization that Nick and is able to use this part of the Blue data threat offering back to their customers. And together we're able to deliver unprecedented levels of value to airline customers and optimizing the availability of their assets. >>Nick, have you? Are you finding new ways to monetize this data beyond just improving the customer experience, a bond with your customers or their new revenue avenues >>for you? So I think within this is absolutely key that everybody within this transaction recognizes this is this is not a revenue opportunity for Rosa. This is a cashless transactions because there's a lot of sensitivity that data belongs to the airline, right? So you have to be very clear and open. That data is driving Rolls Royce to make internal improvements, so we will save a little bit on our bottom line of delivering the service's they've already bought in order to get better. Outcomes of those service is so It's a little early for the service. You were thinking about >>this a little bit like security. In that sense, you know of bad guys are trying to get there. So So the good guys to share data. It's a cashless transaction, and everybody we >>believe is a market collaboration on data is got to be the way Ford's >>Scott could. You double click on the Ecosystem and A and D, obviously different from the sort of core traditional you know, e r. P world. The importance of the ecosystem may be what it looks like, described the >>That's an insightful question, Dave, certainly the partner ecosystem in inner space and defense is somewhat differentiated. I don't want to go so far as to say that it's unique, but it's somewhat differentiated from Corey RPS. As you duly noted partner, our four persecuted for four purpose capability around the critical process is for manufacturers. Maintainers on, uh, parts and subsystem supply organizations is all the potential, and it's a promise. But that value can only be realized to the collaboration with partners who doom or an aerospace and defense and just support delivery and implementation capability. They provide value added service is around business process, reengineering, change, enablement as well as their partners and co innovation as well. Certainly the collaboration we have with Rolls Royce is certainly a new level of collaboration around innovation that hasn't been seen before. So those partners are critical to our ability to deliver that value to our customers. Secondarily, we have our partners are actually a route to market in the traditional sense of referral system like you would see in Corriere P. But more importantly, as an indirect route to market as channels to their end customers, almost I s v ng. Our capability to support the delivery of service is to their customers. >>So it's the it's the manufacturers of the Plains, For example, it's the airlines themselves. It's manufactured the engine defectors, >>the maintainers. So the M R organizations that do the work around repair, and it's the entire ecosystem of organizations to support the supply chain. Our partners are both in themselves as well as partners in delivering the capability to those organizing. >>And it's a data pipeline throughout that value chain a digital thread that you guys actually have visibility on, correct your value. Add to the and >>we have the opportunity to play a vital role between within that equal system in allowing and enabling the connective ity of that network between Williams and their customers between the operators and their maintainers. For example, we've got a collaboration with an airline right now where we're going to connect them directly with the third party organizations that they rely on for airframe repair. For example, >>I want to ask you about the aerospace business it used to be that used to be a very small market in terms of the number of customers. Now we've got Space X. We've got the private areas, three private aerospace companies. We've got different countries now. India, China getting involved. What impact is that having on your business. >>Certainly we're seeing the emergence of spatial program's playing a taking up a larger share of off of government or public sector budgets. And people are beginning to think about how to leverage or harvest the value from utilization of spatial assets and again are enabling capability. To be a collector of that data and supply it back as an information in sight to those were reliant on the data that is collected is a vital role that we play in that ecosystem. >>So when I was when you were describing the ecosystem value chain, it strikes me that there's there's clearly a whole lot of metrics going on. Are there new levers, new metrics, emerging new levers that you can pull to really drive a flywheel effect in the industry? One of the key key performance indicators that you're really trying to optimize visiting? This is >>Certainly this is certainly an industry that characterizes as an intensive, complex mobile and in this case complex in mobile or a pseudonym for very expensive assets. So everything around availability, reliability are all key drivers are performance indicators of our customers ability to realise the value from those assets and our role in that is to provide them with the information inside to be able to make optimal decisions to maximize that availability. >>Anything you dad, >>I think in this day and age things like technical dispatcher alive. Relative engines is so high, high 99 sort of percentage. You have to start focusing on things like the maintenance costs to achieve that. Driving your maintenance costs down, but still retaining your really high availability. That becomes a really interesting balance. You could have under percent of relevancy. What it's gonna cost a fortune. You don't want that. >>Well, gentlemen, thanks so much for coming on. The cute, really fascinating discussion. Thank you. Great to have you. All right, you're welcome. And keep it right there, buddy. Paul Gill on day Volante from I F s World in Boston. You're watching the Cube right back Right after this short break

>> Announcer: Live from Boston, Massachusetts. It's theCUBE, covering IFS World Conference 2019. Brought to you by IFS. >> We're back at IFS World 2019 from the Hynes Convention Center in Boston. I'm Dave Volonte, with my co-host, Paul Gillen. You're watching theCUBE, the leader in live tech coverage. We go out to the events, we extract the signal from the noise, get the best guest, Christian Peterson is here. He's the chief product officer at IFS. Christian, great to see you. >> All right, thank you very much. Happy to be here. >> Your first IFS World Conference, so ... >> It is mine ... >> Mine too, so ... >> Yeah, I'm happy to be here. It's just like getting an injection of customer input and feedback in a very short amount of time So, that's uh, that's awesome. I really love it. >> Yeah, these events are great to connect with customers its one to many conversations. But, give us a sense of your background and why you were attracted to IFS. Why did you join? >> Well from a background perspective, I've always been in the effects of business and technology and uh, you know my passion has always been what we can actually do with technology for businesses to innovate, to differentiate, to do new things to automate things. Really, really a strong believer in the promise of software. Because that's what software is all about. Um, so, um, I have a past with Starbucks, I've started ELP companies, I've been with Microsoft. Uh, for fifteen, sixteen years. Um, have been with SAP for a number of years. So I joined, I joined IFS last year, um, really because of the transformation and the uh, the journey I just was on and the passion that IFS has always had for the customers. And the outcomes we've created for customers. It's just a perfect environment to, to uh to realize the dream of providing value to customers, outcomes for customers, and leveraging technology in the process. >> Yeah, so see you're a challenger, hashtag for the challenger. A hashtag is started. >> Really, really I mean you were at the giant uh, SAP and going to a smaller, not much smaller, but a smaller company, What were they doing that you thought that excited you so much? >> Well the exciting thing again is the focus on the customer and the close proximity to customers in everything I.. >> Wouldn't SAP, sorry to interrupt, wouldn't SAP be the same thing though? >> Let me just, let me put it this way, I went to IFS because I (intelligible) really, really brilliantly. So, is that a, is that a nice way of saying it. (laughter) >> (laughing) Okay. >> So were here for your keynote today you sort of laid out a roadmap, a little vision uh, talked a little bit about digital transformation. But, I wanted to talk about, the, you made a big big emphasis on your API platform. Open API's, embracing that, uh its been somewhat a criticism of you guys in the past. And so, maybe it's a response to that or a response to customers, but why the platform, why, to explain it, its importance and how it fits into your roadmap going forward. >> Well the API enablement is important for many different perspectives. First of all, we use API's ourselves. To create user experiences and drive a lot of the innovation where they are merging technology and so forth. That's one aspect of it. So just for our own, our own level of innovation and the pace at which we can innovate with, going forward on the API platform, is, is, is is dramatic. The second area is really again back to the digital transformation that customers are really driving out there um, a lot of that involves, um, really most companies becoming software companies themselves. So now we have a lot of our customers that actually have developers, they're writing software they're driving new offerings to their customers. And to get value out of these offerings for their customers They really need to get access to a a lot of the capabilites that lives inside of the IFS models. They need to get access to data, to get access to processes because, on of the keys in digital transformation regardless in what shape or form it comes is, you need data, you need massive amounts of data. And you need data from within your firewall you need data from third party, and you need structure data all structure data. And participating in that world is absolutely essential that you have that open API philosophy where you expose yourself and your own data and API's. But, also so we can turn the other way and we can consume data and API's from others so we can create similar scenarios. So it's really about being apart of the ecosystem of, uh, of technologies and solutions that customers rely on. And that's why we joined also, the open API foundation. >> You also demonstrated this morning, uh Orena, your new customer experience platform. Talk about what that is and why it's important. >> Well, so it's, it's important of course again because we, um, um, we have this generational shift in people that are coming into the workforce that expect and want to work differently. And, um, if you think about how people actually work, to do and get things done today, or think about ourselves. Now, we're no spring chickens anymore, right, we've been around... >> Speak for yourself. >> We've seen DOS, we've seen DOS systems. >> Yeah my hand went up in the 3.1 question. >> When the three point, did you put the mouse on the screen as well? (laughing) I've literally seen that. So we've been through that, but the people we are getting into the workforce now they have a different mentality. They are not thinking about what they do. Like, we are thinking about, "how does the system work?" "Where do I click? Where do I go next?" The intuition that people now apply to the system when they start working with them, the systems just have to reflect that intuition. It has to be intuitive, it has to be immersive as well. And the immersive part is really based on what the users see, what they do. The contextual information, the contextual intelligence they get in the context of what they do should want them to do more. Because they can, so they get dragged in and the new type of users, they just have that natural intuition, because that's how you browse the web. You go to one place on the web, go to the next thing, You get inspired by this, you go there. And there's no reason why the systems that you get your work done, why they shouldn't be the exact same thing. Orena is a huge step in that direction, together with our mobile enablement on multiple form factors and devices. >> So you, you mentioned you know saw everybody's becoming a software company, every company is becoming, you've been in the software business for awhile you work for a software company now. You're talking about Orena, you're talking about API integration, I showed you our software. My point is, software is hard. (laughs) There's a talent war for employees, we talked about that off camera. Um, so, as you see these companies digitally transforming, becoming software companies, Mark Endrese's, "software is eating the world", Mark Beneoff, "Everybody is becoming a software company", How are they doing? And what role can you play, IFS, in terms of helping them become a software company. Because it's, it's so damn difficult. >> Yeah, I think that the role of being a software company I think the absolute differentiation they want to create through software and differentiate the offerings or other things that they really want to do, We can't really help them there, because they're differentiated. Like if you're differentiated, you can't find something standard and use for that. But we can enable it and um, as we're looking at it, a lot of the emerging technologies that we can enable them with to achieve it, that's a number of things we can do. And, we are introducing a notion of an application, of application services here, where we really, enable these emerging technologies in the context of what we do. So, while you hear about technologies or augmented realities, mixed realities, artificial intelligence and robotics and IOT and artificial intelligence, all the stuff that you have, we take that and put into context of the focus industries that we focus on and the solution categories that we focus on. So EAP, enterprise asset management, service management. And in that way our customers can focus on what they actually need to do with it, versus focus on the, on the technologies. >> And the API platform allows those customers to, whatever the build to integrate to their ERP system if in fact... >> That's correct, that's correct. And as I mentioned, we also use API's not only on the front end of what we provide and expose all we have, but we also consume on the back end. So the way we actually consume the application services and drag them in and embed them is through API, these application services. >> I understand you're working on an entirely new architecture that you will be debuting in the spring of 2020. How is that going to change the game? >> We don't really think about it as a new architecture. We think about it as a natural evolution that includes some of these things. Uh, so for instance, the introducing, uh the introduction of the application services layer that I mentioned, is more a new layer in our architecture that we introduced. So we don't think about it as a new architecture, we're just evolving what we have. And because of that evolution, that is something that our entire product portfolio will benefit from. Um, and, I already mentioned today how we are aligning the product portfolio from an experience perspective. We are bringing the arena experience through our FSM product to our um, PSO product, to our customer engagement product and so forth. So we are aligning that front end experience on the same design patterns, so forth, because you know, a good experience is a good user experience. >> You talk about Orena bot and this, this gentleman here, who's given us this talk, just through out a gardner status. That, that by, I don't know, by whatever year 2023, uh, more money will be spent on bots than mobile integration. Which is, you know, quite a prediction. Your thoughts. >> Well, I, you know, there's, there's always all kinds of interesting predictions. I think actually, um, I actually think, um, there, amount of money may go down but I think the number of bots will go up dramatically. And, I think we will actually get to a situation where, bots will be creating bots. (laughs) Right? So, That's when you get, when we talk about intelligent and autonomous systems, I really believe it. Because there is no reason why we should not begin to see autonomy in software. >> Dave: Right. >> Um, we see it, uh, I use the example this morning, that we put our lives in the hands of technology everyday, when you go in your car and you use adaptor to cruise to control, you're trusting technology. Like, when you are driving your Tesla. I mean there was an example in San Francisco, uh, I think, uh, in December last year, where the police had been following a driver for 17 miles. And the car wouldn't stop because it was driving itself, and the driver was sleeping. So, they had to, they had to, you know, call up Tesla and say like how can we manipulate this technology so the car actually stops, so the police gradually got the car to stop. And, uh, you know, finally the guy woke up and uh, he'd probably had one too many. But he claimed he wasn't driving, so they shouldn't charge him, but, they did. (laughter) >> Of course, yes. Well bots are getting better, but I still, I still often know when I'm talking to a bot, but it's getting better, wouldn't you say? >> Christian: Yeah, it's getting reallly good. >> Paul: I know, last year I was completely fooled by a fundraising bot. But, I got a phone call from a bot that I spoke to for ninety seconds before realizing it was a bot. (laughter) So it's, its getting pretty good. As you look at, at the technology that excites you, about what you're bringing with your product, you talked a lot this morning about different kinds of technology and how you want to be a leader. What technologies excite you the most about the markets you are serving? >> I tell you what excites me the most is to work through the different levels of, of, uh, digital transformation that I talked about. I'm excited about the reflection between businesses and technology. I'm excited about the reflections between people and experiences, and I'm excited about the reflections between automation and efficiency. We have a lot of technology at our hands, That can help us achieve these different things. But, at the end of the day, it's the outcomes that matter. The technologies are exciting and you know, I can get super geeky about a lot of different technologies. But if it doesn't relate to any, any, not technical vision of product, but any business vision you have on what you actually want to do with it as a business, then I think it becomes dangerous. But, of course we have our geek sessions, where we geek out on all these different things. But, we try to separate that from when we actually, uh, you know, designing and building things directly into the product. But we need the geek sessions to get inspired. And understand what is available, so we can put it in the context of what our customers need today and also what they'll be needing in the future. >> Since you have some decent observation space and digital transformation, I want to ask a question. Uh, uh, our partner ETR, they have a data platform. And I was down in New York last week just talking to them and, one of the theories is, is so spending is starting to slow down a little bit overall on the macro. One of the theories is that digital transformation in the last two years, there's been a lot of experimentation. So a lot of try and, you know, everything. And now they're going into the production with, with what they, what they feel will delivery business value. And two things are happening is their premise. One is, they're narrowing down the focus on new technologies and make, making bets for all the disruptive technologies. The other is, a lot of the legacy stuff, they are pulling out. Saying, "okay, we're moving on." Um, are you seeing that, are you seeing this sort of... That, the bell weathers anyway going heavy now into production with digital transformation. What are you seeing? >> I think its a progression. >> Dave: Uh huh. >> I think it's scenario based. I don't see, I don't see companies making like, an all out bet from one day to another. >> Dave: Just mixed. >> It's mixed and I think you need to take a cautious approach because, you know, you don't, you... When you're in the technology world, you don't always get it right in the first go, we certainly don't get it right, the first time all the time, right? So, often times its important to get something out there. Learn from it, innovate, fail fast sometimes. Um, the worst thing you can do is not acknowledge when you have mad a mistake, And I think that is a risk that some companies also, bear with digital transformation is... If you need to adjust what you, what you thought was the right thing to do, make the adjustment as quickly as possible. >> Dave: You talked in your keynote about tailoring solutions and I want to understand your philosophy. How dogmatic are you, uh, uh, about, uh, not making customizations versus allowing your customers to make those, those tailored? And, and how do you manage that from a, you know cloud and SaaS delivery, evergreen, I think you call it stand point? >> Christian: We, we, absolutely believe that customers should have solutions that match exactly what they need and so forth. We also heard from stage today that, a good philosophy, I really subscribe to that philosophy, that if you're doing things that, you know, is not really differentiating you as a company or something just use a standard process. Why do something custom if it doesn't mean anything. Then you can adjust your processes to that. But if you have things that really differentiate you as a company, you obviously want to have the technology that supports that. And since that is differentiated, you're not likely to have a standard package file. So in that process, what we need to enable is, we need to enable these scenarios where you can extend, uh, we call it extend on the inside, extend on the outside, but you can achieve what you want but, do it in a way where, you do it in a declarative way. Not by creating or modifying code. So instead we want to make sure that our, the code that we have, that is part of the standard product, can actually interpret declarative code. And that means when we have upgrades and all that stuff, we upgrade the core but the declarative code that the customer has that is, specific to them, remains there and stays there. >> Dave: And that's why the API platform is critical. >> Paul: Right. >> You said no product will be announced or shipped without API enablement, period the end. >> That's correct, We can not because, we can not create a use of front end to anything that doesn't, that isn't API enabled. So, it's very simple. >> Paul: That's a modern architecture. I am curious about you said that one of the reasons that you're at IFS is because it's so customer focused. What is it that this company does differently from companies you've worked at in the past, that exemplifies that customer focus? >> Christian: I think it goes deep um, not only into the culture but also how we actually have people in, all the way in to the individual development teams. Um, I've been in other software companies and the development teams you have developers, you have QA's, you have, you know...testers, you have, you know... Programming just to write the specifications, so forth. We actually have industry solution specialists embedded into the development teams. So, we are, we are, probably our own, you know, worst critic um, and of course then working hand and hand with customers in their processes is essential. But again, if we don't provide the out...if we don't provide the value and the output from what we create for our customers, then it's worth nothing. And that's really the philosophy. If we do not provide value, technology means nothing. >> Dave: So the intersection of domain expertise and software development. Uh Chris, the last question is sort of, what do you hope to get out of this event? Things that you hope to, to take away, or learn or convey to your customers? >> Well I always, I always, look to get feedback. I'm a sucker for feedback and input and learning. Uh, so first of all, I can't wait to walk the expo floor here and really see what all our partners are bringing to the table of innovation. Because they're doing amazing things, so I always enjoy spending a few hours on the, on the expo floor. In the process, get to meet a lot of people, uh and then during the sessions if we can or I'll always end any presentation with an email address. Any, anybody, any customer, any partner will always be able to email me, uh directly, and I, you know... Sometimes a little hard to keep up, but I will respond to every single request. >> Dave: Feedback is a gift. Christian, thanks so much for coming on theCUBE, it was great to see ya. >> Thank you. >> Alright, thank you very much. >> Alright, thank you for watching everybody. Keep it right there, we'll be back with our next guest. We're at IFS World, Boston. You're watching theCUBE. (upbeat music)

>>live from Boston, Massachusetts. It's the Q covering I f s World Conference 2019. Brought to you by I >>f. S, I say, What a minute. I didn't cash it. Everybody welcome to I f s World 2019. You watching the Cube? The leader in live tech coverage on day Volante with my co host, Paul Galen. Marty Martin is here. She is the president of the service management division of I F s and C e o of work wave. Marty, good to see you. >>Yeah, it's great to be here. I'm so excited. >>A lot of action going on. You guys. Service management, Field Service management particular. You guys had an acquisition today. We're gonna talk about Let's start with your role you came in and 2017 with the >>pretty acting. Actually, >>2018 finalized the acquisition. I think they announce it in 2017. So tell us about how you came in and where you're at today with >>Certainly. So work wave the company. I lied. Join the effects family in 2017. Darren Ruess, who joined I f s in April 2018 recruited me into form a global business unit around service in August of 2018 and the reason why we did this is service isn't only a part of our economies all over the world, but it's a super great growth area that almost every business can go after in in progress both revenue and margins. So we had a lot of great software products, and we really wanted to improve our go to market around this. >>So why, why all of a sudden today, this talk about service management? Why's it becoming so hard? I mean, everybody's always been focused on customer service, but why this service management generally and field service management while the buzz. >>So first off, you've had the evolution of a number of line of business applications and service certainly has been a part of maintenance organizations or break fix where you're going out in repairing thing. What we're realizing now when you talk about service ization, how o E EMS air building what's called aftermarket revenue? There is literally $100 billion of revenue that you can get from that you look, we had Melissa did a nano from Souza. If you think about open source software, they make money from sirve ties, ing, open source software and the products. You look at apple how they're doing APs. So people are starting to realize that service is an engine for brand loyalty, customer experience, not just a cost center. How it used to be, what the >>customers do. Ah, companies do wrong with service one of the areas where they tend to have the greatest inefficiencies where you can help him. >>So first off, I'd say that often in the C suite, unless they're pure place service companies. They don't understand how transformative service is and how important it is to their brand. Many times now, if you have digital enablement of a new customer, the first time they see a face of your brand might be your service technician. So getting the awareness of the C suite is Step one, because we want to start talking about outcomes that grow revenue and profits and getting them to invest in service. So you know, many times will say, Oh, I want to do a C. R M project. I want to do an E r P project. That's certainly things were good at it. Here I a fest, but we can coach them through how you take the market opportunity for your company and service enabled by our technology and transform. Tomorrow I'll be with Accenture, one of our many great partners, and we're talking about adapting the business, the service transformation, sometimes digitally, sometimes with workflow transformation. But that opportunity and service is huge and almost never. There's no company I know of that's taking 100% of their service market share. That's the difference, especially in slower growth. Asset manufacturing are more mature verticals. >>So I was here last night walking the floor, and I went to the extent you Booth, you know, anytime you see, except you're in a show like this. Okay, Censure. You think Large company Global. I was actually quite impressed a little bit surprised to see you know, their presence here because they they go where the money is, right? And so my specific question is, think, except you think big companies. But you guys obviously focused on what range of companies smaller midsize company. So what's the landscape? Looked like? What's the difference is between sort of smaller and larger companies, >>so that's a great question. I'll take it in part So if you think about a neck censure definitely they looked a large. I also have had meetings with the Lloyd McKinsey Cap gem and I dxc etcetera Also tcs Tech Mahindra which a little bit or more telco focused. So if you think about at the very large and you have telco utilities, large manufacturing O e ems that our customers and definitely the customers I'm pursuing Maur with this focus But we also with work with go down to the S and B We had panels also of, for example, female owners of franchises and also males as well that are creating new service businesses and they're starting maybe with one truck in out providing service. So the fact that we can handle not only the breath and depth of complex service needs, but through work wave we also can encourage the small service businesses to reach their full potential is fantastic. And you know that makes me excited every day. And part of why I focused on service specifically is you are delighting customers. You are the face of a brand and you're making a difference. It's not something that s 02 is esoteric. This is about really value that we're delivering, >>always interested in the dynamics of serving the SNB market >>because one of >>these small companies don't really have that. Maybe family owned there found her own. They don't really put a lot of value on technology. How >>do you >>get in the door? How do you convince them that automating the service function is actually worth the investment? >>Well, first off, I'd say that even the big companies are struggling to go paperless. Okay, so, you know, I think some of the challenges we see survive, if you will, big to small, especially when you look globally in different countries. What have you. But the approach we take in the S and B is that we want to be a software as a service provider, and we were to really handle everything they need in their business. So everything from how they grow leads how they have c r m type functionality. How, then they're delivering service, how they're cross selling service, how they're billing service. So at the at the S M B level, we're putting that kind of all in one technology and there's really not that much integration or I T Service is around that right. We want it to be easy and fast, etcetera, as you go more into the mid market and then definitely into the enterprise. Then you start getting more complexity. You get more I t service's integrations, more configurable ity, sometimes even some customized software. So there is a definitely a difference in the complexity. But the fundamentals of what a service business needs really isn't that much different to your >>customers that you mentioned customize and you guys were SAS space. That's one of the text that we'd like to sort of explore a little bit. A lot >>of >>times SAS companies want to avoid, you know, custom mods. But at the same time, you guys are trying to offer a choice. So help us square that circle. How do you What's the conversation like with customers in terms of how you advise them, You guys obviously do a lot of deep functionality, you know? How do you sort of advise them whether or not to go heavily custom or try to go out of the box? >>Certainly. So in the true, I'd say the small business of a medium you start getting some crossover, but in the small business, Absolutely avoid customization because you won't be able to stay evergreen. It's going to be too hard to maintain. You don't have the subject matter experts, et cetera, so that's really a truce. Ask that from a community. A product engagement. We need to be driving the partnership with the customers that they can use a software out of the box in ways that matter to them. As you start getting into the mid market and especially the enterprise, then it becomes more of a choice, right? How much money do you have to spend? How robust is your organization and set trek? And in general, I advise customers if they care about evergreen software, et cetera. If they care about ease of upgrades, don't customize that Being said, we recognize sometimes in the field with your brand experience Custom mobile. You may need to customize a little bit, so it's Ah, say, a chicken and an egg. You have to weigh the benefits of the costs, and that's what we work through with our >>customers. Specifically morning. What's the upgrade cycle like? There's a customer having the choice Thio upgrade at a particular time, Or do they have a window? >>So it varies primarily, there's a few exceptions, but in general, with the work way, Family of products is true SAS. So it's almost like you're Apple Phone. We pushed the upgrade and you have to take it. Okay, And that's the true SAS model at I. F. S. And this is something Darren talked about in his keynote. We pride ourselves on offering choice. So even though we do have regular release cycles, we encourage customers to upgrade regularly. They have the choice on when they take upgrades and also how they deploy. We have some markets with things like data, privacy and what have you that they may, for that reason or for other reasons, go on premise even still today. So we give them the choice on how they upgrade as well as where they host. >>I'm fascinated by your product line. You have products for pest control. H V. A. C. Plumbing cleaning service is long and landscape. How different are these industries really in terms of their their automation needs? >>Well, I'll tell you one of the personal factors that Darren wanted to make sure I was comfortable with was multitasking. And that definitely is the case, because an I f s, we serve five key industries. So if you think about manufacturing utilities, telco service providers and Andy Okay, that's more at the enterprise level. If you think then when you go toe work wave. Those verticals that you mentioned are all the ones we service at work wave, and they are different. So you know what? Work wave. It's primarily service industries where you're going into ah, home and a little bit The commercial aspect and I effects were also doing more some heavy industries, some very large asset base, things like that. So I like to think about it as a product I service consumer based service. And then you can also differentiate across verticals with what are called high value assets versus, you know, Mork consumer size assets. >>So what >>are >>the one of the key technology enablers that are driving service management today? I mean, obviously, cloud, we talked about sas a lot of push on you X and customer experience, but what other key ones? >>So all the three that you mentioned mobile is huge. You know, Pete and even today, like I run. I work mainly from my phone, and that's really what people want. They want efficient work flows that are configurable on mobile, tied to the customer, the asset, the business. And that's an area that we're continuing to make investment. We also try to prioritize how we bring in the new technology trends into service. Because every technology trend that you see has applicable ity and service supply chain and how you run spare parts specially globally, you can see applications for Blockchain augmented emerged Reality how you can connect the field tech with an expert resource or remote resource to the consumer. That is obvious, right? So you talked about the enabling technologies like Cloud, how we're thinking about data platforms and Data's the currency. Of all of that, we need to d'oh. His service is really about a an execution engine, right? Because to deliver a customer experience that makes people come back to your brand. To purchase Maur, you need great service, so any time somebody talks about customer experience, but they don't talk about service. I want to say you're really naive because you can just get the customer. You have to delight the customer. >>Uh, the, uh, there's a lot of interesting technology going on now in the area. Fleet Management making fleets more efficient How does that figure into the service is? You offer. >>So Fleet management is an important part, and it's one that you have a very tangible return on investment when you deploy route management route optimization, fleet management. So you have the aspects that are very tangible, relate to how do you get the person or the truck where it needs to be when it needs to be okay, and that's pretty well understood. Then how do you get the most efficient schedule that minimizes miles driven gas, used et cetera? And then, of course, you also are thinking about health and safety. There's some cool things now that you can partner that if you have these fleet technologies installed in a way that is integrated in your service business, you can actually get lower insurance premiums, right? So it's not just the conventional use. Cases were starting to think in this kind of gig economy, how you can also be thinking about bringing in Maura what's called a contingent workforce. So if you have surge capacity in a certain period or you want to just do more third party service, probably your appliances. You know they're not the employees, if you will, of a g e or a world polar and LG right there Probably a contingent workforce. And that's a model that's also evolving. But to do Fleet Management across say, contractors, not just employees is an area that were thinking more and more led by some of the uber ization, if you will, of the of the marketplace >>right up against the clock, Marty. But to last questions You made an acquisition today, Vashti Uh, yeah, uh, I thought of it as a tuck in acquisitions, although Darren essentially sort of said, it's gonna make you the leader now in service management. Um And then I want to understand how you guys differentiate from some of the big whales. >>So, you know, overall, we're on track to be about 700 revenue this year in service management. We're working to get to 200 million, right? So this year will probably be around maybe 1/5 50 ish per se. Don't quote me on that check with our coms team, but the point being is that we have the ability to use these tuck in acquisitions and service to accelerate our lead, not just from a revenue perspective, which is what we were just talking about. But from a product perspective, you might have followed Salesforce acquiring Click. That means we are the only independent. Aye, aye. Optimization engine that is field tested. Battle ready. So that's great. This s t a is how we consolidate our dominance and complex service. So what darren was speaking to is not on Lee the service management segment of our revenue and how we continue to accelerate over the oracles in the S a. P s and the service maxes et cetera of the world. But how we take what we're already dominant in and really put the hammer down. Honesty is part of that. >>Your differentiation then if I infers, is focus. Um, you're you're deep customer customs agent deep >>domain expertise. Yeah, So really, when you think about a i optimization, which drives a ton of business value and the ability to handle the complex service cases that then drive business outcomes and outcomes based service models, we are number one and s dea tucks into that, even though it is very strategic on how we position ourselves with leadership and service. >>All right, Challenger becomes number one, Marty. Thanks very much. All right, Keep it right, everybody. Dave A lot with Paul Galen. You're watching the Cube from Boston Mass. I f s world 2019 right back.

>>from Boston, Massachusetts. It's the Q covering I. F s World Conference 2019. Brought to you by I F s. Hi, buddy. Welcome to Boston. You're watching the cubes coverage of I s s World in the Heinz Auditorium in Boston. I'm Day Volonte with my co host, Paul Gill and Paul. This is the the largest enterprise resource planning software company that our audience probably has never heard of. This is our second year covering I f s World. Last year was in Atlanta. They moved to Boston. I f s is a Swedish based company. They do about $600 million in annual revenue, about 3700 employees. And interestingly, they have a development center in Sri Lanka, of all places. Which is kind of was war torn for the last 15 years or so, but nonetheless, evidently, a lot of talent and beautiful views, but so welcome. >>Thank you, Dave. I have to admit, before our coverage last year, I had never even heard of this company been around this industry for more than 30 years. Never heard of this company. They've got 10,000 customers. They've got a full house next door in the keynote and very enthusiastic group. This is a focus company. It's a company that has a lot of ah ah, vision about where wants to go some impressive vision documents and really a company that I think it's coming out of the shadows in the U. S. And it will be a force to be reckoned with. >>So I should say they were founded in the in the mid 19 eighties, and then it kind of re architected their whole platform around Client server. You remember the component move? It was a sort of big trends in the in the nineties. In the mid nineties opened up offices in the United States. We're gonna talk to the head of North America later, and that's one of the big growth areas that growing at about three. They claim to be growing at three x the overall market rate, which is a good benchmark. They're really their focus is really three areas e r. P asset management software and field service management, and they talk about deep functionality. So, for instance, they compete with Oracle ASAP. Certainly Microsoft and in four company we've covered in four talks a lot about the last mile functionality. That's not terminology that I f s uses, but they do similar types of things. I'll give you some examples because, okay, what's last mile? Functionality? Things like, um, detailed invoicing integration, contract management. Very narrow search results on things like I just want to search for a refurbished parts so they have functionality to allow you to do that. Chain. A custom e custody chain of custody for handling dangerous toxic chemicals. Certain modules to handle FDA compliance. A real kind of nitty gritty stuff to help companies avoid custom modifications in certain industries. Energy, construction, aerospace and defense is a big area for that. For them, a CZ well as manufacturing, >>there's a segment of the e r P market that often is under uh is under seeing. There's a lot of these companies that started out in niches Peoples off being a famous example, starting out on a niche of the market and then growing into other areas. And this company continues to be very focused even after 35 years, as you mentioned, just energy aerospace, a few construction, a few basic industries that they serve serve them at a very deep level focused on the mid market primarily, but they have a new positioning this year. They're calling the challengers for the challengers, which I like. It's a it's a message that I think resonates. It's easy to understand there position their customers is being the companies that are going to challenge the big guys in their industries and this time of digital transformation and disruption. You know, that's what it's all about. I think it's a great message of bringing out this year. >>Of course I like it because the Cube is a challenger, right? Okay, even though we're number one of the segments that we cover, we started out as a sort of a challenger. Interestingly, I f s and the gardener Magic Corners actually, leader and Field Service Management. They made an acquisition that they announced today of a company called Asked. He asked, U S he is a pink sheet OTC company. I mean, they're very small is a tuck in acquisition that maybe they had a They had a sub $20 million market cap. They probably do 25 $30 million in revenue. Um, Darren rules. The CEO said that this place is them is the leader in field service management, which is interesting. We're gonna ask him about that to your other point. You look around the ecosystem here that they have 400 partners. I was surprised last night. I came early to sort of walk around the hall floor. You see large companies here like Accenture. Um and I'm surprised. I mean, I remember the early days when we did the service. Now conferences 2013 or so you didn't see accent. You're Delloye E Y p W c. Now you see them at the service now event here that you see them? I mean, and I talked to essential last night. They said, Yeah, well, we actually do a lot of business in Europe, particularly in the Scandinavian region, and we want to grow the business in the U. S. >>Europe tends to be kind of a blind spot for us cos they don't see the size of the European market, all the activities where some of the great e. R. P. Innovation has come out of Europe. This company, as you mentioned growing three times the rate of the market, they have a ah focus on your very tight with those customers that they serve and they understand them very well. And this is a you can see why it's centuries is is serving this market because, you know they're simply following the money. There's only so much growth left in the S a P market in the Oracle market. But as the CEO Darren said this morning, Ah, half of their revenues last year were from net new customers. So that's that's a great metric. That indicates that there's a lot of new business for these partners to pursue. >>Well, I think there's there's some fatigue, obviously, for big, long multi year s AP integrations, you're also seeing, you know, at the macro we work with Enterprise Technology Research and we have access to their data set. One of the things that we're seeing is a slowdown in the macro. Clearly, buyers are planning to spend less on I T in the second half of 2019 than they did in the first half of 2019 and they expect to spend less in Q four than they expected to in July. So things are clearly softening at the macro level. They're reverting back to pre 2018 levels but it's not falling off a cliff. One of the things that I've talked to e t. R about the premise we put forth love to get your thoughts is essentially we started digital transformation projects, Let's say in earnest in 2016 2017 doing a lot of pilots started kind of pre production in 2018. And during that time, what people were doing is they were had a lot of redundancy. They would maintain the legacy systems and they were experimenting with disruptive technologies. You saw, obviously a lot of you. I path a lot of snowflake and other sort of disruptive technology. Certainly an infrastructure. Pure storage was the beneficiary of that. So you had this sort of dual strategy. We had redundancy of legacy systems, and then the new stuff. What's happening now is, is the theory is that we're going into production. Would digital transformation projects and where were killing the legacy stuff? Okay, we're ready to cut over >>to a new land on that anymore, >>right? We're not going to spend them anymore. Dial that down. Number one. Number two is we're not just gonna spray and pray on all new tech Blockchain a i rp et cetera. We're gonna now focus on those areas that we think are going to drive business value. So both the incumbents and the disruptors are getting somewhat affected by that. That slowdown in that narrowing of the focused. And so I think that's really what's happening. And we're gonna, I think, have to absorb that for a year or so before we start to see new wave of spending. >>There's been a lot of spending on I t over the last three years. As you say, driven by this need, this transition that's going on now we're being going to see some of those legacy systems turned off. The more important thing I have to look at, I think the overall spending is where is that money being spent is being spent on on servers or is it being spent on cloud service is, and I think you would see a fairly dramatic shift going on. They're so the overall, the macro. I think it's still healthy for I t. There's still a lot of spending going on, but it's shifting to a new area there. They're killing off some of that redundancy. >>Well, the TR data shows couple things. There's no question that server and storage spending is has been declining and attenuating for a number of quarters now. And there's been a shift going on from that. Core infrastructure, obviously, into Cloud Cloud continues its steady march in terms of taking over market share. Other areas of bright spots security is clearly one. You're seeing a lot of spending in an analytics, especially new analytics. I mentioned Snowflake before we're disrupting kind of terror Data's traditional legacy enterprise data warehouse market. The R P. A market is also very hot. You AI path is a company that continues to extend beyond its its peers, although I have to say automation anywhere looks very strong. Blue Prison looks very strong. Cloudera interestingly used to be the darling is hitting sort of all time lows in the E. T R database, which is, by the way, that one of the best data sets I've ever seen on on spending enterprise software is actually still pretty strong. Particularly, uh, you know, workday look strong. Sales force still looks pretty strong. Splunk Because of the security uplift, it still looks pretty strong. I have a lot of data on I f s Like you said, they don't really show up in the e t R survey base. Um, but I would expect, with kind of growth, we're seeing $600 million. Company hopes to be a $1,000,000,000 by 2022 2021. I would think they're going to start showing up in the spending >>service well again in Europe. They may be They may be more dominant player than we see in the US. As I said, I really had not even heard of the company before last year, which was surprising for a company with 10,000 customers. Again, they're focused on the mid market in the mid market tends to fly a bit under the radar. Everyone thinks about what's happening in the enterprise is a huge opportunity out there. Many more mid market companies and there are enterprises. And that's a that's been historically a fertile ground for e. R. P. Companies to launch. You know J. D. Edwards came out of the mid market thes are companies that may end up being acquired by the Giants, but they build up a very healthy base of customers, sort of under the radar. >>Well, the other point I wanted to make I kind of started to about the digital transformation is, as they say, people are getting sort of sick of the big, long, ASAP complicated implementations. As small companies become midsize companies and larger midsize companies, they they look toward an enterprise resource planning, type of, of platform. And they're probably saying, All right, wait. I've got some choices here. I could go with an an I F. S, you know, or maybe another alternative. T s a p. You know, A S A P is maybe maybe the safe bet. Although, you know, it looks like i f s is got when you look around at the customers, they have has some real traction, obviously a lot of references, no question about it. One of things they've been digging for saw this gardener doing them for a P I integrations. Well, they've announced some major AP I integrations. We're gonna talk to them about that and poke it that a little bit and see if that will So to solve that criticism, that what Gardner calls caution, you know, let's see how real that is in talking to some of the customers will be talkinto the executives on members of the ecosystem. And obviously Paul and I will be giving our analysis as well. Final thoughts >>here. Just the challenge, I think, is you note for these midmarket focus Cos. Has been growing with their customers. And that's why you see of Lawson's in the JD Edwards of the World. Many of these these mid market companies eventually are acquired by the big E R P vendors. The customers eventually, if they grow, have to go through this transition. If they're going to go to Enterprise. The R P you know, they're forced into a couple of big choices. The opportunity and the challenge for F s is, can they grow those customers as they move into enterprise grade size? Can they grow them with with E. I. F s product line without having them forcing them to transition to something bigger? >>So a lot of here a lot of action here in Boston, we heard from several outside speakers. There was Linda Hill from Harvard. They had a digital transformation CEO panel, the CEO of soo say who will be on later uh PTC, a Conway, former PeopleSoft CEO was on there. And then, of course, Tony Hawk, which was a lot of fun, obviously a challenger. All right, so keep it right there, buddy. You're watching the Cube live from I F s World Conference at the Heinz in Boston right back, right after this short break.

>> Voiceover: Live, from Atlanta, Georgia, it's theCUBE. Covering IFS World Conference 2018. Brought to you by, IFS. >> Rebecca: Welcome back to theCUBE's live coverage of IFS World Conference 2018 here in Atlanta, Georgia. I'm your host, Rebecca Knight, along with my co-host, Jeff Frick. It's been a great day here. >> Jeff: Yes. >> We've had a lot of wonderful conversations, great panels. Last one to go, you can tell the atmosphere is getting... >> They're wheeling out all the alcohol I think... >> Exactly. Exactly. >> ...for the reception this evening. >> But we have saved best for last. We have Dan Matthews, who is the CTO of IFS and Bas De Vos who is the Director of IFS Labs. So Bas and Dan, thanks so much for joining us. >> Thank you. >> You're welcome. >> So, when I talked, we've heard a lot about IFS Apps 10, and this is the big news, but what we haven't talked about too much is Arena. Can you describe to our viewers this new user experience, and what it means? >> Alright, well, IFS Arena, like you said, it's a new user experience via past applications, and that's something that's really important to us because it's important to our customers. Because what they want to do is, they want to put great tools in the hands of the people, right? And we all know when it comes to software, how great a tool is is a large part down to the user experience, so that's why we've done it. And what we've done is create something that we think is more inspired by really well-designed consumer software, but we've adapted that for these big enterprise applications like we are doing. >> It's pretty amazing in your keynote because you showed, I think five different UI's based on different devices in the prior versions, where now you're coming to kind of a standardized single (mumbles) experience across various platforms or across various devices to actually interact with the applications. That's got to be, feel good to get that down to kind of one responsive design. >> And to a degree, that's just rescinding to reality because you used to think about, you had your PC and you had a way of doing that. And then you go to your mobile app, or maybe, I mean, people are using so many different kinds devices today. So if we were to purpose build something just for your iPad, something for your phone, something for this, something for your TV, we'd be stuck forever, right? So what we did instead, is we said, "Let's build one experience that actually adapts "to all these different environments, "and get that really, really well." It's not that easy, but in the end, it's a much better way of approaching it. >> Right, and I thought the part that I liked was as when you're new to something, you don't necessarily want a high density of information in a screen or whatever, 'cause you're just not sure, you're learning, whatever, it's new. But then as you become more experienced, obviously your comfort zone goes up, you want a lot more dense information, and really, in your work platform you demoed earlier today, you have a lot of options whether you want kind of the more consumery, more picturey, less efficient way, or do you want the "I know this well, "and I want the thick content." >> And what we basically does, we flipped it upside down, 'cause if you look at Enterprise Software, and ERP, and has to management this kind of stuff, it always used to be designed for the professional, right? And then you would try to simplify it for the newbies that're coming into the business. Can we remove some things, hide some things away, configure some things? Now we've done it the other way around. So the default is it's designed for the novice person that's just coming in seeing this for the first time. And then as you learn, as you say, you can expand and grow, and they get sort of more rich in the data you're seeing. And this is really, really important right? Because people aren't staying that long in the jobs anymore. So if you think about people moving around, they know the business, but they might not know the business applications, so they basically come in, I'm a purchasing guy, come in, pick up the purchasing system directly, that's really really important. >> Needs to be intuitive? >> Yeah, make it intuitive first, and then progressively let people discover more, rather than give all the options and all the complexity and then expect them to simplify it. That's harder. >> So, Bas, I want to talk to you a little bit about the development process and how you come up with these kind of things. Can you describe how it works at IFS Labs, what approach you take? >> Yeah of course, and then perhaps Dan can add to this a little bit later as well. But because IFS Labs is just a part of the process, right? But if you look in our general development process, for us, it's very important to stay close to our customers, right? What do our customers need today? What do they need tomorrow? And we have to basically be able to deliver functionality they need for their problems right on time. And IFS Labs plays a part in that. We are basically (mumbles) for sending before that. So we approach it a little bit the other way around. So instead of looking at a customer problem and trying to find a solution for that, we basically look ahead. We look a couple of years in the future. What kind of technologies are coming up? What kind of possibilities are there, and can we find a problem for it? And that sounds strange, right? Because we're known in the business of finding problems. But it does allow us to experiment and come up with innovative solutions that might work for tomorrow. But before we actually move that into production, or hand it over to regular R&D development, well we do step back and go to our customers and say, "Hey wait a minute, this is what we are thinking Labs, "what do you think about that? "Does it work for you, does it help you?" and validate it with them. >> So it's an interesting challenge for Labs, for looking down the road, because, and Steve Jobs' famous quote, that we don't necessarily deliver just what our customers ask for. They're not asking for things that are down the road, so you got that responsibility to look down the road. On the other hand, nobody likes technology that doesn't have a problem to solve. So you got to be delicate. Because if you just build something for the sake of building something, maybe there's some ancillary value. But at the end of the day, someone's got to use it and they got to drive direct values. So how do you kind of play that balance beyond, "Yes we listen to customers, "but there's this other stuff coming "that maybe they're not too aware of"? >> Yeah that's true, totally true, I completely agree with you. And I think that is the role of IFS Labs, right? So if we look in the overall process, the fact that we have a Labs, we don't... A license to experiment with trying out stuff, validating it with our customers, we can basically... Try it out before we actually take a decision to build something that our customers are not waiting for. So exactly the problem you just sketched, I think that our interest, IFS Labs, to resolve that. >> We have seen this happening throughout history, right? So if you look at how IET started, for us, it started with a product in IFS labs, when together we want a customer learning and understanding how they should be applied to the kind of businesses and industries that we serve. And then it went into mainstream R&D development and then we have real solutions, and now we have customers, who've been live for years, using this kind of stuff. So that is exactly the process you want to have. Try it out, and when we have a grasp on how this relates to our customers, then we up the next level of investment and take it further. >> And then, similarly, we had a project in IFS Labs that, well we tried out, and after a couple of months or even longer we said, "This is not going to work "for our customers, it's actually not helping them today. "Might be a couple years from now, but today let's stop it." >> So was this how your kind of integration of AI and machine learning into the applications took place? You looked forward, this is a cool new thing we need to play, but at the same time, we're not going to name it after a smart dead guy. (group laughing) But really bake it into the applications where it makes the most sense. And that sounds like it's kind of your execution strategy. >> Yeah definitely and AIs are a very, very, very big topic, right? It's an umbrella for so many different types of applications. Dan was talking this morning about three main areas where we think AI makes most sense for our products. It's basically human-machine interaction, predictive maintenance and service, an automation. But each of those areas, they basically have their own... Own life cycle, right? So if you look at human-machine interaction, at the morning. This morning we were talking about the IFS Arena bot. We're actually in a proper development phase. So that's much further ahead in that cycle, while other AI related topics like doing mass-automation, only your (mumbles), that's earlier in the cycle and that's still in Labs. So although AI is a big umbrella topic, the different topics in there follow that same approach. >> Can you be a little more specific about the projects you're working on, or is it top secret? >> At the World Conference everybody wants to know our secrets, but luckily, at World Conference we share them. >> Jeff: This is between us four. >> Yeah nobody's listening, right? Or watching? (laughs) So yeah at this World Conference we're hosting an innovation area. And in the innovation area, we're showcasing a wide range of basically possible technologies and how you could apply them to future business. We basically took the approach of depicting an end-to-end automatous business. So basically go all the way from mining stuff, in a mine in the ground, to using that in a factory, to producing products for the customer. And we basically build all kinds of technologies in there to make that completely automatous. Might not all be possible today, but it's really there to inspire our customers to look ahead. Some examples of the things we're using, a block chain inside enterprisesque management, mixed reality with Microsoft HoloLens to do service repairs, digital twins in virtual reality, automatous vehicles. So there's a lot of interesting stuff going on there. >> That's great, those are the great buzzwords but you put them all within application, and they're just standalone. >> Dan: What it does really well, is it kind of illustrates how these technologies are used in context... >> Right. >> Dan: With all of these things. >> That's super. >> You are an IFS veteran, >> Yes. >> You came as a developer and now here you are, CTO. Tell our viewers a little bit about how the company has changed in your opinion, and also now as you are sort of making a bigger push into North America, what we can expect. >> Well, what else changed, if I go back and I've not been with this company for more than 20 years. But what I've seen is we've got a lot more professional. Of course, we're a big organization now, and the way we run things and the way the business is run is a lot more professional. If you go back to the late '90s, this was before the dot-com boom, everybody was pouring money into the IT industry, so that was not an objective. So we were doing R&D but we were also burning money. And I think after that bubble burst, we all learned to become proper business people as well. I'll tell you one that hasn't changed, though, and that really is the kind of atmosphere that is within the company, right? How close we are to our customers, and how the customers reality always comes first and how we all help each other support. That really hasn't changed despite the fact we're so much bigger and we're 20 years old and all that kind of stuff. >> So why do you think is it 'cause maintaining culture is really, really difficult and we go to a lot of shows and we often talk about if it's a founder-led, and if they're a good CEO to double benefit, to keep that culture, but when you got turned over at the top, how do you maintain the culture that you guys have built? >> I think in the beginning, I think it was a lot of that founder-led, right? It was really led by the founders and one of the founders was our CEO for many, many years. But then it kind of got ingrained a little bit, between the Scandinavia culture. That it's quite open, quite sort of friendly, helpful, lots of hierarchical. And that then sort of spread out as the business expanded into nationally. And we kept it also on the R&D side. We do a lot of R&D in Chalinka for example. Which has a surprisingly similar feeling in the culture, actually. So I think it just got so big and so strong in the company, that it just naturally, new people come in and naturally sort of carry on with that same way of being that we've had it before. >> Rebecca: They adopted and embraced it. >> Because that was the end, Dan said when he was doing his due diligence, right? The culture was a huge piece of why he came to the company. >> I think if they were the other way around, we have seen that when we brought businesses in as well, that is, right, these guys have a similar culture to us, great, fantastic business to bring into to the IFS family. >> Jeff: Sir, you were going to say? >> I was going to say, in the end also, you're attracting people to your company and the people that are staying are also the people that feel at at home, and that feel comfortable, and that feel, I'm a little bit shorter than Dan inside the company for two years now. But basically, I feel the same with the culture, right? And it fits me as a person, and therefore I think I'm inclined to stay longer at IFS than if the culture would not fit me. And as you attract people with the same mindset together. It only gets stronger. >> Right, well Dan and Bas, thank you so much. This has been really fun last panel of the day, so we appreciate it. >> Thank you. >> Good luck on your keynote on Thursday. >> Bas: Thank you very much. >> I'm Rebecca Knight for Jeff Frick. This has been IFS World Conference 2018. We will have more after this. (light techno music)

>> Announcer: Live from Atlanta, Georgia, it's theCUBE, covering IFS World Conference 2018. Brought to you by IFS. >> Welcome back to theCUBE's live coverage of IFS World Conference here in Atalanta, Georgia. I'm Rebecca Knight, your host along with my co-host, Jeff Frick. It is late in the day here, the reception is about to start, the drinks are flowing, but we are still interviewing guests, and we've got a great panel right now. Joining us is Scott Helmer. He is the Senior Vice President at the Aviation and Business Defense Unit at IFS, and Henry Canaday, who is a contributing editor at Aviation Week. Thank you both so much for joining us. >> Thanks for having us. >> I wonder if you could walk our viewers a little bit through the idea, where does aviation and defense sit within the IFS business strategy? >> I'm happy to answer that. I think our new CEO of IFS, Darren Roos, has been very clear that there are three things that IFS will be best at. Number one, we will be best at mid-market ERP in those vertical markets that we care about. We will be number one in field service management. And we will be number one in maintenance management solutions in aviation and defense. So aviation and defense is one of the pillars on which IFS's strategy is currently based, and we have formed a global business unit inside of IFS that is specifically responsible, it's a 300 person strong team that is responsible for distributing a comprehensive portfolio of A and D solutions to the A and D market globally. >> What are the some of the biggest challenges that you're setting out to solve for your customers? >> Also a good question. We address the full range of management solution capability across A and D. So whether you're an operator in commercial or defense sector, or whether you're an inservice support provider, we provide solutions and support, all of your MRO capabilities, some of your performance-based logistics requirements, some of your supply chain requirements. Basically leveraging the core processes that IFS is differentiated around. Those being manufacturing, asset and service management, supply chain and project management. >> What's special about aviation and defense that's not been marketed or service delivery, which captures a lot of industry verticals, but the fact that you guys got carved out as a separate vertical, what are some of those unique challenges? >> What is chiefly unique about aviation and defense is the overall complexity in the marketplace. You're talking about very very complex capital intense of mobile assets, where managing the maintenance obligations in order to maintain the availability of the aircraft is under the scrutiny of compliance and is required to be done efficiently, without compromising safety. >> Not to mention the fact, your assets are flying all over the world, so they might not necessarily be able just to roll into the maintenance yard at the end of a bad day. >> And they're large and expensive, that's for sure. >> (laughs) Large and expensive. >> Henry, you've been covering the aviation industry for more than 20 years now. What do you see as the biggest trends, biggest concerns that a company like IFS is trying to grapple with right now, in terms of servicing its clients? >> Well the interesting thing about the airline industry is that it technically in many areas it's extremely advanced and very fast moving industry. In selling tickets, the industry has been going through a continual IT revolution for the last 20 years. Things like giving you notices about when your planes arrive and stuff like that. Very fast moving, changing all the time. But this is stuff, it's just money. There's no safety involved, so they can take chances, if they get it 99% right, they make enough money, they can solve the one percent errors. The problem with maintenance is it's messy, it's complex as Scott says. It's also safety critical. They can't screw it up one tenth of one percent of the time. They've been very, very cautious and very, very slow, and they look sluggish and stagnant on the maintenance side. But fortunately, now, especially the U.S. airlines are making some good money, so there's actually an opportunity for companies like IFS to come in here and really reform the maintenance program. >> We cover a lot of autonomous vehicle shows. Autonomous vehicles are coming. Obviously, a big element of autonomous vehicles will ultimately be safety. One of the things that comes up over and over again, if you look at the number of accidents, the fatalities that happen on our streets, compared to what happens in aviation, if a week on the streets happened at a week in the aviation industry, the planes would be shut down. >> Scott: There'd be no aviation. >> The threshold that you guys have to achieve in terms of safety is second to none. I don't know if there's anything even close, especially in terms of volume of people, and then, oh by the way, everyone globally is getting richer, so the amount of passenger flow. I don't know if you can speak to that in terms of the growth of passenger miles, I imagine is the metric, continues to explode. >> You've had basically 18 straight years without a fatal crash by a major American airline. That's unheard of, that's unheard of. We used to have one crash a year up till around 2000. Every time somebody annoys me with customer service in an airline, I think of this, they're doing the important stuff right, so I don't care. (laughs) >> Very well. >> Right. >> And, then do you think the efficiency, right? At least here domestically, I always think of Southwest, 'cause they were the first ones that really had fast turns, and they raced to the gate, they raced back out of the gate, in terms of really trying to get the maximum efficiency out of those assets. The pressure there, in translating to the other airlines is pretty significant to make sure you're really getting a high ROI. >> That's absolutely right. Again one of the levels of complexity that we were discussing. Certainly airlines are being forced to finally introduce some change into their maintenance operations, as the increasingly complex assets are part of the re-fleeting, as that faster traffic continues to grow. It's about both achieving greater efficiency in maintenance operations, not only without compromising safety, but ensuring the availability of that asset. Because revenue dollars still matter greatly, and those assets are your revenue producing assets that an airline has. >> Can you describe your approach in terms of of how you work together with your clients, the airlines, in terms of developing new products and new features. >> One of the unique characteristics about aviation and defense is not only the size of the client, but the length and duration of the relationships. So, we have a long and rich history, both at IFS and through the acquired MXI technologies, of working with our partners in their programs over the very long term. As much as we have domain expertise and a sizable team of domain experts inside of our business, we're able to recognize our partners that are visionaries in the industry, and we have established multiple levels of collaboration to involve them in the shaping of solution capability to support their businesses going forward. We are just launching today two new planning applications that were not only being launched with American Airlines and LATAM Airlines respectively, but were co-developed with subject matter experts at each. So they're tremendously valuable inputs into shaping our vision of what solutions are going to best drive business value for our customers over a very long relationship horizon. >> So, what have you unpack at MXI acquisition, what did that give you that you didn't have before and what's the total solution now? >> Certainly, I joined IFS through the MXI acquisition. I was previously it's Chief Operating Officer. MXI was focused on best of breed MRO capability for both defense and service port providers, as well as commercial airlines. In combining with IFS, that had a rich history in A and D, we now have the most comprehensive solution portfolio available on the market today. We are the only vendor that can provide best of breed capability, integrated into an end to end enterprise landscape, and we've got the team of subject matter experts or domain experts that are capable of delivering that value, not just the product, but the solution to the customers across all the segments of A and D. >> Just to be clear, your defense is more than aviation. I saw a military truck over on the expo hall, so it's assets beyond just airplanes when it comes to defense. >> Correct, we support on the defense side of things. We support multiple platforms, whether they're fighter jets, whether they're cargo carriers, whether they tanks, whether they're ships, we support for the operators, the offset optimization, performance based logistics, security, et cetera. For the in-service port providers, we similarly support supply chain requirements, MRO requirements, et cetera. >> Henry, as you look forward, you've been covering this space for a while, what are some big, new things coming down the road in the aviation industry that we should be looking for, 'cause we haven't seen a lot of big things from the outside looking in. I guess we had the next generation fighter planes, and then we had obviously the A380 and the 787 on the commercial side. What's new and coming that you're excited about? >> Well, technology changes slowly in commercial aviation, because of the safety aspect. The big, new things are the new aircraft, the 787 and the A350. They are really new generation aircraft, lot more composites, plastics if you will. They're using that instead of aluminum. The other things that's happening is additive manufacturing, this whole printing parts. That's real big, and I've been telling everybody the new Boeing 787 has two printed parts, one made by GE, $120 billion a year. The other made by a company called Norsk Titanium, with 140 people coming out of Norway, which is not exactly the center of innovation in aerospace programs. >> Jeff: With a printed part, like a 3D printed part? >> Yeah a printed part. Those are the two big changes in the aircraft. I mean, customers aren't going to see it, but these planes are now made largely of plastics and the metal parts are going to be more and more printed. Much more efficient way, lighter aircraft, less fuel use, more efficient, less environmental effects, etc. That's a big deal. More important than a huge airplane. >> Right, well I can imagine, we hear about the impacts of 3D printing. I haven't really seen it yet, but this vision where your ability to print parts on demand will have significant impacts on supply chains and inventory and huge, huge impacts down the road. >> And the airline industry is the most demanding. They've go to go through really massive proofs of concept and proof of materials, and it's starting to happen. >> Henry, what would you say is the most important area that IFS should focus on. If they can solve one problem in the airline industry, what do you think it should be? >> Availability would be one. Just aircraft availability, that's what. The airlines are concerned about two things. Dollar cost per flight hour to maintain and what they call a technical dispatch reliability. They want to get that plane launched 99.99% of the time. Get rid of the unpredictive maintenance problems. Schedule everything, make it quick, I want to get the planes off on time. >> It's amazing that unscheduled maintenance, regardless of industry, still continues to be such a bug-a-boo to productivity and profitability. It's one of these things that just has huge impact. >> I would completely agree with Henry. I think asset availability is the number one focus for commercial operators. Our focus has certainly been around trying to remove the impacts of unscheduled maintenance. One of the applications that we launched today allows you to react very, very quickly to unplanned or unscheduled maintenance events, and to do some what-if modeling, so that you can implement the best plan for your fleet, in order to maximize the availability of that asset. Not just in terms of bolstering or producing a better plan. We're attempting to do that even with line planning, where we're adjusting the traditional planning perimeters away from what must be done to what should be done in order to maximize the availability of that aircraft. Of course, as Henry said, everybody's focused on faster, tighter turnaround times. All of our software is designed to try and drive tighter turnaround times and greater efficiency. >> What percentage is scheduled versus predictive versus prescriptive? Maintenance. >> I think it varies by airline. The great majority of maintenance is scheduled, I mean, there's no doubt about that. They put these aircraft down for a week or a month. It's a massive amount of money. It's not the amount of maintenance, it's when unscheduled maintenance happens, it really throws things off. It may only be one or two percent of the maintenance tasks are unscheduled, but that's what throws the aircraft off the schedule. That's what leaves passengers sitting in the departure lounges, ticked off. Not getting there till the next day or the next week, whenever, so it's a very, very small percentage, these unscheduled maintenance events, but it's crucial to the airlines' economics. >> Exactly. Crucial to our itineraries, as well, as the economics. Exactly. >> Making sure that the airlines continue to do what they do best, which is get us from place A to place B. >> Precisely. Well, Scott Henry, thank you so much, it's been a really fun conversation. >> I enjoyed being here, thank you. >> Jeff: Thank you. >> Thanks, Henry. >> Thanks. >> We will have more from theCUBE's live coverage of IFS World Conference just after this. (digital music)

>> Announcer: Live from Atlanta, Georgia, it's theCUBE, covering IFS World Conference 2018 brought to you by IFS. >> Welcome back to theCUBE's live coverage of IFS World Conference 2018, here in Atlanta, Georgia. I'm your host, Rebecca Knight. We have a three panel guest with us today. We have Eric Schaeffer, the Senior Managing Director of Accenture, Paul Maher, GM Industry Experiences at Microsoft, and Yasushi Yagyu, Assistant Manager at NEC Corporation. Thank you so much for joining me. >> Guests: Thank you. >> So you're on this panel because you are all platinum sponsors and close partners of IFS. We've heard a lot today about IFS's passion for customers. It's a customer-centric, customer-focused company. I'd love to hear from you, your experiences as being partners with IFS. If you could describe a little bit about what you've experienced. I'm going to start with you. >> Thanks, Rebecca. I think, we've been, Accenture and IFS have been partners for many many years, and what I've appreciated in the relationship is the customer focus, but really the focus on delivering value to both IFS and Accenture customers. It's a value-driven approach, very industry specific. So understanding the industry issues, leveraging IFS products and solution to best meet these, having Accenture come in and help tailor the solution to the industry imperatives, and also leveraging digital technologies and combining these with the IFS foundation, which I think was a key term used this morning. >> Yeah, I mean so... Microsoft and IFS have had a very long and prosperous partnership over the last 20 years or so. What's great here, from the keynote this morning is obviously the announcement of IFS Applications 10. And so Microsoft obviously, being a Cloud provider, we've most recently been working very closely with IFS on their move to the Cloud and moving their solutions to the Cloud. So you know, this thing called digital transformation is really, sort of the boss and it's great to see, you know, as you had probably this morning in the keynote, you know, really disruption is really driving new innovation and so we're really glad to partner with IFS in response to that disruption, thinking about Cloud and bringing the IFS Solutions to the Cloud, and really delivering innovation to really address the digital transformation needs of industry. >> And I'd love to talk about you, Yasushi, about innovation. I mean, I ask all of you, but this is a company that really is known for having a history of innovation. How do you come together and collaborate and come up with new creative solutions? >> Uh huh. For example, we have independently, we have AI engine. Namely HML is our engine. And our customer has already implemented that kind of AI solution to predict the demand forecast. And then... Our solution is connect to the IFS Production Control Module, or master schedule module. And then, now our AI can generate forecast data and send it to the master schedule module. >> I know that Accenture has innovation centers around the world. Can you talk a little bit about how you innovate with IFS? >> Well, so we have four innovation centers across the world. We have one in Detroit, one in Munich, Shanghai, and Tokyo. And what we do with IFS is look at industry use cases. And then by combining IFS solutions, plus some of the digital assets, which are proprietary to Accenture, combining the two to deliver new levels of efficiency. And so helping out clients, walking through these innovation centers, they get the "Wow" moment where they see how IFS plus Accenture combined can deliver more value and unlock the value which is trapped in their enterprise. >> Can you talk a little bit about that "Wow" factor? I mean, what are sort of... What are a lot of the challenges that your clients are facing, that you're partnership with IFS has helped them solve? >> Well, many of our clients and I think the term digital transformation of industry was mentioned, it is how is digital transforming the industry. I think the question is not the why. Everybody's convinced and has understood that it is happening. The question is more of the how to. And this is where the combination of IFS plus Accenture really focusing on the how to, how to leverage these technologies on very pragmatic use cases, demand forecasting we heard. It's all about artificial intelligence and visual and computer vision for visual quality inspections, analytics on the shop floor. So it's working with IFS and our clients, the team of three, to identify these use cases and see how to leverage digital to respond and provide a solution. >> At Microsoft, what kind of benefits have you seen with some of the IFS products? >> Yeah, I mean so, from a Microsoft perspective, of course, you know, we are the vendor, the technology vendor. Most recently we've been working very closely with IFS around the move to the Cloud. So I mean, certainly as I think about the partnership that we've had, it really is multi-faceted in terms of, of course we work very closely around how do we think about driving new opportunities and sales motions. And IFS is one of our highest ranked managed partners so we partner very closely there. But suddenly if I was to focus on the technology innovation perspective, what we're really excited about is really that digital disruption and using the new IFS applications, in particular, IFS Applications 10 that's been announced at the conference, working in partnership there to really look to see how do we start to move the needle and move new customers to really achieve to their digital transformation needs and demands, in partnership with the IFS solution running on the Microsoft digital Cloud. >> What are some of the most exciting new features in IFS 10 that you're most excited about? >> Yeah, I mean you mentioned before about the buzz words and the on-trend technologies and I'll kind of quote the keynote this morning, but what really excites me and excites our joint customers, IFS and Microsoft, is things like artificial intelligence, so what that can do around things like machine learning, cognitive services, things like IoT and making that a reality, so thinking about things like predictive maintenance and really being able to integrate the IFS solutions on the Microsoft digital platform, leveraging IoT to really help in those sort of scenarios is great. And then, really super excited about some of the new innovation opportunities. So thinking about things like block chain and what that can do, as you think about the broader opportunity around supply chain and payments and so on. So I think that closer together of the platform but also we've had such a close partnership with IFS, so thinking about really sort of a business problem-led approach, followed by how can the technology and innovation help our joint customers, I think is really helping us as we're looking to innovate in the world of digital transformation. >> And I know that NEC has recently come out with an announcement about AI and heterogeneous, mixed learning technology. Can you tell our viewers a little bit more about that, Yasushi? >> Yes, we have an engine, engine model. And our customer has implemented that kind of AI solution to demand forecast or machine failure prediction operations. And some of our AI solutions do collaborate with IFS predictions. For example, at NEC booth we can demonstrate our demand forecast solution. And information from each product comes from IFS master schedule or inventory transaction as input data into AI engine. And then AI generates forecast data automatically and sends it back to that module, yeah. >> So here, IFS, we've heard a lot today too, about the metrics, how it measures its success, and we've heard that it has very high NPS score, its Gartner Insights score is far above competitors, and yet it is kind of this best kept secret in the industry. What would your advice be to IFS in terms of getting the word out about its products? >> Yeah, I mean I think everyone's looking for opportunities to further their market share and drive that new innovation and sales pipeline. I think the best guidance I would give is that IFS really is a first-class company and has first-class products. I think it's continued to innovate and be true to the core and you know, just work with partners like good friends here to really get the word out. But it's really not about doing unnatural acts. I think it's really about building an empathy and understanding of what's needed in the industry and I think the story telling and brand awareness will grow. And I think, from what I was hearing this morning, I mean the conference even this year has already grown by 20 percent, so I think you'll see those sort of leading integrators of the word getting out and the brand profile out there. So I think it's a cautious approach, a strategic approach by using partners and not doing unnatural things. Let the innovation that's happening at IFS and with those partnerships, almost do the story telling and the brand awareness, and just be true to the competency and listen to the customers. >> Well when you think ahead at what we're going to be thinking about and talking about at WoCo 2019, 2020, what are sort of the big trends that you see? I mean we've hit a lot of the buzz words with AI and machine learning. What else do you see on the horizon? What's keeping you up at night or are you thinking about? >> Well what I do see is that, so we mentioned all these digital technologies, they will force manufacturers, I believe, to completely reinvent their products and services. And so the products of tomorrow will be with a lot of AI, a lot of digital technologies inside of products, also outside of the products. So products will be very different from today. And so you can easily imagine that the way you engineer, the way you manufacture, the way you support these products, will also be completely different. So I think next year, 2019, will be a lot about how digital is reinventing the products and services of the manufacturers. >> Right, we keep thinking about how it's reinventing our workforce and changing the way we're doing things, but it's actually going to be reinventing what's coming out, too, of these processes. >> Yeah I mean, you've touched upon some of the buzz words. I think it's also the maturity of the technologies. So I mean, I think that's certainly what excites me, is that the maturity and the capabilities has grown. So things like machine learning isn't necessarily new but with breakthroughs around the algorithms, that's kind of bringing the pragmatic reality of it being able to drive the innovation needed, you know? Capabilities such as the Cloud is providing that ability to scale up, scale down, the ability to provide processing power that wasn't there, previously possible in their price-performance way. So I think it's great to focus on some of the shiny things that are coming up, but I think it's also important to look at saying the things that are of yesterday isn't that far off, it's the maturity that they're reaching and so it's really making sure that they are taken advantage of and really taking that pragmatic approach of, it's got to be business-led versus technology-led, bringing that innovation into industry. >> Yasushi, do you see any big trends on the horizon that you're thinking about at NEC? >> I'm sorry? >> Big technology trends? Things that you're thinking about, maybe you're worried about, concerned about? >> Ah yes, I think IoT technology is helping reach to early maturity stage already. And at this rate, many users successfully gather, collect biased kind of data and revitalize the data to improve actual business operations. As a next step, I believe AI technologies will be widely applied for demand forecasting or that kind of failure prediction and that case of success in each industry will become solution models or templates, which will accelerate the progress of AI introduction. >> Great, well thank you so much. I really appreciate Yasushi, Eric, Paul, I really appreciate your time. It's been a great conversation. >> Thank you. >> We will have more from IFS WoCo 2018 just after this. (upbeat electronic music)