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How product innovation can drive differentiation on the best cloud platform

Joyce Boland
Vice President, Applications Global Marketing

Isn’t it interesting that some of the products and services we covet the most – that have become integral parts of our daily lives – we didn’t even know we wanted or needed?  Products like the iPod (yes, I‘m dating myself), the iPad, and services like Uber, and Netflix’s original DVD rental by mail service and eventual streaming service just seem to come along, make complete sense, and turn entire industries upside down.  Whether an idea is brilliantly simple or brilliantly innovative, many of us are either scratching our heads asking, “Why didn’t I think of that?” or we’re in awe of the forward-thinking mind that came up with the new idea.  And once these innovative products and services become mainstream, it’s equally amazing to watch the follow-on products, services, and companies that hit the market to capitalize on the very things we didn’t even know we needed.    Of course, the examples I’ve mentioned pertain to popular culture and lifestyle.  However, this discussion is equally as relevant to innovative industrial products that are specific to certain industries that create breakthroughs in science, technology, transportation, safety, and the environment.

A recent study titled IT Solutions in Manufacturing: Differentiating with the Interactive Design & Automation Execution Loop (ID&AL) by CXP, a leading independent European analyst firm, revealed that the #1 challenge for manufacturing companies is innovation.  Not surprisingly, cost reduction and customer service were the second and third challenges, at 45% and 44% respectively.  However, cost savings and service are far behind the 68% of survey respondents who noted innovation as the top priority.  And, once your company’s creative juices are flowing, you need a comprehensive technology platform in place to scope, design, prototype, and create new products—to capitalize on your great ideas.  

Use technology to support innovation

According to CXP, enterprises should follow their Interactive Design & Automation Execution Loop (ID&AL) model that identifies technology as the critical element to transform traditional industrial manufacturing to facilitate innovation. However, key to their model is an IT platform that evolves and keeps pace with new features and functionality.  That means, on-premises solutions, that are obsolete by the time they’re implemented, just won’t cut it. 

Get to know Interactive Design & Automation Execution Loop model

If you’ve never heard of CXP’s ID&AL model, I’ll explain it at a high level.  It’s a comprehensive approach to align innovative endeavors with IT systems, regardless of how your new product development takes shape—from R&D, POCs, experiments, or exploratory efforts.  According to CXP, “ID&AL seeks to ensure that an IT system is constantly adapted and responsive in a changing world.  It is based on the idea that the business applications that make up the IT system are constantly aligned towards achieving the same goal:  to offer and provide an appropriate response through a differentiating and scalable customer experience.”

Figure 1 shows the ID&AL model.  You’ll notice it’s a closed loop with integrated business planning (IBP) and data analytics flowing across every element of the design and execution processes.  This holistic approach ensures that data, metrics, and detailed analytics are always readily available to key stakeholders and lines of business instead of in silos that make it difficult to access, compile, and gain insights.

Figure 1 - Integration Design & Automation Execution Loop Model

Source: CXP - teknowlogy Group (2021)

Another key point is that the ID&AL model goes beyond closed loop manufacturing and MRP2 (manufacturing resources planning) because it includes the ideation, design processes, Product Lifecycle Management system (PLM) as well as the sales and customer service functions for new product introductions.  CXP says, “This broader closed loop helps the system get automatically enriched over the course of the experience feedback, thereby optimizing product and service design to increase overall performance.”

Choose a cloud-based technology solution

I mentioned above that on-premises solutions won’t cut it with the ID&AL model.  That’s because it’s critical for the IT solution to adapt and change to keep pace as the with changing market dynamics.  That’s exactly what you get with many cloud solutions.  The cloud provider releases their own stream of innovation with regular updates that have new capabilities and the latest technology.  With cloud solutions, you automatically get these updates; you are not on the 3-5-year upgrade cycles you have with on-premises solutions.  Therefore, the concept in the ID&AL model of using an IT solution that adapts and changes automatically won’t work with an on-premises application.

There are many other benefits to cloud solutions as well.  You can also implement cloud applications much more quickly than on-premises applications, so you can achieve value rapidly.  You have a predictable monthly fee instead of an expensive up-front outlay.  You can streamline your IT management efforts since the cloud provider manages the application infrastructure.  This eliminates the work of maintaining data centers and updating systems, and you’re sure to always be on the latest release. 

Drive continuous innovation with Oracle

CXP surveyed the landscape of software vendors that provide continuous innovation application suites.  The consulting firm analyzed the different vendors based on range of functionality and level of integration of the applications that make up the continuous innovation platform.  As noted in the Figure 2 vendor grid below:

“Oracle is the only large vendor proposing a coherent ID&AL suite, due to the fact that all bricks composing the suite are based on a single data model and technology foundation.  Oracle owning both the applications and a leading technology stack, which it can optimize without any external delay.  This specificity is particularly important as Oracle is rewriting its entire applications suite for the cloud and improving its functional capabilities. (This standard and new technology and products earns Oracle 5 stars.)”

Figure 2 - ID&AL positioning vendors

Source: CXP - teknowlogy Group (2021)

The report explains that other vendors may say they have a cohesive suite of continuous innovation applications.  However, these vendors either don’t offer the full scope of applications to facilitate both product design and manufacturing, or their applications aren’t as tightly integrated as they should be to achieve your continuous innovation goals.  

For example, CXP found that although SAP provides a broad range of applications, “what can be seen as a renunciation to offer a proper PLM solution of its own, disqualifies its current solution from an ID&AL approach.”  Similarly, while IFS offers a broad range of functionality, it doesn’t provide applications to support all elements of the ID&AL model.  And interestingly, although Microsoft is considered a viable vendor in the continuous innovation software landscape, the company doesn’t offer its own cohesive application suite.  Instead, companies must cobble together an application suite from a roster of Microsoft partners, and as CXP concluded “you have to be a knowledgeable connoisseur to identify the right bricks [vendors], and the end solution will only be as good as the local partner.”

You can find a complimentary copy of the report here. To learn how to Unlock Continuous Innovation with Oracle visit us here.

IT Solutions in Manufacturing: Differentiating with the Interactive Design & Automation Execution Loop (ID&AL)

CXP- teknowlogy Group, 2021

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