Darren Roos officially took the reins as CEO of global enterprise software company IFS on April 1, succeeding the now-retired Alastair Sorbie. In naming Roos, most recently the president of SAP's cloud ERP business, as the company's new chief, IFS touted his "track record for establishing and scaling global software businesses" and his "reputation as a customer advocate, industry thought leader and cloud expert."
Roos sat down with Plant Services chief editor Thomas Wilk and managing editor Christine LaFave Grace in March for an interview at IFS North America offices in Itasca, IL. Here, Roos' take on leading challenges for manufacturers today, trends in the move toward manufacturing's digital future, and imperatives for industry executives.
…on the demands that the ever-quickening pace of technological change is placing on industry:
Roos: I think the market is going through an interesting transition. Irrespective of the industry that they're in, (organizations will) all be able to do things more efficiently. They'll all be under pressure to look at fundamentally different ways to do it, whether they're an oil and gas company or they're an industrial manufacturing company. Whether they're aviation or defense, they'll be trying to figure out how (to) do things differently, because the level of disruption that all of them are facing today is at a level unlike anything that any of our customers have ever seen before.
I think there was a time not that long ago when businesses could, if you had a competitive differentiator and you were doing well, there was an opportunity to rest a little and go, "OK, we're on top of this." You would go, "OK, maybe in the next board meeting we need to commit a session to thinking about where it's going next," but it's different now. In the market today, your customers have to constantly be thinking about, where is the unconventional threat going to come from? In other words, will my market exist at all a few years from now? Is a nontraditional competitor going to enter my market? You know, it's the Uber example. It's not, "Is there going to be a new taxi company?" It's, "Is somebody going to come in and replace taxi companies?"
(Businesses) are under a completely different level of threat than they've ever been before. And that necessitates them, at every juncture, stopping and going: "How are we going to do things differently? How do we position ourselves from a technology perspective, from a digitization perspective, to be able to respond to threats in a more dynamic way?" Whether that is coming up with new business models, whether that's getting closer to their customers, whether it's running more efficiently. Can we drive greater profitability through running more efficiently, so that we can then pass on some of our saving to our customers, which enables us to build better relationships with them and keep them for longer?
These are macro trends that are just a reality of what our customers are facing, and it's leading to this constant review of technology and the way in which technology can support that process. And I think that's very exciting
.…on the trends moving manufacturing to a more-digitized future
Roos: Clearly, the move to the cloud is a big trend now, for obvious reasons. Customers get to focus on their business rather than on managing infrastructure and "how much capacity do I need?" What the cloud gives them is the ability to be able to consume new capability through a regular upgrade or update process rather than doing a big upgrade every few years.
The next (big trend) is the move toward connected devices and IoT and trying to connect everything so they can aggregate all this data and get loads of clever intel. The predictive maintenance use cases are tremendous. You think about oil rigs as an example, and the ability to put sensors into specific parts that are then able to measure vibrations and tell you when a pipe needs replacing, and they're replacing pipes when they need to be replaced rather than after they're broken. Which means that you can schedule the downtime, schedule maintenance crews, and you don't have a situation where something breaks and it's, like, now we need to try and get a part and somebody to come and fix it and the part's in, you know, outer Mongolia.
And then the third one and probably the one that will have the biggest impact is this move towards artificial intelligence automation. I think it's having a tremendous impact on our industry. What we as software vendors are doing is we're working with customers in order to identify what the use cases are. If you had this conversation five years ago, nobody was doing this stuff. There will be, in time to come, significant improvements in the way that we do things, leveraging artificial intelligence and machine learning
.…on where manufacturers' interest in AI applications stands
Roos: I think there's a lot of curiosity from customers now about how they can do it, and it comes back to, they're all under pressure to be more efficient. If you have a specific manufacturing entity and they can automate 20% of what they're doing and they're competing against somebody who's automated nothing, that company that's automated nothing is probably not going to be around for very long.
And, you know, either their shareholders are going to go: "Look, we don't have confidence in the leadership team. We're going to replace the leadership team because we look at our peers and our profitability is out of whack." Or they'll be acquired. It's that simple.
You're either thinking about this and are doing something about it or you're the guy who didn't realize it's coming.