Cloud-based asset management software is in demand

Major industrial software providers are fully invested in cloud-based platforms, and their customers are embracing the strategy. Deploying solutions such as enterprise asset management (EAM), asset performance management (APM), and enterprise resource planning (ERP) in the cloud comes with many technical, functional, and business benefits.

On-premises installations, hosted and managed internally by IT departments, have long been losing favor to software-as-a-service (SaaS) and cloud-based alternatives. Stated reasons range from security, economy, and ease of use, to facilitating smart manufacturing and industrial internet of things (IIoT) technologies such as sensors for remote condition monitoring and predictive maintenance (PdM); advanced analytics with artificial intelligence and machine learning (AI/ML); and augmented and virtual reality (AR/VR).

Due in part to the availability and capabilities of cloud-based solutions, the global EAM market size is expected to grow to USD 5.5 billion by 2026, according to the February 26, 2021 Enterprise Asset Management Market report by Akash Khandebharad, Senior Research Analyst of Information & Communications Technology at MarketsandMarkets Research Pvt Ltd.

For instance, Covid-19 prompted many enterprises across verticals to adopt “the work-from-home model to safeguard employee well-being and maintain operational efficiency, surging the demand for cloud-based solutions.” Khandebharad also found that while the on-premises version of EAM is mainly preferred by organizations that need control over the security of information about customers and companies, the affordability and ease of deployment of cloud services would act as major factors for the adoption of cloud technologies among enterprises.

This article explores reasons for the shift to the cloud and how the technology is making a difference in practice.

What is motivating the transition?

Dan Miklovic, Founder of Lean Manufacturing Research, LLC and Member of The Analyst Syndicate, shares seven reasons he believes companies are (or should be) moving their EAM/APM processes to cloud-based technology:

1. Security: As recent cybersecurity attacks are showing that industrial companies are increasingly under threat, having the additional layer of security that a top-tier cloud provider (AWS, Azure, Google, etc.) strives to keep up to date is preferable to going it alone. Also, the cost of constant vigilance is spread among all.
2. SaaS and the pace of change: Between IIoT, AI/ML, AR/VR, and other technological advancements, the rate of innovation is increasing so rapidly that trying to keep systems up to date means constant upgrading. Since SaaS, subscription-based EAM, and APM solutions are mostly cloud-based and multi-tenant, the supplier can, if using a microservices architecture, introduce new capabilities on a continuous rollout basis so users are always on the most powerful and capable release.
3. Implementation and support: The pandemic taught us that solutions hosted in the cloud, be they dedicated or SaaS, are far more supportable than on-premises alternatives, which helps to improve metrics such as time to install and service call time.
4. Standardization: When using a single instance, corporations are in a far better position to ensure that both data and work-process standards are enforced across the entire enterprise. This can result in lowered procurement costs, better uptime, enhanced safety, and a host of other benefits.
5. Globalization: For multinational firms, the global infrastructure offered by major cloud providers means better 24x7, follow-the-sun support. Depending on the application provider, language support, regulatory compliance, and other factors are often delivered sooner when using their cloud/SaaS offerings than with their on-premises releases.
6. Training: All the major cloud providers have abundant training on their platforms and general-purpose tools such as IIoT connectivity, AI, and AR/VR capabilities. Smart EAM/APM providers leverage the standard capabilities of the platforms and the training the platform providers offer. Additionally, when using the cloud/SaaS versions of the product, training investments gain from standardization, access to expertise, and the use of new technology.
7. Scalability: For many smaller enterprises, the built-in capabilities of cloud platforms such as AWS’ IoT/AI-based predictive maintenance (PdM) tools mean companies can have access to capabilities previously only available to larger enterprises running more expensive solutions. Also, larger enterprises can rapidly scale up or down their system usage as economic conditions warrant when operating in the cloud.

“Of course, all of these translate into the best reason: total cost of ownership (TCO),” adds Miklovic. “While the data is still evolving, the final result is almost certainly going to be that the total cost of operating your EAM/APM system is going to be lower, when all things are considered, if you are in the cloud.”

Additionally, the value returned will be higher. “With today’s far greater connectivity and higher-reliability communications and architectures, the old arguments for on-site solutions just don’t wash except in the rarest of remote sites,” Miklovic explains. “And even then, with Internet solutions like Starlink offering connectivity from most anywhere, those arguments are falling by the wayside.”

Asset management and beyond

Solutions deployed in the cloud, such as on Azure, are growing in number and scope. Vendors including IFS are consolidating their products on a single technology platform with a common user experience and data model, and containerizing it to accelerate deployment. “Gone are the days of a product release happening every 18 months to two years with interim patches,” says Colin Elkins, Vice President of Manufacturing Industries at IFS. “This is now a moving feast, and maybe almost the last major product release we will ever have, because from now on it will be an iterative change.”

Cimcorp Group, a leading manufacturer of robotics and automation systems, is an early adopter of the IFS Cloud platform. “We are constantly looking for technologies and processes that will allow us to work smarter and faster than our competitors,” explains Jyrki Anttonen, Technology Director at Cimcorp.

“Analytics is one of the focus areas for us at the moment,” adds Anttonen. “So far, we have concentrated on edge or on-premises analytics and IFS Cloud will enable us to have another level on top of that with cloud-based analytics. With this, we could link the data and analytics from different customers and different sites to the assets already existing in our ERP. We will have centralized, easy access to all data and analytics, enabling us both better tools for ourselves, and opportunities for better services to our customers.”

It is all about the circular economy and how service, maintenance, asset management, and manufacturing are all starting to come together, observes Elkins. “We believe that if you truly want to address the circular economy, you really have to have everything almost in one place purely to be able to track materials in the field and be able to bring them back via reverse logistics, repair, remanufacture, and put them back into the field.”

Furthermore, data modernization strengthens efforts to predict and improve asset health and the enterprise’s overall performance. “As people build more and more sensors in their devices or into the products they sell, I think we're going to see a whole plethora of data, and the cloud is probably the single best way of deploying that data,” suggests Elkins.

Considering the agility, efficiency, and many competitive advantages fostered by cloud-based asset management software and related solutions, it is no wonder that demand is on the rise.