IFS Cloud bolsters ESG reporting, reverse supply chains

ESG reporting in ERP a no-brainer

IFS' approach to ESG reporting and the ESG Lobby are important additions for customers looking to meet upcoming regulatory standards such as CSRD, said Isaac Gould, research manager at Nucleus Research.

He echoed Keam's point that data relevant to ESG reporting, such as invoices, purchase orders and supplier relations, is already in ERP systems. It makes sense to do the tracking and reporting through a centralized dashboard such as the ESG Lobby, he said.

IFS has a sizable customer base in Europe, so it's also important to provide tools that help customers comply with CSRD and other upcoming regulations, Gould said. U.S.-based companies will also need these capabilities, as many operate in the EU and face increasing regulatory standards in the U.S.

"It makes sense to do this with your ERP system rather than having to outsource it and then build integrations, which would be very costly and time-consuming for their customers," he said.

However, the ESG Lobby is in trial phase, so its value is still unproven, Gould said. Reporting might still be challenging because ESG data also comes from outside IFS Cloud -- for example, supply chain and logistics data is often captured in other applications, but necessary for reporting purposes.

"You're not one-and-done once you get IFS ESG Lobby," he said. "You're still probably going to need to pull in data from other parts to get a full ESG picture of your entire organization."

Other updates strengthen areas that already make IFS a leading ERP choice for industry verticals such as manufacturing, Gould said. New circular operations functionality will be useful for manufacturers that want to extend their operations by helping them calculate the cost to disassemble returning products, pinpoint materials that can be reused, and track the volumes and amounts of materials that can be reused.

"It's reverse logistics, but specifically for the manufacturing component of that picture -- and from a financial planning and operational aspect, you need to be able to capture and calculate that data," he said. "Now you can enable your circular operations within IFS, rather than doing it in a spreadsheet or reporting it out to a separate system."

The capabilities are important now with ESG and sustainability becoming more of a priority. Companies want to maximize their assets and materials usage and provide a new life for their products if they can resell them after a return or maintenance, Gould said.

Predrag Jakovljevic, an analyst at Technology Evaluation Centers, also sees promise in the update. He said some of the new features, including ESG Lobby and the circular operations and field service functions, should be attractive to customers.

Some of the updates give IFS Cloud a good position in the field of manufacturing tools, Jakovljevic said. Although he also noted that this update did not appear to include industrial integrations with Falkonry AI and connected worker capabilities from Poka, two companies that IFS acquired earlier this year.

Jim O'Donnell is a senior news writer who covers ERP and other enterprise applications for TechTarget Editorial.