OM Digital Solutions

Replacing a 20-Year-Old Legacy ERP to Support Business Diversification

Established in 2020 following the transfer of Olympus Corporation’s imaging business, OM Digital Solutions Corporation develops, manufactures, and sells digital cameras, interchangeable lenses, IC recorders, and other precision products. In 2025, the company adopted a business-unit structure and now operates through three divisions: OM SYSTEM, focused on consumer precision products; OM Innotech, providing imaging and audio solutions for business customers; and OM Optical Precision, offering electronics manufacturing services (EMS) based on advanced optical production technologies.

The ERP system operating at the company’s manufacturing facility in Vietnam was inherited from the Olympus era. According to Tomoki Oe, then Vice President of Corporate IT:

“After the establishment of the new company, we rebuilt our core business systems in Japan and other Southeast Asian locations. However, the Vietnam factory continued to operate using a system that had been carved out from Olympus’ ERP environment. Over more than 20 years of modifications and enhancements, customization had become extensive, and the effort required for each system upgrade continued to increase.”

Hideaki Matsuoto, Executive Officer and Plant Manager of the Vietnam factory, explained that the legacy ERP had originally been designed primarily to support financial reporting requirements and was not necessarily user-friendly for manufacturing operations. In addition, supporting the company’s increasingly diversified business model had become a growing challenge.

“Following our transition to a business-unit structure, our traditional business of manufacturing consumer products for internal sales organizations was expanded to include B2B businesses such as electronics manufacturing services. The existing system, which was designed primarily for internal manufacturing operations, had reached its limits. We needed a platform that would allow us to separate and manage operations by business unit.”

OM Digital Solutions Selected IFS Cloud for Its Comprehensive Manufacturing Capabilities

To address these challenges, the company initiated a project to modernize the ERP system at its Vietnam manufacturing facility. After evaluating several enterprise applications with strong manufacturing capabilities from a global perspective, OM Digital Solutions selected IFS Cloud. The decision was driven by the solution’s high degree of fit with the company’s business requirements, as well as the comprehensive support provided by IFS.

“We evaluated IFS Cloud as a highly mature and reliable solution with extensive functionality specifically designed for manufacturing organizations. Its proven track record among European medical device manufacturers further strengthened our confidence in the platform,” said Oe.

Another important factor in the selection process was the strength of the implementation ecosystem. The company placed significant value on the collaboration between Alphast Corporation, an experienced IFS implementation partner, and the local partner team in Vietnam.

“While the capabilities of IFS Cloud were certainly important, the expertise and capabilities of the partners responsible for delivering the solution were equally critical to the success of the project,” said Matsuoto.

Reengineering Processes Around Standard Functionality and Minimizing Customization

IFS Cloud implementation project kicked off in July 2024 and went live in October 2025. The scope covered procurement, manufacturing, inventory, shipping, and financial management, with the solution deployed through a big-bang approach.

Throughout the project, OM Digital Solutions adopted a Fit-to-Standard philosophy, redesigning business processes around standard functionality while minimizing custom development and modifications. The goal was to establish a sustainable operating model that would support future business growth.

“With the Fit-to-Standard approach, we communicated to our operational managers that some additional effort and temporary reductions in efficiency would be expected during the transition period. We encouraged users to embrace the standard functionality and gradually adapt their processes. As a result, we were also able to identify underlying operational challenges and create a shared understanding of issues that had previously gone unnoticed,” said Matsuoto.

The project focused on five key improvement areas: enhancing responsiveness to demand fluctuations, strengthening inventory management, improving manufacturing process control, supporting business diversification, and increasing profitability management capabilities.

According to Kenichi Kaneshiro, Division Director, one of the most significant challenges involved adapting to differences in business processes and system concepts between the legacy ERP and IFS Cloud, particularly in areas such as backflushing and automated material consumption.

“We needed to help users understand that long-established ways of working would not necessarily translate directly into the new system. At the same time, some processes that appeared to function well in the legacy environment were actually generating small errors and hidden inefficiencies. By moving to IFS Cloud, we gained visibility into issues and inefficiencies that had previously been difficult to identify, which we consider one of the major achievements of the project.”

Another key initiative was the creation of a dedicated MRP simulation environment.

“In our previous system, MRP simulations could only be performed within the production environment. As a result, planners had to prepare data in Excel, create plans manually, run MRP overnight, and then review the results the following morning. If the outcome was unsatisfactory, the entire process had to be repeated. With IFS Cloud, we established a separate MRP simulation environment, enabling us to validate planning scenarios before applying them to production. This has significantly improved the accuracy and quality of our supply and demand planning.” - Keiichiro Imamura, IT Manager.

To support the company’s increasingly diversified business structure, OM Digital Solutions also separated operational sites within the system to enable business-unit-level access control and strengthen information governance. This approach has clarified financial accountability and operational responsibilities for each business line while providing the flexibility needed to support future business expansion.

Improving Operational Transparency and Accelerating Visibility

Approximately six months after go-live, one of the most significant benefits realized by OM Digital Solutions has been improved operational transparency.

“The speed at which issues arising on the shop floor are communicated to management has improved dramatically. In addition, the simulation capabilities of IFS Cloud have enabled us to make more forward-looking decisions,” said Matsuoto.

From a financial management perspective, enhanced reporting capabilities have reduced the time required for report generation and analysis, enabling faster decision-making. The company’s internal IT team can now also develop reports tailored to specific business user requirements.

“Accounts receivable aging information, which previously took considerable time to generate in the legacy system, can now be accessed at any time using IFS Cloud’s Quick Reports and Lobby functionality. By reducing report lead times, we can analyze and interpret financial data from multiple perspectives more effectively,” said Kaneshiro.

From an operational standpoint, the combination of increased internal ownership and the Fit-to-Standard approach has delivered substantial cost savings.

“At present, we have reduced annual system operation and maintenance costs by approximately 70–80 percent. This achievement has been driven not only by the new system itself, but also by a significant shift in mindset across the organization,” said Oe.

Exploring AI-Driven Automation and Advanced Analytics

Building on the success of its Vietnam ERP transformation, OM Digital Solutions is also evaluating the modernization of legacy ERP systems at its European operations, leveraging the capabilities demonstrated by IFS Cloud. At the same time, the company is exploring AI-driven automation, operational efficiency improvements, and more advanced data analytics as the next stage of its digital transformation journey.

“The manufacturing industry has long discussed the concept of expert systems—solutions designed to capture and replicate the tacit knowledge of skilled workers. We believe AI has the potential to deliver on that vision. Going forward, we would like to actively leverage AI in factory operations, including predictive maintenance alerts and other intelligent capabilities,” said Matsuoto.

“Our ideal state is to be able to monitor and report the value of work-in-progress inventory and overall inventory status in real time. By leveraging AI-driven learning and forecasting capabilities, we believe it may become possible to generate balance sheets on a daily basis. This would allow us to understand the state of the business much more quickly and support faster, globally competitive management decisions,” said Kaneshiro.

Oe emphasized the importance of continuing the partnership with IFS as the company advances its transformation initiatives.

“We expect our relationship with IFS to continue for many years to come. We look forward to receiving new ideas and recommendations that will help guide us to the next stage of growth. We also hope to see IFS’s strong momentum reflected in new services and product innovations that will support our future success.”