Interview - the ex Google and SAP exec now leading Unit4's reinvention of ERP

What attracts a successful VP of Products at Google and former head of HCM products at SAP SuccessFactors to come and lead product for a 40-year-old ERP software company based in the Netherlands? For Dmitri Krakovsy, who was confirmed as Chief Product Officer at Unit4 last week, it's the belief that enterprise software is at one of those once-in-a-generation shifts to a new architecture — and that Unit4's upcoming ERPx platform is in the vanguard of this shift. As he explains:

It was always kind of gnawing at me that the next cycle is starting now ... Machine learning, microservices, the world of APIs, [were] broadly evolving the sort of composable components, where things just kind of appear/disappear on the fly. In terms of UI, digital assistants, voice, natural language, blah, blah, blah ...

All of these things were not a part of the toolset when SuccessFactors or Salesforce or Workday, whatever, started. It's just not how things were put together at the time. And so the broad thought of, 'If I were to do an ERP now, I would do it very differently from how we did it before,' was always a little bit in my head.

I come here, and initially, the idea was just help them launch and organize this thing. And I was like, 'Whoa, all these things I've been thinking about are in flight here to a large degree, and many of them are done, and in a very similar way to how I would have done them, if I were doing them from scratch.

Composable architecture

The new ERPx, which becomes available next month, conforms to what at diginomica we've called a tierless architecture, comprising a serverless, API-centric platform which can be accessed either through a traditional UI or 'headlessly' via a digital assistant, messaging apps such as Slack and Teams, or other vehicles. Another crucial element is the ease of connection to other components and platforms. Krakovsky explains:

The world is evolving from big monoliths that contain everything ... A realistic world is you consume Stripe, and you consume SendGrid, and you consume Twilio, and then you create your own things, and you compose the app that you want to compose from that. It's not one thing. It's multiple things put together in a compelling, for a customer, way.

That's where the rest of the world has evolved to, and, I think, where systems like this need to evolve to as well.

Creating this composable architecture was therefore a key consideration. He elaborates:

That was a core fundamental principle for us. Break it into pieces, have pieces interact with each other individually, not really differentiate between things we built and third-party things. So we can ingest something with an API from a third party just in exactly the same way we ingest something with an API from our own system. Then you compose the system that's right for the customer, based on this set of assumptions. That's what makes it flexible.

Adapting to change

While the UI, in particular the smart assistant, has been part of Unit4's roadmap for several years now and is already widely in use, the composable architecture is the major new advance in ERPx. There are ten customers already signed ahead of the March release, but what of the rest of the installed base, many of whom are still running older, on-premise versions of Unit4's business software? Krakovsky says that many of the core business functions will be familiar, with the main change being in the technology architecture, which runs in Microsoft's Azure public cloud. He says:

I think the value is in creating sort of this broader end-to-end system as opposed to individual blocks in finance areas or whatnot. To me, that's the attraction. You could say it's legacy, but the alternative perspective on this is, it's stuff that works, and you don't necessarily need to change. You change things more around it than some of the core, for instance, finance pieces.

Unit4 continues to focus on a specific set of people-centric industries and a mobile-first user experience, he adds. The big advantage of the new ERPx platform is its adaptability in a changing world, as he explains:

The platform first enables the industries and experiences, but also enables the adaptability, change, and resilience over time. As customers talk to us about what their needs are ... it's very clear to them that they change — particularly now during the pandemic, so much has changed. So the message of change resonates. And the message of system that enables this change, also resonates. So that's really how we would position this. We say, we build a system that's right for you, day one, and it will stay right for you over time.

My take

The advent of ERPx is a further instance of the gathering trend towards tierless architectures, which to date has been more in evidence among digital experience (DX) and customer experience (CX) vendors than in more traditional enterprise application fields. Can a long-established ERP vendor successfully join a trend that's so far been the preserve of younger companies?

Krakovsky's argument is that the ERPx architecture is just as youthful, and that it creates a powerful combination when wrapped around Unit4's longstanding experience in delivering business functionality to its target industries. That may be true, but Unit4 is being very ambitious here, not only promising to mesh with a vast range of third-party components but also layering a low-code environment that makes it easy to configure bespoke business processes and data analysis virtually on demand. That's something few of the DX and CX players have yet achieved.

Then there's the question of how its existing customers will receive these new capabilities. They will be aware that this is not the first reinvention of Unit4's ERP stack since it began its migration to the Azure cloud. And while today's business environment demands adaptability to change, how many IT departments are equipped to manage the kind of composable systems that Krakovsky describes? We didn't get the opportunity in our conversation to talk about the role of partners, which Unit4 is currently recruiting, but their role will be indispensable to a successful transition for many customers.

Yet despite these nagging questions, I do find myself intrigued by what Unit4 has set out to do with ERPx. Every ERP vendor is currently attempting to chart a path towards a more adaptable, agile future for its customers. Is Unit4 the first to have figured out how to get there? We'll get a clearer answer after its release next month.