Infor's unique selling point in the ERP market has always been its commitment to industry verticals. Over the past decade or so, Infor has coupled this with an impressive turnaround plan, driving its customers to the cloud, implementing a user-focused approach to design, and making strategic investments in areas like supply chain.
The company is now owned by Koch Industries, a behemoth across US industries, and Infor has the benefit of not worrying about quarter-to-quarter growth (as well as a healthy balance sheet), instead focusing on long-term value.
We got a sense of what this means for Infor as we enter 2022 during the executive keynote at its annual conference (held virtually again this year), Inforum. Chief Executive Officer Kevin Samuelson, alongside his colleagues, outlined how Infor plans to take ‘industry specificity for ERP to a whole new level'.
The aim being, that if Infor can deliver quicker time to value for its customers, drilling down into out of the box functionality for specific micro verticals, then the company has a good chance of establishing a long term, high value, relationship with its customers.
In his opening address, Samuelson said:
This year, we're doubling down on everything we do at Infor to drive better business outcomes for you, our customers. It all comes down to our unique view of being industry specific and putting our customers first in 2021.
In 2021 seems like every technology company announced an industry focused strategy, but to really offer something that's differentiated by industry, you've got to solve your customers biggest challenges and unlock their greatest opportunities. And importantly, you need to do this much more quickly. And with less risk and less cost.
It starts with products that are built specifically for your business. This ensures that out of the box our products already fit most of your processes, include your key integrations and provide insights into your greatest opportunities.
Going deeper into industry verticals
Soma Somasundaram, Chief Technology Officer and President of Products at Infor, took time to explain why the industry-specific approach at Infor is valuable to customers. He explained that typically what ERP vendors do is announce an ‘industry edition' of a horizontal ERP, which he defines as a standardized ERP with some configuration for industry. This, Somasundaram added, is very different to an industry specific ERP. He said:
The problem with that is that you really cannot go and deliver the last mile functionality. So our approach is that we have a solution that addresses service industries, particularly healthcare and public sector. That is a different solution to what we go to market with for aerospace and defence and discrete manufacturing in general; which is different from process manufacturing, like food and beverage, chemicals and distribution.
In the last 12 months we have added some features, for example, in healthcare. We added bone and tissue tracking, right? That clearly is very healthcare specific. So, tracking a biological product right from when you receive it all the way through storage, how it's stored, what temperature under which it is stored, so that you don't compromise the quality of the product and have regulatory compliance and an audit that you can provide exactly how this product was handled. That is so specific to healthcare.
John Frank, President of Customer Experience at Infor, added that the end result for the customer in the horizontal, but highly configured, ERP scenario is that service and consulting teams are required to do a significant amount of heavy lifting. Something he said is "not tenable" and ultimately means bespoke execution for the customer, with huge support issues down the line.
So, what's next?
However, Infor wants to take its industry specific approach to ERP even further. Samuelson said that what Infor is going to be announcing soon is the "biggest innovation launched in the 20 years I've been at Infor". What this look like is taking Infor's products deeper into micro-verticals, with product specificity and best practices built in, out of the box.
Commenting further, Somasundaram said:
Time to value is something that everyone talks about, right? So, time to value, what is it? And how can Infor be better than the others in the market?
If process industries are addressed with one solution, I have only very few adjacent industries covered by one solution, so hence I can go deeper. But if I go one step further, I can actually create a configuration of the solution that is specific for a dairy processor versus a bakery.
And you can go one step further. Now you go and build a business process, procure to pay. In the US, in dairy, the farmers get paid at the end of the month based on the government established price. That is a very specific business process, right? That is quite different from the other industries we just talked about.
So instead of having to go to the customer and ask, how do you want me to configure and run procure to pay, I already know how dairy producers do that. So why can't we build business processes out of the box for that industry, for that micro-vertical. So that is the next step of innovation that should bring time to value.
Samuelson said that the alternative, for customers, is using a horizontal platform, sending in a lot of consultants, spending a lot of time making it work for a specific industry and a specific sub-vertical, as well as making it work for the role and with the data. He added:
Whereas we come out day one and say we've got your industry, your sub industry, your role and the data. That's the starting line and that's a huge difference.
A new marketplace for partners
With this in mind, has also this week announced Infor Marketplace, a "curated showcase of solutions that can augment and enhance customers' existing Infor investments". The marketplace is aiming to make it easier for customers to "discover, source and licence industry and micro-vertical solutions" that easily integrate with Infor.
The primary purpose of the marketplace, however, is to make it easier for Infor's partner ecosystem to build out those micro-vertical solutions in areas that Infor won't get to, and in turn make it easier for customers to purchase add-ones. Somasundaram said:
It's really important that we have partners coming with us on our innovation journey. We just talked about process industries, from food to dairy. But there are hundreds of micro verticals, even within those industries, that we can actually serve really well. It would be near impossible for Infor to innovate on all of that within the four walls of Infor. We need the ecosystem partners to participate.
So we're actually working on a marketplace that we'll be launching very shortly and that will allow for partners to work with us to actually go deeper into micro verticals that they have built a business around and bring their IP, not just for the region they're serving, but for a global audience.
Infor has done a good job of refactoring its business for a cloud customer base - the heavy lifting that has taken place over the past ten years has given the company a new lease of life. However, now that this structural work is maturing, Infor is going back to its roots and doubling down on what makes it stand out from the rest of the ERP market. I know vertical ERP, and micro-vertical ERP, doesn't sound particularly exciting, but it really is a differentiator for the company.
Other ERP vendors are just catching up on this front, and as Infor notes, often it's just a bit of a configuration, or a reliance on partners to fill the gaps. But as I've noted previously, Infor has the benefit of being privately owned. Delivering value quickly for customers isn't always lucrative in the short term, but does create potential for a long-term relationship. Other software vendors are often thinking about the next quarter. However, as ever, the proof will be in the pudding - customer use cases. We look forward to seeing how this plays out down the line for them.