Many of ERP vendor Infor's customers are in conservative industries such as manufacturing, healthcare and public sector. They're not eager to upgrade to the latest version of its software so long as their systems are working just fine on the installed version.
If Infor wants to grow its revenues, it has to ensure there are compelling reasons for those customers to take that step.
"We can't force anyone to move but we have to make it really attractive for people to move," explained Infor's CEO Charles Phillips, speaking to diginomica by phone today. In the conversation, we discussed a number of initiatives at Infor that aim to encourage customers to make that move.
Infor 10x, the latest release of the vendor's core platform, was launched in April this year with a wealth of features the company hoped would prove compelling: a consumer-inspired HTML5 user experience, a social collaboration platform called Ming.le, built-in analytics and a flexible integration framework. This month, Infor has announced a cloud-hosted ecommerce platform called Rhythm and a new analytics platform, d/EPM.
"We've got thousands of customers that have upgraded," said Phillips today. "I can't give you the exact numbers but it is thousands. We have a lot of momentum to 10x."
But a few more wouldn't go amiss. So this month Infor has introduced UpgradeX, which allows customers to upgrade to the new release by moving to a cloud version, hosted by Infor at Amazon Web Services.
"I think UpgradeX will accelerate it," said Phillips. "This is a new segment of the base we can address.
"I've also been surprised by the type of industry that were responding, even those that two years ago were telling me no way I'm going to move my system to the cloud" — sectors such as aerospace and defense.
The notion of offering a cloud option had come out of conversations with customers that revealed they were feeling overwhelmed by the breadth of change in 10x, revealed Phillips: "They were saying, 'It's almost too much. We're not used to going at that pace. It's hard to upgrade'."
So the main aim was not to take over operating the software so much as simply finding a way to ease the upgrade pain so that customers could get to the new features that are only available in the 10x release.
"It wasn't so much saying that, 'We want someone to run my system'. It was, 'I don't want to do upgrades and patches ... Rather than me trying to keep up with you guys, why don't you take responsibility for upgrading my systems?'
"It's not that they don't want the new technology, it's the challenges of upgrading. One of the major reasons people upgrade is to separate the ERP engine from the integrations and the reports ... All these programs are about lowering the customization risk, the integration risk, the operational risk."
Infor will also support customers who opt to remain on-premise, said Phillips. "The goal is to make either choice look very similar from a technology perspective." But cloud is the preferred platform:
"It's actually easier for me if I have a consistent set of systems and infrastructure rather than trying to do everyone as a bespoke system ... if you want me to do it, you might as well let me put it in the cloud."
The decision to host the Infor cloud offering on Amazon will come as a surprise to some, but Phillips is confident this is the best option.
"I've made a long term bet their prices will continue to fall faster than mine would. In terms of focus and where the value-add is, I don't think it's in the infrastructure.
"Every SaaS company thinks they have to go build a datacenter. There's no reason to do that, there's so much nearly-free infrastructure."
As for security, Phillips argues that hosting in the cloud is safer than staying on-premise:
"I would argue that people's data is more secure in Amazon than in most of their IT stock. Ninety percent of security breaches are internal breaches."
Fresh from a two-week tour of Europe, Phillips concedes that the customer base here is a lot more conservative. "Europe is definitely 4-5 years behind the US," he said, while adding that recent signs are more hopeful. "The gap is closing in the past 12 months more than I've seen in a few years."
Infor's new user-friendly interface, SoHo, is another important factor in upgrade decisions. said Phillips.
"A good chunk of them, that's the reason they want to upgrade. In a lot of cases, what they want is that UI."
Adapting applications to the SoHo UI is the task of Infor's internal design team, branded Hook & Loop, whose director Marc Scibell was recently promoted to the new role of Chief Creative Officer. Phillips described the group's iterative approach to application development as one that aims to do a much better job of matching app design to real-world business processes.
"We send teams of people out to a customer site and look at what they're doing and what is the problem they're trying to solve ... You can't be thinking in terms of two-year time cycles, you've got to be able to come back in 48 hours and say, what do you guys think of this?"
Also announced this month is Infor Rhythm, a cloud-hosted ecommerce platform that in future versions will be adapted for other sectors such as hospitals and municipalities and hotels. "Think of Rhythm as an engagement platform," said Phillips.
Thanks to the mobile-friendly UI, Rhythm will help companies that currently interact with customers using fax or phone leapfrog to online interaction via mobile platforms. One example Phillips cited is an electrical distributor.
"Most of their customers are at construction sites. They just have their phone. They can't very easily go to the website on their mobile device, so they just use the phone to place orders. They want to do everything right on the phone. The design point is mobile."
A major US city will have an early release of the civics version of Rhythm as a basis for a citizens portal, said Phillips. "Everyone wants to have self-service for their constituents." It will allow citizens to access a variety of data and processes from a single self-service portal instead of having to deal with departmental sites or offline services.
The same city is also using the Ming.le social messaging platform for internal collaboration across siloed processes, he said. For example, it allows officials to track what's happened on a case once it's been handed off to a specific department.
"If someone calls the mayor's office about something that happens in their neighbourhood, the mayor's office can't track it. With a Ming.le platform, they can watch the newsfeed and everyone knows what's going on."
Big data is also going to the cloud at Infor. The Amazon-hosted SkyVault analytics platform announced at Inforum in April will be ready by year end, Phillips said. "Amazon had to make a few changes for us in the database and the analytical tools." There was also some work needed to streamline the way that the platform fetched in data, he said.
Product managers are currently working with customers to define the KPIs needed in specific industries that will feed into the product's dashboards. The recently launched Dynamic Enterprise Performance Management (d/EPM) product will also have a Sky Vault version, Phillips confirmed.
Picture credit: @jonerp