In with the new as Unit4 refreshes its executive team

Business software vendor Unit4 today announces a management shake-up following its acquisition by private equity investor Advent International in a $1.6 billion deal that closed in March this year.

CEO José Duarte has wielded a new broom that sweeps away the old management board structured around geographic lines and populated by decades-long company insiders. In come five new appointees from European enterprise software and services backgrounds including SAP, ATOS, Software AG and Siemens.

Duarte told diginomica yesterday that the changes had been in the works for some time:

Even before the investment was made, the realignment of the top management was planned. Since we completed the transaction in mid-March we have accelerated on this. We have now pretty much the whole of the team lined up. Now it's execution time.

Four of the new team have been named today, filling roles heading up global strategy and operations, marketing, sales and services respectively. They will join Duarte on the management board along with Jeremy Roche, CEO of FinancialForce.com, and the company's CFO and head of HR. A CTO has also been recruited and will be named in September, said Duarte:

The organization structure changes from geographically driven to a value driven or client lifecycle chain. I'm a big believer that customer centricity is key for success in any organization. You've got to drive accountability around the customer lifecycle. That's basically what we're doing.

One of the cornerstones that would bank a lot on driving an innovation story, is the CTO to craft the next steps of the solution portfolio.

It's a guy that has a relevant experience to the type of transformation we want to be bringing to our business.

Cloud and mobile first

Investments in cloud and mobile capabilities are a big part of the company's growth strategy and Duarte promised more changes to its flagship Agresso ERP and Coda financials products, building on the Agresso update announced in January:

In the next release you're going to see cloud enabled, mobile first in a bigger way then you've seen before in these products.

At the end of the year, Coda will get the same HTML5 user interface that was introduced for Agresso, said Duarte. The vendor also plans to add functionality around the core Coda product such as consolidation, cash management and travel and expense management.

Much of the drive towards a cloud-centric strategy has been driven by Unit4's experience with FinancialForce.com, a joint venture with Salesforce.com in which Unit4 has the larger investment. Duarte described its influence as a welcome form of 'contamination' spreading through the rest of the organization:

The positive contamination that FinancialForce brings to Unit4 cannot be underestimated. We are leveraging across the value chain the experience of FinancialForce to indoctrinate the discipline of cloud in sales, marketing and R&D in a big way. That is something we cannot underestimate.

What we are doing systematically is having [FinancialForce.com CEO] Jeremy [Roche] and other executive team members sharing their experiences ... We're leveraging them in a big way to drive the change agenda we want to drive within the company. We are not shy on leveraging them as a change agent within Unit4.

The company can now pursue a more ambitious transformation and growth strategy that wouldn't have been possible as a publicly listed company, said Duarte:

Part of the strategy is, when we've gone private we've done some interesting moves around alignment of our objectives to the starting intent. We beefed up the growth expectations that we wouldn't be able to do as a listed software company, where you're handcuffed to the 90-day window that the shareholders give you.

Pacing customers

Now the main constraint is the vendor's ability to bring its customers along with it as it pursues the ambitions expressed in today's press statement to "capitalise on the disruptive opportunity for innovation offered by today's Software as a Service (SaaS) and mobile technology evolution." Duarte said that the strategy will continue to give customers the final say on the pace at which they embrace change:

What we are presenting is a significant evolution without disruption. We need to get out of the hype of the cloud and get real in what customers really want and expect from us.

Customers want to adopt innovation at their pace — and that was always the case. The pace of innovation is faster than anything I've experienced in the last twenty years but you need to allow alternatives to the client. We are giving them space to evolve at their own pace.

I don't know of many clients that want to deply a full ERP on the public cloud. The evolution is happening mostly from an on-prem to a private cloud — deploying ther global setup on a private cloud and in many areas test-driving in public cloud environments [to] test it out as an evolution before they bank their business on a fully cloud model. So it's a hybrid cloud deployment as the natural next step for many customers.

We give you choice. You can innovate at your own pace. The reception from the clients has been pretty outstanding. It's not an all-or-nothing like some of these public cloud vendors are promoting — that's the cloud we want, that's the innovation we want. I think we're playing very much in tune with the decision makers in our clients.

Full details of the new executives announced today are given in the press statement released this morning. Here are the key points:

Renewed focus and investment will accelerate [Unit4]'s transition to a fully cloud-based company and support long-term initiatives including the continued growth of FinancialForce.com, deepening Unit4's presence in existing vertical markets, expanding into new verticals and geographies and pursuing operational excellence across the company.

To deliver on its new innovation strategy, Unit4 has aligned company management to the client lifecycle by creating a number of new positions at the Executive Leadership level covering marketing, sales, service, product and technology. It has also created a role devoted to driving strategy and transformation in the business.

• Stephan Sieber - Executive Vice-President, Strategy and Operations. Stephan joins from SAP where he held multiple leadership positions including Managing Director of SAP Switzerland and Chief Operating Officer of the DACH region (Germany, Switzerland and Austria).
• Ivo Totev - Executive Vice-President, Global Marketing. Ivo will join Unit4 from Software AG where he serves as CMO and Head of the Cloud Business with responsibility for global marketing and product marketing and is a member of the Group Executive Board.
• Paul Vogel - Executive Vice-President, Global Sales. Paul joins from Siemens where he was Executive Vice-President Global Sales and Services of the Software Product Lifecycle Management division. Paul has extensive enterprise software experience having held international leadership positions with JD Edwards and Peoplesoft.
• Gonçalo Leitão - Executive Vice-President, Global Services. Gonçalo joins Unit4 from Atos, where he was Senior Vice-President for SAP services globally. Prior to Atos, Gonçalo had a long and successful career at SAP where, among other responsibilities, he held the positions of Senior Vice-President of Services and COO, EMEA and Latin America.

Verdict

This is a big influx of new faces at a critical time for Unit4 as it seeks to seize the opportunity of its newly private status. All have solid backgrounds in the European enterprise software industry — perhaps a little too solid for my liking. Will the valuable 'positive contamination' of FinancialForce continue to make headway with so many new personalities eager to make their own impact? Much will depend on the ability of the yet-to-be-revealed  individual appointed as CTO to drive a truly mobile-first, cloud-centric agenda. We'll find out more on that score in September.

Unit4 faces the same two-speed challenge as any established enterprise software vendor. The majority of its customer base is eager for the benefits of modern digital technology but diffident about the impact of too much technology and business change all at once. The vendor has to find the right balance betweenn those conflicting impulses — not so fast that it loses the confidence and trust of customers but not so slow that it concedes ground to competitors.

We'll need to see how this new team beds in before we find out whether they can get that balance right.