Infor CEO on strategy and today’s digital technologies
Infor, the privately-held enterprise applications solutions provider for industry niches, has recently concluded their regional conference, in Singapore. The one-day conference saw their global CEO, Charles Philips, keynoting to Infor’s customers in the region, as well as to members of Southeast Asia’s media.
To date, the 15-year old contender to Oracle and SAP, has raked in a total revenue of over USD3 billion, and currently can boast synchronised market growth across all regions, but more notably, its cloud-based solutions have been growing at a rate of 50-percent annually.
This is in part due to their efforts to upgrade and rewrite their products’ code so that they can run in multi-tenant cloud, or more specifically Amazon Web Services (AWS) cloud.
Infor CFO, Kevin Samuelson explained, “Instead of buying or building a data centre, we have partnered with AWS (to deliver Infor solutions).” The partnership began in 2014, with the development and launch of Infor CloudSuite solutions, and according to Samuelson, Infor has since gained the benefits of security, uptime and scalability, and now ranks in AWS’ list of top ten partners.
“We took products which had a massive amount of industry-rich functionality and cloud-enabled those, rewriting them completely whilst also adding all of that industry functionality that our customers customise, into the core product that we run on the cloud.”
This endeavour of cloud-enabling their solutions took up over half of their R&D dollars, and is to the point that cloud now contributes 20-percent towards the company’s total revenue.
“It’s eating away at our perpetual business, and in fact we are actively going to our customers who are paying us maintenance for perpetual and converting them to the cloud, so cannibalising that other revenue stream,” Samuelson said.
“I think that trend will continue and we will see very strong cloud growth with the rest declining. In a few years, it will be more than half revenue.”
Samuelson thinks this will be complemented by services revenue, thanks to the industry expertise that Infor possesses.
The modern and relevant application
To compete with the best out there in the market, Infor’s portfolio of enterprise applications is embedded with modern technologies like social, mobile, analytics and artificial intelligence. But, they are also emphasising relevancy with a thoughtful vertical strategy.
“Our verticals are pretty consistent, and it’s been our strategy since beginning to do manufacturing, healthcare, retail, and public sector,” said Samuelson.
He explained that to enter a new vertical, there first would have to be top-to-bottom expertise (for that vertical) in Infor, from sales to consultants to engineers to product functionality. “For us, it’s rare that we enter a new vertical. The only one we have entered aggressively of late, is retail.”
The retail vertical focus came about because Infor had discovered their manufacturing and distribution customers moving to retail, so it became “… a logical place to go.”
He didn’t rule out nor did he confirm, construction as a new vertical Infor would work on, but he pointed out that it is similar to manufacturing.
To illustrate how targeted Infor’s solutions can be, Infor Malaysia’s country director, Nazeroll Kasim, spoke about their last mile, or micro verticals, emphasis. “For example, the food and beverage vertical. We have solutions that come under the F & B umbrella, like bakeries, the sugar industry, and so on.”
Under manufacturing, micro-verticals that Infor has as customers can be divided into process-type and discrete-type manufacturing. They are automotive companies, automotive parts manufacturers, aerospace and defence companies, high-tech, garment manufacturers, chemicals, and so on.
Infor CEO, Charles Phillips opined that much of what Industry 4.0 (IR4.0) is, has only been theory so far.
“You actually have to have technology to bring all the components together,” he had said adding that Infor was bringing IR4.0 to life.
In essence, the whole lifecycle of manufacturing products, marketing, generating demand, capturing orders, distributing, manufacturing, logistics, right up to delivering products to the masses, is being enabled by technology.
Philips said, “The whole chain of collaboration or commerce, very few companies understand that whole process. You have to be an ERP company and understand both sales and marketing, and demand, and also a logistics company to deliver the product.
“We are the only company that’s both. So, we are bringing the world of logistics and ERP into one holistic suite.”
The rationale is that there is only so much that can be done in terms of productivity and going digital. Enabling trading partners to collaborate digitally on a platform however, can help push the envelope and kickstart IR4.0.
“So, we think we have the platform and the full end-to-end suite to help companies do that,” Philips said.
The Internet of Things (IoT) trend is also benefitting Infor, in terms of all the sensor data that is being collected. “All that data loses its value if you can’t put in some process to react to that data,” Philips explained, adding that their Enterprise Asset Management (EAM) solution is leveraging sensor data, and working with it to enable maintenance of equipment in public transportation industries.
In terms of artificial intelligence, Philips also viewed Infor as being ahead of their competitors, by virtue of having started earlier, understanding the different industries better, and having collected more data from all their industry applications.
Infor is looking at applying blockchain technology for a network of networks. Philips said, “We do need anonymous trading partners. We will get that (blockchain for network of networks). Right now, there is a consortium that is working on making that happen between networks. We are evaluating that now.”
For example, Infor’s commerce network, which Philips called a global ledger, could authenticate and be authenticated by other networks from other industries ie. raw materials in one industry moves to another network and another and so on, till it becomes a finished product.