Infor Touts Benefits of Industry-Specific ERP
February 2, 2022 Alex Woodie
Infor executives took to the digital airwaves last week to discuss the company’s strategy for delivering industry-specific ERP solutions, which they claimed can deliver better functionality to customers in less time, with lower costs and fewer risks.
The fear of time-consuming, expensive, and risky customizations is palpable among enterprises, Infor CEO Kevin Samuelson said during a roundtable with fellow Infor executives at last week’s Inforum Digital event.
“The reality is, when we go in to talk to a customer, they’re nervous because there’s a reputation for projects taking too long, costing much more than expected, and companies ultimately not getting the ROI and business improvement that they underwrote,” Samuelson said. “That’s not talked about enough.”
You don’t have to look too far to read about ERP implementations that go off the rails. In fact, some even involve Infor products, such as the Elmer Perkins fiasco that resulted in Infor paying the British retailer about $5.8 million after a failed implementation of M3 in the cloud in 2020. That’s not a slight on Infor, as any ERP vendor that’s been around long is bound to have some horror stories, of course. Oracle and SAP have had their share of ERP implementation failures, too.
To its credit, Infor is open to discuss the challenge of ERP customization, which is something that impacts all enterprise software. And in fact, Infor does have a decidedly different philosophy on the matter, although we’re not sure it was by original design so much as the result of Infor being created by acquiring dozens of different ERP packages.
No matter how it arrived at this point, the result is the same: Infor products do require fewer customizations because they have already been developed to address the specific needs common in industry verticals and many industry niches too. And unlike the “fusion” approaches undertaken by its competitors, Infor has avoided forced marches to consolidated product suites (although it has stopped developing a fair number of the many IBM i ERP systems it has acquired over the years).
“For us, there’s a big difference between having an industry-specific ERP versus an industry edition of a horizonal ERP,” Infor’s CTO and President of Products Soma S. Somasundaram said during the Inforum Digital roundtable.
“Generally, the market has been addressed with what I would call an industry edition of a horizonal ERP,” he continued. “The problem with that is you really cannot go and deliver the last mile functionality.”
A company in the healthcare industry or a public sector organization has decidedly different computing needs than a aerospace or defense company, Somasundaram said. And discrete manufacturers, like furniture or electronic device makers, have different needs from process manufactures, such as what you find in the food and beverage or the chemicals business.
“You take all of these and you multiply that hundreds of times and you put it into one product – that is an impossible things to do,” the longtime Infor CTO said.
That horizontal ERP approach creates a very bespoke execution environment for Infor customers, which makes it very hard to support the system in the long run, said John Frank, president of the customer experience group at Infor.
“This requires a significant lift from the services team to be able to bring that level of specificity to each of those customers, which we know is just not tenable,” Frank said. “Soma and his team have done a phenomenal job of getting us a leg up in the business. They’ve built that level of specificity and engineered it into the product itself.”
Companies walk a fine line between customizing their code and keeping on the upgrade path. On the one hand, customizations can deliver specific functionality that is a competitive differentiator in the market. Modifying a plan vanilla ERP package – or even rolling your own application – can enable a company to move ahead of its competitors by offering better service and delivering higher business efficiency.
But on the other hand, customizations can also bind a company to that particular piece of code. When their ERP vendor delivers a functional upgrade (or even upgrade the underlying architecture, as many ERP vendors have bifurcated their packages), companies that have modified their systems face extra work to bring those modifications forward into the new release. The level of modification can vary, ranging from wholesale changes of underlying source code that require lots of work to redevelop and test for the new system, to less invasive changes, like mere configuration changes or the addition of add-on modules. (In almost all cases, it’s the need to rigorously test the modified systems that consumes the majority of time.)
Infor argues that it can sidestep this longstanding thorn in ERP’s foot by delivering much of those industry-specific customizations as core features of its ERP offerings. It hasn’t completely eliminated the need to make custom code changes, as many BPCS, MAPICS, and System 21 users will attest to. But the company claims that its vertical-specific approach gives it advantages over the plan vanilla strategies of its bigger counterparts, namely Oracle and SAP.
This industry-specific approach bares even more fruit as ERP is moved into the cloud, Somasundaram says.
“Even if you managed to do that customized install, these days everyone is going to cloud,” he says. “In the cloud, you don’t have an option [to customize the ERP package]. It makes it even more difficult, even if you’re willing to spend the dollars and time to actually make the customizations. I would call it, you pour concrete. You can’t move.”