Cloud-enabled Industry Functionality People Actually Want to Use
Infor is on a mission to “build beautiful business applications with last mile functionality and insights for select industries, delivered as a cloud service.” Supporting this mission are three strategy pillars:
- Specialized micro-vertical suites
- Powered by the architecture of the Internet
- That create experiences people love
In constructing these pillars, Infor hits on all cylinders of the go-to-market messaging surrounding the key technology trends today. But for Infor, this is much, much more than just marketing hype. Its portfolio of business applications is broad. Its executive team has a very deep understanding of the products, the underlying technology and the business itself, and has invested heavily in development. That investment includes a creative design team, which is large (about 100 people) and in-house. It’s all about bringing value to its current and future customers and growing its business.
Here we examine each of the three elements of its strategy in terms of the value it brings to Infor’s current and future customers.
Industry-Specific Features and Functions
Much of the functionality required in software that runs your business is quite generic. All companies must record basic transactions that create a system of record, and in some departments that are subject to regulatory requirements (e.g. operational accounting), creativity is frowned upon. This generic functionality has become a commodity today. Any good ERP solution today covers the basics, although the basics aren’t so basic any more.
However, no two businesses are identical and most growing companies actively seek competitive differentiation. Infor acknowledges these differences. In promoting its new CloudSuites, it likes to say, “No two clouds should be alike…because manufacturing tires is different than growing kiwis.”
And yet, one of Infor’s stated objectives is to eliminate customization. In order to do that, it needs to offer an unprecedented range of features and functions, some of which are very specific to certain industries. As a result, Infor is dropping down a level or two in its definition of industry. For example, some vendors refer to manufacturing in general as an industry. Others might concentrate on certain manufacturing sectors like automotive, aerospace and defense, high tech electronics, or food and beverage. But Infor thinks a bit more granular and will, for example, break out food and beverage into sub-verticals such as produce, dairy, beer, processed meats, etc., because each faces its own set of challenges. Dairies must worry about the variability of fat content, while breweries manage fermentation processes and measure alcohol content. Growers need traceability back to the field, or ideally, even a row picked on a certain date. Some food processors combine ingredients through formulas and recipes, while others have the equivalent of a reverse bill of material. How much bacon or pork loin you get will vary pig by pig.
These types of special requirements are often satisfied through customization, or not addressed at all by enterprise applications. Adding this type of specialized functionality to a single, general-purpose Enterprise Resource Planning (ERP) solution would certainly add an unwanted level of complexity. On the other hand, maintaining many different solutions that share some common requirements is a waste of development resources for the ERP vendor.
Through many years of acquisitions, Infor has actually accumulated quite a few different ERP and financial management solutions and has made a commitment to existing customers to never force them to rip and replace them. And so, Infor is faced with a delicate balancing act in prioritizing its investments.
Some of these solutions are quite mature and continue to be based on technology that has become outdated. Investment in these solutions is (and should be) minimal. Others are very modern and technology-enabled. Some were originally designed with a certain industry in mind, others were conceived as more general-purpose solutions. Decisions surrounding these solutions require careful thought. Some will be more strategic than others.
As Infor attacks sub-vertical markets, it is critical to start with the ERP solution best suited to each one. The specific industry functionality provided will be a better fit, and easier to deliver. In the case of food and beverage, for example, M3 is the selected ERP solution. Infor then builds out the requirements for dairy or beer or processed meats as optional add-on components. More on that in the next section where we talk about architecture.
Before we do that, let’s explore what this means for customers and prospects looking for a new solution. Mint Jutras has been collecting data on priorities in selecting software for years now. In days gone by, “fit and functionality” always topped the list. But over the past few years another selection criterion crept up in importance and appeared to be running neck and neck with “fit and functionality.” That criterion was “Ease of Use.”
In many ways, this makes sense. All the features and functions in the world won’t do you any good if you can’t figure out how to use them. But the ranking of “ease of use” and “fit and functionality” were so close, we started to wonder what the priority would be if users were forced to choose between them – hypothetically of course.
So in 2015 we changed the format of the question, again listing the different criteria, but this time forcing the participants to stack rank them from 1 (least important) to 10 (most important).
Table 1: Selection Criteria Priorities (ranked from 1 to 10)
It is quite clear from Table 1 that “fit and functionality” is still king. The top three criteria are all related to features and functions, which would indicate Infor is on the right track in terms of providing solutions that “go the last mile.” User experience (a broader criterion than ease of use) is still in the top half, which indicates it is much more than an afterthought. But getting the right software to do the job – the whole job – trumps all other considerations.
Infor needs to make the best of two worlds. It needs to be able to develop some generic functionality once and reuse it across multiple applications. And it needs to easily tack on new components of functionality, preferably making them optional. Infor’s answer to this is ION.
ION is lightweight middleware, providing common reporting and analysis, workflow, and business monitoring in one, consistent event-driven architecture (EDA). ION also provides an environment that enables new functionality to be developed once and shared by multiple products in the Infor portfolio, which helps in that delicate balancing act.
All of Infor’s strategic product lines have been appropriately “ION-ized.” This means Infor can develop functionality that can and should be shared across many of its different products, including horizontal solutions such as customer relationship management (CRM), human capital management (HCM), supplier exchanges and more, as well as localizations that deal with local country requirements in transaction basic business. This results in more innovation and a broader footprint than could ever be delivered by a single developent team focused on a single purpose-built product.
But Infor also feels it needs to go a step further: providing the architecture of the Internet.
Architecture of the Internet
Nobody today would argue the value of the Internet, bringing us “access any time, from anywhere” connectivity. Of course, the Internet implies “cloud” and Infor is moving into the cloud in a big way. As Infor (and also other major enterprise software providers) vie for leadership in the cloud, most assume the cloud is both well understood and a desirable goal. Mint Jutras research confirms that the market has reached a tipping point where cloud-based solutions are preferred over traditional on-premise deployments.
A question we have been asking for years now is this: “If you were to select a solution to run your business today, which deployment options would you consider?” In the early days of this question, those that would consider SaaS were definitely in the minority and almost everyone would, of course, consider on-premise solutions. That landscape has shifted dramatically. Figure 1 shows the most recent few years.
Figure 1: Deployment Options that would be Considered Today
* Option added in 2015
Note: The time span between the 2011 and 2013 studies was about 18 months as Mint Jutras shifted the timing of the study during the calendar year.
And yet, even with all this interest, Mint Jutras is absolutely convinced that many still don’t understand the terminology that is so easily tossed around today. Many use the terms “cloud” and “SaaS” interchangeably, but there are some important differences. So let’s distinguish between the two:
- Cloud refers to access to computing, software and storage of data over a network (generally the Internet.) You may have purchased a license for the software and installed it on your own computers or those owned and managed by another company, but your access is through the Internet and therefore through the “cloud,” whether private or public.
- SaaS is exactly what is implied by the acronym. Software is delivered only as a service. It is not delivered on a CD or other media to be loaded on your own (or another’s) computer. It generally is paid for on a subscription basis and does not reside on your computers at all.
All SaaS is cloud computing, but not all cloud computing is SaaS. Traditional on-premise or hosted solutions might (or might not) be accessed via the cloud, although these are more likely to be delivered through a private cloud. Not all of our survey participants want the same thing in terms of the cloud (Figure 2). Yet despite this diversity in preferences, Mint Jutras believes it is important for any software that can be delivered through the cloud to be able to fully exploit the power and benefits of the Internet.
Figure 2: How do you prefer your cloud?
This is presumably the reason Infor has set out to take full advantage of the Internet, regardless of what cloud means to its various constituents. It has developed a very clear progression that it refers to as Cloud 1.0, Cloud 2.0 and Cloud 3.0. This journey continues today but Infor’s stated goal is “efficient, scalable, secure, highly available, cost effective applications running on world class infrastructure in the cloud.”
Infor’s requirements for “Cloud 2.0” include:
- Multi-tenancy: This is the most efficient and cost effective way for solution providers to deliver a SaaS solution and aligns very well with Infor’s goal of “no customization.” Maintaining a single line of code precludes customizations that involve invasive code changes. Not all of Infor’s products offered as SaaS are multi-tenant today, but it is moving in this direction.
- Scaleability and high availability: These should be prerequisites for any SaaS solution, but both require data centers that can easily grow as needed, with an adequate level of redundancy for backup, disaster recovery and business continuity. Rather than taking on this responsibility itself, Infor relies on the massive remote computing services offered through Amazon Web Services (AWS), leaving Infor to concentrate on developing business applications rather than building and supporting data centers.
- Zero footprint and no local device dependency: By not requiring any software on the device used to access the software (desktop, laptop, tablet, smart phone, etc.), it delivers the access any time, anywhere promise of the cloud.
- ION/web-based integrations: Features of Infor’s light-weight middleware, such as its event-driven architecture, message-based communications between applications and industry standard object models for data definition, provide alternatives to point to point integration involving a lot of programming and invasive source code changes. Individual ERP products making up its different suites will of course need to be able to take full advantage of this middleware. Solutions that are deemed “strategic” will take full advantage, while legacy solutions based on older technology can and do have limited capability and therefore might not be good candidates for movement to the cloud.
- Successful security tests: Infor has three layers of security. Cloud-based products are required to follow acceptable protocols for software development and product release processes. It also has a team of ethical hackers, reporting to a chief security officer, that continually test and advise the development teams. And finally, it uses independent third parties for audits.
- Health Check Monitors: These need to be built into the software for self-monitoring of performance (think scaleability and high availability).
- No source code changes are allowed: But extensions, connected through ION, can be used to fill functional gaps.
- Meets patching and upgrade requirements
Cloud 3.0 will likely produce more changes that are “under the covers,” including more use of open source technology, better support for single instance deployments (think private cloud) and minimizing the use of third party products that would require additional purchases from the customer.
Providing last-mile functionality across a broad set of micro-vertical industries, supported by the architecture of the Internet is a lofty and practical goal. But Infor faces a unique challenge in leveraging this strategies in growing its business. Like any other solution provider today, Infor must attract new business. But it also must work hard to satisfy and retain its existing customer base of over 73,000 companies.
Many of these customers are stuck on older products, built on outdated technology. While promising to never force them to move off these old products is laudable, in a way it does the customers a disservice. In staying put, they will remain at a competitive disadvantage. Infor needs instead to lure them into making a significant change. That is where the third strategy pillar comes in.
Creating Experiences People Love
All too often companies and the people responsible for choosing to replace or upgrade solutions (or not) become complacent. The solution in place might not have all the functionality they need; it might be hard to use; it might not have produced the results anticipated. But change is hard. Many fool themselves into thinking old solutions, based on outdated technology aren’t “that bad.” They lose sight of how much solutions have evolved, both from a technology standpoint, and also in terms of features and functions. They cling to old customizations, not realizing a newer solution could probably be configured and personalized to satisfy their needs without invasive customization.
Many Infor customers fall into this category. What they don’t realize is that they could trade in their old solutions without changing solution providers. If they choose to go to a cloud-based solution, they also benefit by relinquishing the care and feeding of that solution to Infor, allowing the existing information technology (IT) staff to play a more strategic role in the company, adding more value than just keeping the lights on. And those running old versions of the products that are “strategic” for Infor might not even have to switch solutions.
Infor’s UpgradeX program is designed to get these folks on the latest release of these strategic products and then move them into the cloud. If their current ERP is part of one of Infor’s CloudSuites, the biggest effort will be in upgrading. If not, that probably means it will never bring them the kind of competitive advantage a more modern solution can provide. So these customers will need to migrate to a different solution, which means a reimplementation. But that is not necessarily a bad thing. Reimplementation allows the customer to rethink decisions that may have been influenced by prior limitations of the technology or the application. It’s an opportunity, but to get them to move, the target solution better be something that truly beckons.
While Infor has been talking about building “beautiful software” for several years now, it is the concept of delivering an experience that people love that resonates and should have a bigger impact on that portion of its installed base that has been clinging to older software. After all, beauty is in the eye of the beholder and Mint Jutras research has confirmed in the past that efficiency far outweighs the visual appeal of the software. In fact our 2015 Enterprise Solution Study confirmed it once more.
We asked survey participants to select the top three most important factors in determining “ease of use.” As in the past, minimizing the time to complete tasks took first place and intuitive navigation was a close second (Figure 3). The two are closely related, more for knowledge workers than those doing heads-down data entry. A decision-maker in search of answers that must hunt and peck for the right inquiry or function is certainly not minimizing the time to complete a task.
Figure 3: “Top 3” Factors Influencing Ease of Use
However, with all the talk of the impact of the millennial generation recently, we decided to look at this from a generational perspective this year (Figure 4).
Figure 4: “Top 3” Factors Influencing Ease of Use by Generation
This gave us a new perspective. While minimizing time to complete tasks still takes the lead for all three generations, it does so with a much smaller margin in the Millennial generation – actually by no margin at all. Beautiful software (a visually appealing user interface) was tied for first in the youngest of the three generations.
While it is more likely that a Baby Boomer or a Gen Xer will have final approval over the purchase of new software, Millennials will often be involved in the selection committee and will definitely be amongst the regular users of the system. So the perspectives of all three generations are critically important.
Yet for decades, user interfaces have been designed by software developers who have never walked a mile in the shoes of the customer, regardless of generation. Which is why Infor is providing more user experience options and is also now taking a radically different approach.
Several years ago Infor created Hook & Loop, its internal creative design agency. Typically software companies turn to creative designers for advertising and imaging, not for software design. But that is exactly what the Hook & Loop team does at Infor. The team has grown from six people to a staff of over 100. This team is not a team of software developers and as a result brings no preconceived notion of how software looks and feels. Instead it goes to those who do the work and asks questions like:
- What is your role in your organization? What are the different “hats” (roles) you wear?
- What is a typical day like?
- How do you interact with your co-workers and share information?
- What frustrations do you experience on a regular basis?
- What workarounds have you come up with to make your life easier?
- What are the (small) things that make you happy?
Remember this team isn’t developing the software. It is just designing what it will look like and how the users will interact with it. As a result, it is unfettered by all the distractions of the programming that very often leads developers down rat holes, creating added complexity and even scope creep.
Yet through its experiences to date, it has grown beyond designing each user experience from scratch, which is very important in terms of delivering innovation at an acceptable and accelerated pace. The team has developed a variety of page-level navigation methods for specific use cases, including approaches such as:
- Drill down / drill up
- Sections: Tabs
- Sections: Dropdown
- Accordion (expand and contract information)
If you talk to Infor you will hear them talk about the SoHo user interface, which is transitioning to SoHo Xi. Infor is quite fond of code names. What is more important to the users of the software is that it is designed to be efficient and visually appealing, both at the same time, whether the user is using a desktop, laptop, tablet, smart phone or any other type of device that may come on the scene.
The investment that Infor has been making over the past few years is now coming together and producing some pretty dramatic results. Its verticalized CloudSuites have been emerging on the scene. This of course is an on-going process, but expect more (functionality), and expect more vertical focus. New ways of engaging with ERP are being introduced. They are both efficient and visually appealing. These suites look nothing like the old software of yesterday. This is a new Infor.
Infor will not force its customers or its prospects to move to the cloud, but if they so choose, Infor will be ready and fully Cloud 3.0 enabled. Even if customers choose to stay on premise, they will still be able to benefit from the architecture of the Internet. But of course those stuck on older technology will have to take some action.
Mint Jutras has observed that some Infor customers seem to want to die with their cold, dead hands on old software. While that may be a tribute to the software, if you want your business to grow and thrive, we recommend getting on board with the Infor program. Of course you will have to get used to a new user experience, but we think it will be a welcome change. You could even fall in love with your ERP all over again.