A company whose name many IT managers might still not know is quietly gobbling up enough business software firms to seriously challenge SAP and Oracle, and a Canadian acquisition may add to its arsenal.
Infor Global Solutions was only founded about five years ago by a group of investors from Golden Gate Capital, but it has used that time to purchase close to 20 smaller companies. This includes the takeover last August of SSA Global, which owned the Baan product line, for US$1.4 billion, and more recently Toronto’s Workbrain, a human capital management company, for about US$227 million. Infor now claims more than 70,000 customers, 8,100 employees and US$2.1 billion in annual revenues, putting it in third place in the overall business applications market. Its Canadian clients include Bell Canada, which uses Infor’s CRM for its inbound marketing.
Mike Frichol, Infor’s vice-president of global industry and product marketing, told ComputerWorld Canada the company was founded as Agilisys at a time when segments like enterprise resource planning were already considered mature. Its team, however, believed there were still niches available that SAP and Oracle weren’t filling.
“Those large vendors had scale and global reach and were trying to take large-scale, heavy applications built for large companies and force-fit them lower down into the market,” he said. “On the other hand, there are a whole host of niche vendors who are focused on specific areas like manufacturing, categories like CRM or supply chain. Most of those vendors didn’t have the scale to reach the larger marketplace to offer a broader spectrum.”
Unlike SAP’s NetWeaver or Oracle’s Fusion, however, Infor has no plans to create middleware to integrate the diverse products under its portfolio. Instead, it is developing what Frichol called Open SOA, a services-oriented architecture that will provide interoperability between Infor’s products and those of other vendors. Middleware like NetWeaver forces customers to use SAP’s tools to build applications compliant with its architecture, Frichol said.
“Customers don’t want to hear there’s a migration strategy, a convergence strategy or those types of things. They want to continue with their product line essentially unchanged,” Frichol said. “We are not attempting to smash the products together into a single solution set.”
A great deal of Infor’s money comes from maintenance revenue with those product lines, so it might make sense not to drastically change them, said Jim Holincheck, an analyst with Gartner Inc.
“It’s a different strategy. They’re not trying to follow in the path of SAP, certainly,” said he said. “Even though they have a lot of products in the portfolio, I don’t see them selling a lot of new products. I think they view innovation coming to some extent through acquisition as opposed to something they would organically build over a period of time.”
Holincheck said the Workbrain deal could provide Infor with some valuable assets around human capital management (HCM).
“It provides them some advantage and catches them up in an area they didn’t have much,” he said. “Oracle, with PeopleSoft, had a very strong overall HCM solution. Workbrain is a very strong time and attendance solution and that wasn’t an area of strength, relatively speaking, for PeopleSoft. Theirs is good, but it’s not necessarily best in class.”
Although Infor has a common technology group that is responsible for the SOA project, Frischol said its R&D is largely decentralized, with the development for individual product lines being done by the teams from the original acquired companies.