Q&A: The company's CEO discusses the company's plans to hone a deep vertical focus with more acquisitions while enabling integration with SOA-based apps.
In 2000 a group of investors led by Golden Gate Capital in San Francisco decided to start an enterprise resource planning company, Infor, in an era when ERP providers were trying to determine their future in an emerging Internet-based world.
Fast-forward to 2006: Infor has bought 19 software applications companies and is on the hunt for more. Its acquisition of SSA Global in August catapulted the company to the third-largest ERP provider in the world, behind SAP and Oracle, respectively.
With its combined acquisitions Infor now has 70,000 customers, 8,100 employees and $2.1 billion in annual revenues. But the company has some major hurdles to overcome if it wants to be considered a top tier provider for the midmarket—Infors sweet spot. Chief among them is interoperability between its many products, and overcoming the perception that it is a software provider engrossed with acquisitions rather than customer success.
Infors chairman and CEO Jim Schaper spoke with eWEEK Senior Writer Renee Boucher Ferguson about his vision and plans for the coming year.
Infors only been around for a little more than four years. Whats been the impetus for acquiring so many companies?
I get asked that a lot, "Why start a software company when no one was buying software?" When we looked at the market we looked a couple of areas and we decided on ERP and supply chain—different but parallel markets. This is a large market that is very complicated, going through a significant change, and was ripe for consolidation.
/zimages/6/28571.gifClick here to read more about SAP customers and the ERP market.
Once we made the decision [of a strategic direction] we spent a year looking at the way customers bought software, and what impacted them. We came to realize that companies buying software had two choices—not bad ones, just different.
One was to go with niche providers that are subscale in nature—great products, but they lacked global distribution and the wherewithal to build that. The other was to acquire products from large, horizontal providers.
They can distribute around the world but lacked industry-specific domain expertise. There really were only two options, and there are only two today.
We believe there was a hole in the market. So weve taken the best of both: industry specific niche providers and built a global, financially stable company that can implement anywhere in the world. Because were private we can [look to add] further support and look to additional acquisitions.
Where are there holes in your business that you would like to fill with either acquisitions or organic growth?
There are two different opportunities, or categories. The first is we are continuing to look for those applications that are both extensions to integrated ERP suites, as well as a product that can be sold as stand alone and integrated with our competitors software. For example: asset management, CRM [customer relationship management], warehouse management, and analytical performance management. These are several areas we are expanding into in the coming months and years. I would love to find an appropriate manufacturing PLM [product lifecycle management] vendor and human resources functionality. Then there are supplemental solutions like different types of reporting or tools around corporate performance management, logistics and transportation management that are interesting.
Second, we are moving into parallel vertical markets to those we already serve today. The reason we entered the wholesale distribution market is we had a lot of manufacturers that needed distribution, and a lot of retailers getting into light manufacturing. We see the same convergence of wholesale distribution with components of retail, POS [point of sale] and multi-channel retail capabilities. The same is true for the public sector and asset management. Well either acquire or build additional functionality around that market.