Infor Lawson Evaluation

Infor Company Viability Review

The stability of Lawson depends in part on the viability of parent company Infor. The Infor financial data portrays a large and stable organization. As the 3rd largest ERP software vendor (behind SAP and Oracle) and the 10th largest software company of any type on a global scale, Infor provides business software applications to more than 70,000 customers across more than 164 countries. Revenue is approximately $3B annually (with 17% annual licensing growth). Staffing is about 8,000 employees spread across 120 offices worldwide. Infor’s strategic partner portfolio holds 1,100 names. Based on the figures, it's clear that Infor (and by extension, Lawson) has the solid footing (and deep pockets) to compete at a global scale.

However, like some other enterprise software legacy vendors, Infor’s product portfolio runs the gamut from Enterprise Resource Planning (ERP) to Customer Relationship Management (CRM) to Supply Chain Management (SCM), to Financials. Judging by the company's long acquisition history of mature business software solutions, Infor aims to gain a solid lock on the on-premises software marketing, and thereby the software license and maintenance revenue streams. However, this strategy now seems ill defined due to the high degree of disruption to the long standing licensed revenue model caused by the swing in the software industry toward Software as a Service (SaaS) and cloud computing.

Additionally, much of Infor’s revenue growth (somewhat similar to competitor Oracle) has come about via an acquisition route, including:

The flipside of such an aggressive acquisition strategy is that while revenue grows, so does the consequent technical debt and need for product rationalization to position overlapping solutions. Infor’s reputation has become (in the words of the IDG News Service) more of, "a holding company for its many acquisitions than a cohesive software vendor with a focused vision." Several industry analysts and pundits have long labeled Infor as a ‘patchwork quilt’ entity lacking a clear direction (hence the concerns over Lawson’s future in the immediate aftermath of the company's acquisition). However, the current Infor executive team seems more than willing to change or dispel this unflattering reputation.

In a move to better integrate portfolio products, the company created a new middleware solution, called ION, in order to bring some much-needed harmony to the many disparate enterprise software applications and also address the integration issues with third party solutions. As Ventana Research's Robert Kugel put it, "ION is designed to be easier and more economical…to get multiple applications to work together to execute end-to-end processes, whether the software is on-premises, in the cloud or in a mixed environment." ION, along with other new additions – such as common and shared business rules, localization, and reporting features – deliver much-needed cross product options for the company's software portfolio.

A second strategy is an increased focus on strengthening the company's emphasis on vertical market software solutions. The depth of industry differentiation is such that few business software vendors can effectively compete, and customers within the supported verticals can achieve significant savings in terms of implementation and maintenance. The ongoing Infor strategy is to use this array of specific offerings to increase market share in the Global 2000 – a segment that Infor believes will grow its value proposition and competitiveness.

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