SAP is arguably the most recognized name in Enterprise Resource Planning (ERP) software, and it is ranked number one in ERP revenue. Its ERP product is designed to serve the Tier 1 market. The best way to define the Tier 1 market is to think in terms of a Fortune 1000 company. The revenue of a company that makes this list is defined in billions, not millions. In 2020, the company that ranked last on the list was PC Connection, with revenue of $2.85 billion.
Infor is arguably the least recognized name in ERP software. At one point its marketing campaign used the tagline, “The largest ERP company you never heard of.” Large it is—its annual revenue is $3 billion making it the third largest ERP company in the world. It serves customers in the Tier 1, 2, and 3 markets.
At Visual South, we partner with Infor, not SAP. You might ask: Why go with the company most people have never heard of?
On the surface it certainly seems like we would want to partner with the top-ranked ERP solution. To understand why we didn’t (and won’t), you have to understand how SAP’s solution compares to Infor’s. Not from a purely functional standpoint, but more from a strategic standpoint.
Since SAP is focused on the Fortune 1000, its software needs to be adaptable to any industry, from Walmart (#1) to PC Connection (#1000). As you can imagine, the needs of a global retailer are much different than the needs of a PC software/service company. This required flexibility adds a tremendous amount of overhead in maintaining and implementing the solution. For example, the first major step in an SAP implementation is defining to the ERP the industry the company is in. This is no easy task. The need to perform this step doesn’t mean there is anything wrong with SAP. Remember, it is designed for any industry in the Fortune 1000, so it has functionality for all those industries. No one needs everything it has to offer, so implementations start with shutting off what you don’t need.
Even when you configure SAP for the industry you are in, just supporting the ERP is a heavy lift. Fortune 1000 companies are more complicated than companies with $5-$250 million in revenue (our market); hence, the level of functionality needed from the ERP is more complicated. It takes a full-time staff to support SAP. Usually, there is also a staff of SAP consultants that don’t go away.
All this is standard operating procedure for a Fortune 1000 company. What happens if a company in our market were to implement SAP? The overhead needed to support SAP would be too much of a burden for the organization. The implementation would unwind, and the company would go back to spreadsheets. Look at it this way: Imagine needing a car, and you buy a 40’ tractor trailer. In addition to buying something way too expensive for your needs, the upkeep and ongoing maintenance would be a real burden. That doesn’t mean tractor trailers are bad vehicles, it just means that type of vehicle is not the right fit for the need.
Infor’s strategy is different. It focuses on producing solutions for specific industries with a specific level of revenue. The Infor products Visual South sells are designed for small- to medium-sized manufacturers (annual revenue of $5-$250 million) and service companies. Hence, when we implement an Infor product to a customer, we don’t have to configure the software for a manufacturer; it’s already configured that way. This results in much shorter – and less expensive – implementations. If a $75 million soft drink bottling company came to us for a software solution, we wouldn’t be able to help them with the products we sell. However, another Infor Partner who is focused on the bottling industry could help with an Infor product designed for that industry. That bottling company would also benefit from a shorter, less expensive implementation compared to SAP.
Since Infor has different products designed for different industries, Visual South doesn’t have to try to be everything to everyone. We can focus on a small number of industries and become experts in those industries. Infor’s specialization strategy also simplifies the implementation of the solution.
This strategy is aligned with Visual South as a company. All our employees have backgrounds in small- to medium-sized manufacturing or service companies, and have, in most cases, worn many hats at those companies. When we work with one of our customers, we are very comfortable with their environment and culture. It’s where we came from. As much as I would like to believe we can do anything, we would be lost trying to implement ERP in a company with revenue in the billions. A Fortune 1000 manufacturing company is a different animal than the companies we serve. There are more layers, more nuances, and more politics. We're more comfortable working with small- to medium-sized manufacturing or service companies. It’s what we know; it’s what we're good at.
Infor also appeals to the sense of order and design we have at Visual South. We like clean, well-thought-out solutions. Typically, software is created by developers as a solution to a problem. The result is software with a developer’s look and feel. It works fine but is somewhat clunky. Infor disrupted this model by incorporating designers into the development model. They work in conjunction with developers to create software that not only addresses business needs, but does it with a clean, beautiful design along with intuitive functionality. Think of a Blackberry compared to an iPhone. The Blackberry was functional, but the iPhone brought smart phones to a whole new level.
Now you know why in the SAP vs. Infor comparison, Infor is number one to us. It is our goal to help our customers be the best they can be. Software doesn’t fix everything, but it can provide information and clarity so the talented people running the company (and the talented people working there) can make better decisions together. Infor’s software solutions fit our business model and culture.
If you are interested in ERP software for a small- to medium-sized company, you should read my eBook on How to Select ERP…and not regret it. Click on the image below to download the eBook.