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Monday, June 22, 2009

Infor juices up its maintenance program value with Infor Flex

Infor announced enhancements to its software maintenance offerings today. The program, dubbed Infor Flex, allows customers at little or no license costs to upgrade to the latest, SOA-enabled versions of their Infor products or to exchange those products for other, newer products in Infor's portfolio.

I won't spend more time describing the program, as Infor has a good blog post on Infor Flex with embedded presentations. On balance, I would say it is a good move on Infor's part.

As I've written in the past, with its huge installed base, Infor has an opportunity to differentiate itself from its competitors in terms of its maintenance program. Many of its customers are on older legacy products, which Infor or its predecessor companies acquired over the past several years. Some of them pay maintenance, others don't. Most of them are going to do something in terms of new systems in the coming years. Infor has some decent up-to-date products in its portfolio, such as Baan and Syteline. But how can they compete against SAP, Oracle at the high end, or Microsoft, Lawson, IFS, and others in the mid-tier? The only way is to make upgrading or exchanging the customer's legacy products a no-brainer. This is what Infor Flex is intended to do.

It remains to be seen whether this program will succeed in moving significant numbers of its installed base to its newer products. On the one hand, I spoke to one early adopter of Infor's Open SOA products a couple months ago, and he was very positive about the experience. He also spoke well of Infor's maintenance and support services. This is a good sign and it says more to me than any number of vendor press releases and statements about future direction.

On the other hand, by my observation, Infor gets "outsold" by other vendors, even in situations where it is the incumbent supplier. Current economic conditions are likely limiting its ability to more aggressively and thoroughly present its leading products, such as Baan and Syteline. Hopefully, the new Infor Flex program will provide a more compelling value proposition, allowing Infor to win more deals where it already has a customer relationship.

I would like to see this program succeed. In these days, customers need more alternatives, not fewer.

Update: I see Vinnie has already posted his view on Infor Flex. Read Flex should also include down, not just up. Vinnie points out that the "flex" option is only for more product and services, not less. A good point, but Infor is reluctant to give customers an option to pay less than they're paying now. Of course, Infor is not alone in this reluctance.

Update: Dennis Howlett weighs in, in his usual style: curmudgeonly. Read the whole piece, at least to see how Dennis can manage a reference to Hulk Hogan when talking about ERP.

Related posts
Infor's opportunity: value in maintenance and support
Infor buying SoftBrands, owner of Fourth Shift
Enterprise software: who wants to be the low-cost leader?

by Frank Scavo, 6/22/2009 09:11:00 AM | permalink | e-mail this!

 Reader Comments:

Frank, not about paying less. but about variablizing IT - one of the attractive things about SaaS and clouds is bite sized provisioning and short time frame commitments - so you can increase and decrease as needs change. Besides let's face it as products mature cost of maintenance drops dramatically - so why not share with customers rather than just towards SG&A mostly to salespeople and margin for investors

Legacy, on-premise vendors just don't get this. In a long term relationship, customers will take care of you but there has to be give and take, not just take...
Vinnie, I think the on premise vendors "get it," but they don't want to do it, and unless forced to do it, won't.

As you know, we both agree on this. The on-premise economic model is broken, especially for vendors that are publicly held or want to be.
But, that said, if I'm an Infor customer, on an older product, paying maintenance, the Infor Flex program is a good thing. It gives me a reason to stay with Infor and some attractive options for upgrading if I am planning to move from my current system.
Do no run Infor Audits. You do not legally have to run the audits. Some contracts do not contain a right to audit. Request all your contracts before you run an audit if you do. Ask them what they will be auditing on. (License restrictions) Users, Server, Site, Mips ect. They will tell you it is a free service to you but if you are found uncompliant you will get big fees. Also if you are client that is being audited for the second time. Ask them what the restrictions were you were audited before and what they are now. Don't be surprised if the restritions have changed. You might have been audited for named users before and all of a sudden they are saying the definition of users is concurrent. They are not giving you back your money if you were found uncompliant under named users and now they are auditing under concurrent users. Your likey to be found uncompliant again. Thid is very dodgy.
In hearing the ramblings from my clients (most of whom use Lawson), I would hazard to guess that they would absolutely love to pay variable support costs if given the option. Many fret about being locked in to paying support fees irrespective of what they use, much less how much they use it. To this end, I would agree with Vinnie: SaaS would greatly benefit them. At the same time, however, this would scare the management of many vendors who've yet to get SaaS religion.
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