Posted By Jeff Moad, March 14, 2011 at 12:34 PM, in Category: Enterprise Resource Planning
The news that Infor has launched a $1.8 billion unsolicited bid for Lawson software should come as absolutely no surprise to Lawson customers. Enterprise software companies have been swallowing each other for years. Although Infor and Oracle have been the most aggressive swallowers, most surviving vendors have gotten involved, inlcuding Lawson which, in 2005, acquired Intentia International AB. The deal brought Lawson its M3 ERP package for manufacturers.
The deal makes a great deal of sense for Infor and probably for Lawson shareholders. For Lawson customers, however, it will mean some increased risk and some changes.
To Lawson, the deal would bring a singificant services and government customer base as well as an established manufacturing customer base in Europe where M3 still has its greatest penetration. Infor would benefit from Lawson's growing human capital management software buisness. And, of course, Lawson's customer base would allow Infor to beef up its maintenance revenues and leverage its R&D spending across a broader installed base.
And there are some obvoius synergies. Both companies have mature, vertical industry strategies. Both have similar approaches to the cloud, avoiding pure multi-tenant approaches in favor of teaming up with platform-as-a-service providers. (Infor with Microsoft and Lawson with Amazon.) And both go to market primarily through direct sales forces, although both are attempting to build indirect channels. Infor's larger sales force may be more effective in getting market penetration for M3 in North America, something which which Lawson's sales force is still struggling.
But the deal would bring some uncertainty and change to Lawson customers. Lawson's M3 and S3 products would suddenly be competing for R&D resources with a wide array of existing Infor products and projects. And, over time, Lawson's products would be required to mesh with Infor's technical architecture which, at this point, is heavily Microsoft-focused. That could mean some infrastructure changes down the road for Lawson customers.
It is the type of story all to familiar to users of legacy systems such as PeopleSoft, JD Edwards, Baan, and Axapta. The ERP consolidation trend is being driven by strong financial forces, and it shows no signs of abating.
What do you think? Would an Infor acquisiton of Lawson be good for Lawson cusotmers?
Written by Jeff Moad
Jeff Moad is Research Director and Executive Editor with the Manufacturing Leadership Community. He also directs the Manufacturing Leadership Awards Program. Follow our LinkedIn Groups: Manufacturing Leadership Council and Manufacturing Leadership Summit