Helming the cloud

FOR Kevin Samuelson, chief executive officer of technology company Infor, 2020 has turned out to be quite an eventful year. On the personal front, early this year before movement restrictions came into effect due to the coronavirus pandemic, he and his family moved from their apartment in Manhattan, New York, to a rented house with a large yard near the sea in Long Island, at the outskirts of New York, to "hunker down". Home schooling for the kids and running near the sea are keeping him occupied during non-work hours. He does, however, miss his favourite sport, skiing.

The real action, of course, has been on the work front. While many organisations have been reeling due to the downturn triggered by Covid-19, Infor has been doing smartly well. While this might be somewhat surprising and exceptional in a situation where economic growth has jumped off the cliff into the sea, so to speak, the key to the company's robust performance lies in its line of business.

In tech parlance, Infor is an enterprise software company. It makes applications and software that help enterprises run their businesses smoothly. These products range from, among others, software that keeps track of the supply chain and helps enterprises in their resource planning to tools for financial book-keeping.

There are several companies in the same business. However, Infor's go-to-market model is unique in two respects. One is that instead of spreading itself horizontally over many industry verticals, Infor concentrates on a few particular ones (like manufacturing and food and beverages, among others). This has helped it to develop products and solutions specifically for these verticals. So instead of shoehorning a general product for the express needs of a vertical, Infor builds the products from ground up, keeping in mind the needs of that particular vertical.

The second difference is Infor's cloud-based product delivery. It uses a software-as-a-service (SaaS) model, meaning that companies buy a subscription and get to use Infor's enterprise software as a service over the cloud.

This is where Infor has hit a sweet spot. With lockdown restrictions in place across the globe, companies have been scrambling to develop remote working modules for their staff so that they can work from home. As a cloud subscription service, Infor's business model is tailor-made for this kind of work environment, according to Mr Samuelson. And it shows in the numbers.

"The quarter ending in April witnessed Infor's second strongest quarterly booking for our SaaS offering in the company's entire history," the Infor CEO says.

"Many of our customers are predominantly in manufacturing and distribution, areas that have been very hard hit by the lockdown. The important point to note is that when companies are buying our software, they are making large financial and operational bets; they are multimillion-dollar purchases that can take months, or even a year, to implement.

"So the notion of being faced with that much uncertainty but still being comfortable making a large commitment, I think that speaks about how important it is to get to the cloud in order to have the agility required in today's business environment," says Mr Samuelson. He notes that most companies are looking for agility and visibility of the supply chain so that they can react in time to the uncertain situation that currently prevails due to Covid-19.

The Infor CEO adds that demand in the current May-July quarter, even with the massive shutdowns in the US and elsewhere, has been strong.

Adaptive and agile

Mr Samuelson acknowledges that the move to the cloud started even before the current pandemic. "Technology is probably the most profound tool that companies can use to capture opportunity in a changing world," he says.

Digital disruption has been a buzzword for a while, Mr Samuelson notes. "If you really dig under the surface, what does that mean? It means having a business model that is highly adaptive, that can be agile and adjust more quickly than has been done historically. And the underpinning of that is having systems, access to data, relationships with customers and relationships with supply chains that have that flexibility and agility.

"That's why I think wherever you look at digital disruption, at the core of that is great technology that's highly flexible, has access to huge amounts of insightful data that can be actually used to make a business better."

He adds that Infor is "uniquely positioned" to help customers with digital transformation. "A lot of our customers come to us, because they are either experiencing lots of change, or they're expecting to experience it and are looking at how to put in place a technology foundation that allows them to not just solve today's problems but also be adaptive and agile to be able to solve future problems," says Mr Samuelson.

"Enterprise software and the areas we play in are the most mission-critical technology products for our customers and that's why I think there's such a huge opportunity in front of us," he adds.

The privately-owned company was founded in 2002 under the name Agilsys through a series of acquisitions led by private equity backers. In 2004, the company changed its name to Infor. Early this year, Koch Industries bought the company in a deal estimated to be worth US$13 billion. Prior to that, Koch was both a major customer and a major investor in Infor.

Mr Samuelson, who first joined the company at its inception, is the third CEO of Infor. "I feel like I've taken the role at an incredibly fortunate time with a company that has great scale, and amazing products and an extraordinary opportunity. So I feel like I've sort of hit the lottery.

"If you think about the last time we went through a major technology shift from mainframe to client server, most of the companies that were great at mainframe either don't exist today or are a fraction of what they were. And that state and technology resulted in a whole new group of leaders coming into favour."

Mr Samuelson adds that there is a similar opportunity with cloud-based SaaS offerings and he feels "pretty strongly" that Infor's products are "far more advanced than what anyone else is offering".

"The industry focus that we have is differentiated and very difficult for anyone to copy in a short period of time. And in the SaaS world where companies really can't do lots of customisations, we're very uniquely positioned. With our ownership structure, we have one of the most powerful balance sheets in the world and a long-term perspective.

"I feel we have all the ingredients to do something extraordinary, to really change the game and change the dynamics in a huge market. If we play our cards right, in five years Infor will be a much larger company and will change the game in enterprise software."

On his own role in the company's success, the Infor CEO is very modest. "Frankly, I play a pretty small role and a whole bunch of different factors drive motivation for me as a person.

"When I started with Infor, we were a couple of dozen employees and one product, and to be here for this ride to be (today) well north of US$3 billion in revenue and 17,000 employees with dozens of amazing products and 70,000 customers, it's been a wonderful journey. And that creates a lot of pride and loyalty. I have an amazing team. It's fun to go to work as with all these ingredients that we have for success we see a huge opportunity in front of us," he adds.

Video vs face-to-face

This writer was supposed to meet Mr Samuelson in London in early March this year. Due to the Covid-19 situation that meeting got cancelled and the interview subsequently took place recently over video conference. In this context, responding to a question as to whether video conferencing solutions and remote working would replace face-to-face interactions in offices and public spaces post-Covid-19, Mr Samuelson notes that while there will be a lot of changes, "it will be a question of degree".

He says: "I still really enjoy in-person meetings. I think there are a lot of reasons that they are of value, certainly for anything big and important, and for forming a relationship that lasts for the long term.

"I also think a lot of good ideas spring from informal situations which occur in offices. So I don't think the current situation is going to result in massive disruption (in face-to-face interactions) in the post-pandemic future."

The Infor CEO is, however, certain that some things will not go back to how they were before the pandemic. Giving an example from Infor's own experience, he notes: "Prior to Covid-19, we had about 40 per cent of our workforce working remotely. I think that may go up to 50-60 per cent once things get back to normal.

"But the real impact will be on what I'll call the non-essential travel. A good example of such travel is product implementation. When our customers buy our software, we have a long implementation cycle and that's been done in large part with our people flying to the customer site and the customer flying their people in to our office, both spending weeks travelling back and forth.

"Now we are doing all that remotely and frankly, it's gone extraordinarily well, both for us and for our customers. So, in future I think perhaps there'll be on-site meetings at the beginning of projects, and then follow-ups will be done remotely," says Mr Samuelson.

He reckons other companies are likely to come to the same conclusion as Infor has. "There is a big advantage in doing customer support remotely; we can then have specialists serving areas that are perhaps in more challenging geographic locations, thus broadening projects and driving more value for customers.

"So I think there's no question that things will change. The degree to which it will change is still a little bit unclear, but certainly I can imagine there will be a lot less travel as a result of this experience," he adds.

But he does not think there will be a dramatic change in the way normal societal interactions happen post-Covid-19.

"I think things will return largely to normal. It'll not happen overnight, but even in our lifetimes, we've faced all sorts of challenges and there's a resiliency that people seem to have to take on these challenges and move past them. I certainly wasn't around for the World Wars, but the societies in those countries who took part in the wars pretty quickly got back to some sense of normalcy. I certainly was around for 9/11 here in the US, which was an incredibly traumatic event. But even in New York, how quickly have folks adapted?

"I have an extraordinary amount of faith in how we'll get through this, as challenging as it is... at the end of the day, we'll get to some sense of normalcy, even though there will be some lasting change, but we'll certainly get through it."

He adds that in a post-Covid-19 world it's hard to imagine that fanatic sports fans would no longer go to jam-packed stadiums or that there'll be no more sold-out concerts for music lovers. "Once it's safe again, humans are pretty social creatures and I think there's a lot of joy in those events. So we'll find a way to make them work once it's safe. There'll be a lot of changes, but I don't think that's an area that will change totally given how much people love all these social events."

It's been quite a journey so far for the Infor CEO who started his career as an English literature teacher at the American School in Sofia, Bulgaria. It is little wonder that with an English literature degree from college, Mr Samuelson reads widely on a variety of authors and subjects - from serious biographies and classics to thrillers.

"I actually think that it (reading) is more important now and is one of the things that have helped me in maintaining some sense of sanity. Reading and going out for a run - it's a pretty nice thing to be able to do in these circumstances," says Mr Samuelson.

And it's no surprise that, when asked about his favourite author, he immediately names Ernest Hemingway, a writer known for the sense of energy and enthusiasm that he conveyed through his prose - traits evident too in the Infor CEO, both at and outside work.

KEVIN SAMUELSON

Chief Executive Officer Infor

1973 Born in San Diego, California, USA

1995 BA in English Literature, University of California, Berkley

1996-1998: Teacher, Anglo-American School of Sofia, Bulgaria

1998-1999: Research Associate, Montgomery Securities

1999-2001: Equity Research Associate, Robertson Stephens

2002-2011: Senior Vice President, M&A, Infor

2011-2013: Chief Financial Officer, Infor

2013-2014: Chief Operating Officer, Backcountry.com

2014-2016: Chief Financial Officer, InsideSales.com

2016-2019: Chief Financial Officer, Infor

Since 2019 : Chief Executive Officer, Infor