Part of me is excited by the announcement that EQT, the private equity investor in IFS is also buying Acumatica. I have been saying for a while even after two decades of cloud applications, there are shockingly few operational applications for manufacturing and other industrial markets.
But the announcement also has me asking “so what?”
The good news is both units will continue to be autonomous. The history of enterprise software over the last couple of decades shows that integration of acquisitions/roll-ups can be very distracting and not really that beneficial to customers. Go look at the history of Microsoft Project Green, Oracle Fusion, rationalization SAP Cloud Properties and Infor CloudSuite if you want proof of that.
The bad news is both units will continue to be autonomous. IFS is increasingly focused on asset-intensive industries and is bringing field service into the modern age where assets generate plenty of data. However, it often falls into the trap of chasing too many broader ERP opportunities. Acumatica has a “cloud ERP” positioning but even less of a clear vertical/operational focus. Their customer bases are very different – IFS stronger in Europe, and with larger customers. Acumatica is US centric and SME focused. Their go-to-market is very different, with Acumatica heavily dependent on resellers.
So, I want to see what synergies EQT can bring across the two. As we have seen with Unit4 and FinancialForce, just having some common ownership does not easily translate to success in the field.
Personally, I hope EQT can sharpen the vertical focus at both. There are all kinds of opportunities for migrating customers to product design labs, shop floors and warehouses “of the future”. With the caveat that the future is already here when you see the robotics and wearables at the BMW plant in Greenville, SC and at Amazon’s distribution centers around the world. ERP vendors need to catch up and not just pretend 2D bar code scanners are good enough to modernize operational areas.
So, look forward to EQT’s detailed roadmap for creating what it promises will be a “global cloud ERP powerhouse ”
(Cross-posted @ Deal Architect)