By Mark Sutton
Swedish ERP vendor says SOA approach allows better offerings for agile operations
Enterprise application vendor IFS is expecting strong growth in the Middle East, building on revenue growth last year. President and CEO Alastair Sorbie, told itp.net that revenue grew by 60% for the Middle East region for the year 2005-2006, and that 2007 is "heading the right way as well".
Sorbie said that IFS' modular, SOA approach to ERP and vertical industry focus makes it much more suitable for the region's rapidly developing businesses as compared to other vendor's offerings.
IFS predominantly caters to the process industry, along with the utilities, telecom, retail trade logistics, service & facilities management, aerospace and defence sectors. In the Middle East, the company counts APM Terminals, managers of ports in Jordan and Egypt, Oil Field Supply Company (OSC), Brightpoint and telecoms infrastructure provider Alan Dick among its customers.
Many of IFS' customers choose their solutions because of their modular nature and the speed and flexibility that allows them in deployments, according to Sorbie. For large enterprises that may be expanding into the region or launching new operations, being able to just take the elements of the ERP that they require is a more cost effective and timely way to get systems in place than going with a full-scale ERP deployment.
"A lot of companies are building their presence in the Middle East, moving operations here, and they need agility, they don't want to get trapped in big ERP projects for two years, they want to set up and start operations straight away," Sorbie said.
By taking an SOA approach to development, IFS is able to create localized products quickly, and is also able to update the technology easily to include evolving requirements such as changing business regulations.
Gartner analysts Bill Maynard and Yvonne Genovese ranked the company in the ‘Visionaries' quadrant of the 2005 Gartner Magic Quadrant for the ERP manufacturing mid-market. The analyst report recognized IFS deep specialization in the manufacturing mid-market, and the flexibility and lower TCO of IFS solutions compared to other vendors, but also questioned the company's lack of brand and consistency of delivery in all markets.
Sorbie acknowledges that IFS has not been a high profile brand, but he believes the company is in a good position to compete with the big name ERP players. The company has 260 consultants in the Middle East and India region, with a further 600 R&D staff in Sri Lanka, and is building local partner capabilities, including a focus on emerging markets such as Libya and Iran.
"I believe we are an alternative to Oracle and SAP, and I think we can beat them. We have a very strong industry focus, if you look at the latest industry briefs for the mid-market, SAP don't [have that focus]," he said.
"Financial analysts say they can't see how IFS can survive against SAP, but at the IT market level, the view is very different. Some companies have been struggling for years with SAP deployments, so when their CIOs move job, some of them won't go near SAP again. If you don't like SAP, there are very few competitors who have the capabilities that we do. The market for ERP systems is growing 7-10% per year, we grew 15%, so we are taking share from someone," Sorbie added.