Integrated ERP packages on the latest POWER7 servers promise to extend the value of the IBM i platform while moving companies to modern technology.
One little-mentioned part of IBM's recent POWER7 server announcements are the four IBM i Solution Editions the company introduced that include optimized ERP solutions from the four major ERP vendors—Infor, JD Edwards, Lawson, and SAP.
The IBM i Solution Edition packages feature the latest ERP software from the leading vendors and are designed to appeal to customers running older versions of the IBM i operating system that are looking to upgrade both their hardware and software systems. The ERP vendors are offering customers significant discounts when purchasing POWER7 servers in the Solution Edition configuration.
Amidst all the talk about new technologies and cloud computing, it's interesting if not comforting to note that thousands, or rather tens of thousands, of manufacturing companies continue to rely on the System i to run their businesses. In a Webcast this week, Jay Kruemcke, IBM's worldwide program director for AIX, made it clear that AIX is not displacing, and will not in the future displace, IBM i and its integrated features, including a database. Companies running IBM i may, however, add AIX solutions to the mix when they are not available on IBM i, Kruemcke said. With an integrated Power Systems platform, this step is quite feasible and suggests IBM i system administrators may in time wish to become more familiar with AIX.
IBM salespeople have told me that new customers (at least those in the Los Angeles area) seem to request Windows, UNIX, or Linux for their primary operating system, but the implication is they aren't familiar with IBM i or they think relying on open systems architecture gives them more insurance against obsolescence. The fact is, however, neither Windows nor Linux is as reliable as IBM i for running most manufacturing or financial businesses. AIX is quite reliable, but IBM i is extremely reliable. While some companies might be tempted to change platforms, those tracking their investments in IT and the return on those investments generally must confront the numerical facts: IBM i on Power Systems still has the best total cost of ownership around. Add to that its reliability and security features, and the grand old master again wins the contest.
One company that is committed to the IBM i platform and has put significant investment into IBM i solutions is Infor. Probably the leading provider of business software for midmarket companies, Infor takes pride in its technology development and support of the IBM i platform. The company just wrapped up its 2010 System i User Conference in Phoenix this week. Joe Marino, vice president of System i development and support at Infor, is enthusiastic about the new IBM i Solution Editions on POWER7 servers.
"Infor and IBM have partnered to deliver the IBM i Solution Edition for Infor System i solutions," says Marino. "This is an important step in bringing a combination of Infor System i ERP and POWER7 processor-based systems to a set of customers that want simple, integrated solutions at a lower price," Marino says. "We believe that this solution will be valuable to a large set of customers and will be a great success in the market."
Infor recently announced a new solution for IBM i it calls Electronic Banking for System i that is powered by Cashbook. The full banking solution will provide customers a complete cash management system with a central interface that allows users to process, pay, and reconcile cash through one application with immediate updates reflected in their ERP systems. The solution sits atop the ERP system and includes modules for electronic payments, bank reconciliation, bank lockbox/automation, direct debits, and bank statement uploads. It's available for Infor ERP LX, Infor ERP BPCS, Infor ERP System 21, and Infor ERP XA.
Kari Miller is senior director of product management for System i at Infor, and in a recent blog, she noted that IT spending is on the rise. Worldwide estimates by Gartner put the annual spend figure at $3.4 trillion in 2010, a 5.3 percent increase over 2009. In 2011, we can expect to see another jump of 4.2 percent over 2010 with the estimated spend being $3.5 trillion, notes Miller. At the same time, manufacturers are again investing to improve their infrastructures and grow their businesses, says Miller. "Yet after the last two years, manufacturers also realize that every IT dollar counts—and needs to pay off sooner rather than later," she says.
Miller quotes a recent study of System i users—sponsored by Infor but conducted by The MPI Group—showing that all participating System i manufacturers believe that return on their investment is an important criterion in their purchases. In fact, 75 percent said ROI was "extremely important." Not surprisingly, notes Miller, 71 percent of these manufacturers actually measure their ROI. "Savvy executives have long known that in making IT purchases, it's especially important that they project total cost of ownership [TCO] over the life of the investment," Miller says.
However, given the array of tempting new products regularly hitting the market, many manufacturers have been known to "lose that TCO focus" as systems become familiar and newer IT options entice buyers, notes Miller.
Infor has one of the largest installed bases of any System i software vendor, with about 15,000 System i customers. The company notes that tens of thousands of manufacturers continue to benefit from the System i's favorable TCO. The longer they keep it, the better their return on investment. When there are free dollars to invest in IT, many of these manufacturers are putting them into new System i solutions to stay current with IT trends "without the expense or pain of a platform change," says Miller.
Infor has a means of upgrading its System i-based ERP solutions through what it calls Infor's Flex Upgrade and Flex Exchange programs. With the new IBM i Solution Editions, both IBM and Infor now have another option for customers that puts them on the POWER7 platform while leveraging the benefits of IBM i's TCO. The customer can extend the original investment in the platform yet upgrade both software and hardware to a modern system. Given the performance, value, and price advantages of POWER7, as well as the investment in new software technology from companies such as Infor, concerns about the longevity of the IBM i platform might be equated with Mark Twain's comment that "the reports of my death have been greatly exaggerated."
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