Charles Phillips is CEO of Infor. Previously, was President of Oracle Corporation and a member of its Board of Directors. During his seven and a half year-tenure, the company tripled in size and successfully acquired 70 companies.  Prior to Oracle, Phillips was a Managing Director in the Technology Group at Morgan Stanley, where he was an Institutional Investor All Star for ten consecutive years.

Before his 18-year career on Wall Street, Phillips was a Captain in the U.S. Marine Corps in the 2nd Battalion, 10th Marines artillery unit. In 2012, Phillips was the guest speaker at the Marine Corps' 237th birthday ball for his old unit, after their return from Afghanistan.

Phillips holds a BS in computer science from the U.S. Air Force Academy, a JD from New York Law School, and an MBA from Hampton University; he is also a member of the Georgia State Bar.

Phillips serves on the Boards of Viacom Corporation, Jazz at Lincoln Center, New York Law School, the American Museum of Natural History, the United States Air Force Academy Endowment Fund, Posse Foundation, and his family foundation, Phillips Charitable Organizations. Phillips also served on the Obama Administration's Economic Recovery Board, led by Paul Volcker.

Twitter @cpinfor

Video Transcript: Charles Phillips, CEO, Infor

Michael:         

(00:15) Welcome to episode number 75 of CXOTalk. I am Michael Krigsman, with my friendly and he is friendly because everyone who knows him and he will say, he’s much more friendly than I’ll ever be, friendly co-host Vala Afshar, Vala.

Vala:   

(00:33) Hey Michael how are you doing.

Michael:         

(00:34) And we have a fist bump but we have no fist bump camera this time. Because we do this fist bump and nobody can see.

Vala:    That’s okay.

Michael:         

(00:43) And we’re joined today by a very interesting guest, Charles Phillips who is the CEO of one of the largest software companies – enterprise software companies in the world, Infor. Charles how are you?

Charles:          

(00:56)Okay Michael I would give you a virtual fist bump if I could but hello.

Michael:         

(01:06) Go ahead Vala, you and I are like we know each other to be this too polite.

Vala:   

(01:13) Yes, it’s episode 75, so Charles could you talk to our audience a little bit about Infor your background please.

Charles:          

(01:19)Okay, Infor is a business software company, so we build applications for certain industries to automate complex processes. Automotive, health care, public sector and things like that. We have about 13,000 employees and we’re headquartered in New York City, about 70,000 customers.

(01:38) My background, I’ve been here about three and a half years as CEO. Prior to that for seven and a half years I was president at Oracle Corporations in California. Then prior to that I worked on Wall Street for 18 years, mostly at Morgan Stanley, and then believe it or not prior to that I was a captain in the Marine Corps, so a collective background but that’s it.

Michael:         

(02:03) So Infor is one of the largest enterprise software companies and when one goes to your website, right at the top of the website it talks about beautiful software which is pretty unusual for an enterprise software company. So let’s start with that. Tell us about beautiful software, what does that actually mean, how did you get into that type of thinking about the software and so forth.

Charles:          

(02:36) Beauty and business software, you’re right hasn’t gone together but we’re creating that conversation as we speak right now. How we got there was, we’ve all been with the company and business for quite a number of years. The top executives all worked with me when I was at Oracle and we all joined here on the same day. And we have a lot of experience working and not being happy with the way the software looked and felt. The idea of having these great, beautiful devices at home, on your iPhone, an android phones, and all the cool stuff was happening in consumer software.

(03:12) AndWe said why shouldn’t business software you know learn from that and we’re all gadget freaks we like that stuff, so why can’t business applications be beautiful as well. And so we made it part of our mission when we came to this company now we had a platform and the resources that we could create a company in our image and do what we wanted. Let’s take on beauty as a confidence, and let’s take on beauty as a way to differentiate ourselves and how people understand beauty and design.

(03:41) So it drove the strategy and that’s one of the reasons we relocated to New York City so we could find people for new design.

Vala:   

(03:48) So you mentioned iPhone and certainly from 2007 and up to now you have close to 2 billion smart devices or computers in people’s hands and pockets. So certainly the executives and employees of companies are more comfortable with technology, is the consumerization in technology and business require enterprise software vendors to really think about design as a core competency moving forward?

Charles:          

(04:21)We believe so. I just don’t think the next generation of business users who use business applications will accept typically what we have done in this industry.

(04:32) Historically, the way the software looked was an afterthought and the people who bought the software didn’t have to use it, they were executives  who bought it but then you know, people in the back office had to use it and it was dictated to them and it was just never important. And I think going forward, if you want to hire the best employees and retain them, you have to make their jobs easier. You have to make the applications more consumer like as so we’re building software for the next generation is the way to think of it.

Michael:         

(05:01) But it’s not just user experience. This is not just a matter of pre-screens and nicely placed pixels it goes more deeper than that.

Charles:          

(05:12) Yeah, that’s why we don’t use the word just utilize and design standalone. The word experience means  how do you interact with technology and of course it has to look great as a new modern design, but we used this as an opportunity to kind of rethink how people interact with technology, and we reduced a number of steps and we made it more intuitive. And we study every day. We do this. We send people on sites and watch people work and say, they do these four things most of the time so let’s optimize around those four things and the other things we can put somewhere else.

(05:43) Solet’s look at the workflow and actually behaviour at work and what’s priority and then design the software. So it’s really about solving problems and not just designing software.

Vala:   

(05:53) Is the design principle based on a mobile first or mobile only design and does it take into account for example and adopted design and can you talk a little bit about on how much mobility is influencing your enterprise software design methodology?

Charles:          

(06:12)It is definitely a key design point and we use responsive design as a minimum. So everything we do works on mobile and we have some mobile only applications that depends on the area.

(06:24) But more importantly we want to make sure, that whatever device we’re on that to have a compelling experience  that you’re not reading manuals, you’re not sitting going througha training class for a month and we want to eliminate all of that, so it’s obvious what to do  .

(06:37) And so to do that we actually had to find people who came from different walks of life and not enterprise software who were experts in design.

Vala:   

(06:48) So I suspect in New York that means  20 year old, 30 year old, spikey hair, tattoo beautiful designers. Not your traditional enterprise software I was going to use the word geek and I consider myself one. But not your traditional enterprise software engineers is that a fair assessment?

Charles:          

(07:11)That’sexactly what happened and it’s actually kind of funny in which the way we kind of stumble into this. We said how can we find these people who know great design, because they don’t come out of enterprise software plumbing the way we do. So let’s find people who make us uncomfortable and someone different from us and find people who had to make people come to their websites and attract them there. You don’t have to do that with enterprise software, you have a captive audience they have to use it. But if they come from advertising or media they only survive if they do something that’s compelling and people want to use.

(07:40) And so I called a friend of mine who was running a startup and she worked for me at Morgan Stanley back in the days. She was in internet startup, so she was in that community. She sent me a couple of people over and it was kind of funny. They were all arrived in suits and your right they all had T-shirts, tattoos and spiked hair and their first comment was okay, one of us is in the wrong place.

(08:03) So it stretched us. We don’t look cool on the outside but we are on in the insideand we want to do this and we’ll give you authority and form a company within a company called Hook and Loop, that’s what they finally called themselves. But we just want you to bring yourself and your buddies and hire a bunch of guys like you.

(08:20) So we ended up bringing three or four people with them. And now we have over 100 people and they are all from different walks of life. So we have the head of graphics and designs in the graphic affects from the movie The Avengers and we have the Pulitzer Prize winner for information graphics and we have the first Apple(I-At?) creator. We have a documentary creator and on and on kind of designers. And these are people who I didn’t know who Infor was 18 month ago but they know great design.

Note: From this point this is where the call starts to break up.

Michael:         

(08:52) So you’ve got a group of people who don’t know enterprise software but know good design and on the one side and on the other handyou have an enterprise software company that has been brought together from a number of acquisitions and how do you marry these two, because these are very different cultures and ways of looking at the world. How do you bring it together?

Charles:          

(09:22) Well that was done as how do I get the traditional engineers – the other 4000 engineers who built industry applications to maybe understand certain  reasons and they know them well. To work with people and designed them and use the experience. And so we coached the groups to work together and once the engineers and the design guy looked at what was possible and with performance and looked that it was compelling and the engineers just said, okay we can’t do that and we understand why you have a design group in New York. (broken up call 09:58) Was why do we need these guys in New York, these kids in New York but it took some time to get it….

Vala:               

(10:04) We were talking about the physical layout in your office and how that reflects the importance of design and creativity. Can you talk a little bit about that?

Charles:          

(10:40) Much of our strategy was going to be around design and we had to attract people who care about design and physical space means a lot to them and you want to foster and create creativity and thinking about design.

You also want to send a message to customers as soon as they walk in that these people care about design and attention to detail.

(10:35) Also, we took a lot of time back in the office and make sure that it was fostered the way we work. That we can working groups and people have different spaces to change the venue and change their look around there space so they can (Sounds like: reach out is little bit 10:54) because we found that if they weren’t able to move it would interrupt what they were doing in multiple spaces and interacting with people helps and we wanted to be open and transparent that’s what we wanted.

(11:03) So, a lot of thinking went into it and we are expanding it now, we have had a lot of people come through and they are trying to figure out how to the design thier (inaudible 11:10) and creativity and the whole 9 yards. But it does help us in terms of creating the brand for the company and also the way we work.

Michael:         

(11:19) Charles we have a question from Frank Scarver, who you know is an analyst and Frank asks, what was that like making the transition from being a financial analyst to being a software executive at Oracle, and now at Infor?

Charles :         

(11:40) Well we have made a lot of transitions and as well as having (Inaudible 11:50) technology in all of my careers , so for me it was really kind of back in the future, I have met a lot of people and in the military you learn how to lead people, and that is the one place where that’s the only product is learning how to lead people and you get formal training in it. So that always helps when you are leading people, and going through the military academy you are studying leadership styles with ones that work and didn’t work, and you find your own style over time.

(12:17) So the transition for me was probably wasn’t the same as it may have been for someone else, you know without that background but it was the transition.

Vala:   

(12:29) Great going back to the culture of inclusiveness and open and fostering creativity, can you talk a little bit about of what your customers are telling you in terms of the benefits of using Infor software where design is helping them better understand their business and meet their objectives.

Charles:          

(12:57) We found that the system is intuitive, easy-to-use, accessible and more people use it, typically for business applications and especially (Unclear 13:08) applications and you are lucky to get 10 or 15 people backstage and log in to the application, and the only people that are forced to use it is with the transactions (Unclear 13:18) of the application. They may take the data to somewhere else and they will look at it but actually using the application that’s a small percentage of people. We want everybody to use it and so we’ve have found that ifyou think it is easy-to-use you usually get a much wider adoption which is for this product and because they get more value.

(13:37) Secondly, you have people who are more current and in agreement with it and (unclear 13:43) because looking at the data all of the time and you get to find stuff that’s left often which is (Unclear 13:48) and trying to get some consistency in the process of the data and (unclear 13:57) as we call it, where more people can use it and see it and helping with your company better.

Michael:         

(14:01) And what kind of metrics do you use to evaluate the success of this type of design program that you’ve implemented?

Charles:          

(14:13) Yeah, it’s always a bit subjective when you are talking designing and you know it when you see it, but you really get the feedback from the end-users. If they are working closely and if they want to use the software then change management is a much easier and it’s a big issue with these types of application. Likewhen people learn the old one, they don’t want to change unless there is a good reason to change. So the change management to have the end users excited and leave projects and finding to upgrade to this or upgrade to that. We want people who actually use the software to say we want that. So that is our metrics, and can we delight them and can we excite them so they want to use something different.

Vala:               

(15:08) You know, it sounds like you have brought multiple organizations together to create the modern Infor. You know, how do you spread design thinking through a diverse group of people, locations to create this unified modern Infor.

Charles:          

(15:27)We had the advantage that at the time the management team started at the same day initially taking over a company that knew it was about to go through some sort of change with the new team. So we had a blank sheet of paper saying we are going to change directions on everything.

(15:43) We hired an additional 1500 engineers and integrated all the products together and changed the design team’s strategy. Changed the headquarters location, so people were ready for change and they knew it was a project that they wanted to do better than they were doing. So we probably had a little easier time because once that decision had been made and brought in the new team and they showed the company.

That sort of worked out for us, but the people were ready for a change.

Michael:         

(16:12) So people were ready for a change, so what kind of challenges did you face because I imagine when you are talking about this type of internal transformation, there’s always going to be challenges that come up. So what were some of the challenges that you faced and how did you overcome them?

Charles:          

(16:30) Well we had to make some tough decisions on which products go forward and which wins and who is going to lead what teams. We brought a lot of new people in and the 13,000 people that are here, some 3000 of them were new in the last 18 to 24 months…

Michael:         

(16:48) We are very grateful to Charles Phillips who is the CEO for Infor, for making a superhuman effort to be here and also to his staff for helping to work out.

Vala:               

(17:02) Guys, have a great weekend and we’ll speak to you next week on CXOTalk.