NZ software house taking R&D to US, Australia

New Zealand billing software maker Peace Software is moving part of its local research and development operation to Australia and the U.S. and Peace R&D vice president Tony Engberg says there’s keen interest among Peace’s 100 New Zealand staff in moving offshore to work at the planned new R&D centres.

“I assumed the numbers would be low, with less than five or six applying for each location, but we have more people interested in going than we’d planned to put in the centres.”

The initial plan is to have 20 staff at each centre and the US base will be in the “Denver-Boulder corridor” near Xcel Energy, one of Peace’s biggest customers.

The location of the Australian centre is still being decided, Engberg says, but it will be in either Victoria or New South Wales.

Engberg says the decision to move part of the R&D operation offshore came after a review.

“There are a couple of reasons — we’ve been doing several things with R&D in the past year, revamping it and making it more productive.

“We’ve introduced Agile programming techniques and gotten away from a software factory to a software engineering model.”

As part of the process, the company “looked at where there were new technology-based markets,” and the search included Australia, the US and Europe.

“We found that in some of them, especially Australia and the US, there was some innovative market activity by governments and other sectors.”

In Australia, the magnet was new regulatory requirements around type five metering, a technology Peace is keen to make products for. In the US, “we found some work going on in credits and collections,” he says. “We’ve decided to put small teams in Australia and the US, but the bulk of our engineering will be done in New Zealand.”

Peace’s local staff is stable at approximately 100, Engbeng says, and while that’s down substantially from the 250 the company employed a few years ago, he doesn’t foresee further reductions in the future other than local staff taking up positions at the Australian and US centres.

He says the company is closing “a number of big deals” and can’t talk definitively about future reductions until the deals are done, but based on current staff numbers, “there’s no indication of downsizing”.

All the deals are overseas, he says, leaving Peace with just one New Zealand customer, the Palmerston North City Council.

The reduction in staff from the peak of 250 came through attrition and a round of redundancies in January 2004, he says.

“We chose to keep working with less as people left and now we have a loyal core.”

Last year’s redundancies were made partly in response to customers demanding that partners such as IBM and Accenture implement Peace’s products, the company said at the time.