PeopleSoft dismisses Oracle saga, touts IBM deal

The PeopleSoft/Oracle situation was the subject on everyone’s mind. It was also the first issue that Craig Conway addressed in his keynote.

“Have you ever had a bad dream that just didn’t seem to end?” the PeopleSoft chief executive officer quipped, to the seeming appreciation of more than 15,000 customers and partners at its Connect 2004 user conference in San Francisco Tuesday.

Conway was pointedly referring to the 15-month saga that is Oracle Corp.’s hostile takeover bid for the Pleasanton, Calif.- based ERP vendor. The all-cash tender offer to PeopleSoft’s shareholders currently has an estimated value of US$7.7 billion. A recent U.S. court ruling dismissed Department of Justice’s (DoJ) attempt to quash the transaction on antitrust grounds.

This does not mean that PeopleSoft will be acquired by Oracle, Conway said. Conway claimed PeopleSoft users are strongly against Oracle’s campaign and reeled off several points to calm fears. He noted that Oracle still needs to garner enough of PeopleSoft’s shareholders to eliminate its “poison-pill” and takeover its board, the DoJ can still file its own appeal and the European court has yet to make a ruling regarding the bid. Conway said that for legal reasons he could not would not comment further and the salient points about the deal was public record.

Despite the Oracle cloud, PeopleSoft has made progress in the past year, Conway said, and pointed to the “successful” acquisition of former ERP rival J.D. Edwards & Co. and the enhancements made to the JDE World and EnterpriseOne software solutions.

Canadian users at Connect didn’t seem concerned over the ongoing saga. Attendee Janice Paget, a Calgary-based director of controllership at WestJet said the Oracle situation isn’t on the airline carrier’s radar. The firm recently incorporated EnterpriseOne real-time financial reporting, commitment accounting, budget tracking and capital approvals technology.

As long as the technology is working and the support is there, it’s not really an issue, Paget said.

This sentiment was echoed by Don Beaton, director of financial information management systems for the Regional Municipality of Durham in Ontario. The organization is currently upgrading to PeopleSoft Enterprise Financial Management 8.8 from 7.5 and to Human Capital Management 8.8 and also has Oracle at the back end. The streamlined HR and payroll processing is saving the company about $7 million, according to JoAnne Cermak, the organizations’ director of finance.

The organization implemented the HCM module in 72 hours, with little manual configuration needed only for legacy components and with minimal disruption to end-users. With a staff of more than 5,000, invoices can now be printed in two steps instead of six and purchase orders can be built in three steps instead of four, Cermak said. PeopleSoft has been good in keeping the organization abreast of new happenings, Beaton said, adding he’s not overly concerned.

Gary Ouellette, a system administrator for London Hydro, noted that the Oracle state of affairs won’t be an issue as the London, Ont.-based energy provider completes a migration from World to Enterprise One. “This migration was apparently the first such migration in the world,” Ouellette said. “It was scary smooth.” London Hydro is looking at getting into Web-based processing which brings Ouellette to Connect. Like most energy providers in Ontario, London Hydro is coping with the realities of a recently deregulated electricity market; Ouellette said the PeopleSoft technology enabled the company to amalgamate to one single platform. The company’s IT environment consists of Unix/Oracle platform, which was why London Hydro wanted to switch to EnterpriseOne from World running on AS/400, Ouellette said, adding that the future enhancements including PeopleSoft software for work orders, job costing and plant maintenance.

“We’re in a stable environment right now and really don’t have any fears. We don’t believe that any future activity with Oracle is going to impede what we’re doing right now,” Ouellette said.


PeopleSoft made a host of announcements at Connect, most notably a new enterprise-applications alliance with IBM Corp. The US$1-billion deal (the companies would not comment on financial specifics) means PeopleSoft will standardize its apps on IBM’s WebSphere open-standards based middleware platform (including IBM’s Java application server, portal, and business process integration software) with both firms marketing the joint products. Users can thus use existing IT assets without having to rip-and-replace existing architecture, the companies said.

The PeopleSoft/IBM “ambitious and aggressive” deal is a significant announcement for both companies and also enterprise users, Conway said. PeopleSoft’s applications, at no extra cost, Conway said, will be integrated to run on IBM’s DB2 database and PeopleSoft’s development tools would be optimized for the IBM-backed Eclipse open-source development tool initiative. Steve Mills, senior vice-president and IBM software group executive, said the companies will roll out the jointly integrated offerings in over the next few years. The two companies also announced they will deliver new, pre-integrated industry solutions and establish a business process interoperability lab.

Industry observers note the strategic joint venture has the potential to make any future Oracle acquisition tricky since PeopleSoft’s applications will be integrated with IBM technology. The PeopleSoft/IBM combination effectively provides PeopleSoft with a middle-tier solution for handling application development deployment, data management, integration and workflow. That said, according to Toronto-based Warren Shiau, a software analyst Toronto-based IDC Canada Ltd., the announcement is a good move for both PeopleSoft and IBM.

“The tighter PeopleSoft’s apps are to a middle-tier software offering like IBM’s, the better PeopleSoft is going to be able to compete against SAP’s build-out down-the-stack with NetWeaver and against Oracle’s database-middle-tier-apps stack,” Shiau said.

PeopleSoft also announced several enhancements to its product lines, including new demand-driven manufacturing tools to enable manufacturing firm create a demand-driven manufacturing strategy. The company launched updated technology as part of its Total Ownership Experience initiative. The PeopleSoft Accelerated Upgrade software, a visual comparison tool designed to speed up application deployment time and cut down on IT support costs, will be rolled into the Enterprise and EnterpriseOne suites, the company said. The comparison tool allows IT application managers to see the difference in screens between the old version and the new PeopleCode, the company’s proprietary scripting language..

PeopleSoft CTO Rick Bergquist said the technology reduces the amount of downtime to migrate to the new system by 66 per cent. Instead of copying the old production system onto a backup server, users would only need have to copy application customizations and data to the new release, Bergquist said.

Also unveiled at Connect was Interactive Service Repository, a hosted customer support Web site that feature more than 1,500 enterprise application integration points or Web services provided by PeopleSoft for its applications. Also unveiled was Enterprise Human Resources Management Solution (HRMS) 8.9. The new HR product release includes more than 250 product enhancements, the company said, including new industry-specific enhancements and new functionality for contingent workforce and absence management.

PeopleSoft Connect runs until Thursday.

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