UPDATE: QUEST: Questions abound

DENVER – In the face of seeming uncertainty surrounding last week’s agreement to merge with PeopleSoft Corp. and the subsequent PeopleSoft takeover bid by Oracle Corp., J.D. Edwards & Co. trudged forward and unveiled its product road map at its Quest Global 2003 conference here Tuesday.

In front of an estimated 7,000 existing and potential customers, CEO Bob Dutkowsky reassured the audience that it is business as usual, pointing to the “400 new product and product enhancements” the company launched at Quest.

The Denver-based enterprise applications vendor announced several new product enhancements to the J.D. Edwards 5 collaborative enterprise software suite of applications, including its customer relationship management (CRM), enterprise resource planning (ERP), collaboration and integration and supply chain management (SCM) software. The company also targeted the manufacturing, consumer goods and life science verticals with specific J.D. Edwards 5 software enhancements.

Meanwhile, more than 15,000 information cards have been distributed at Quest touting the benefits of a PeopleSoft/J.D. Edwards merger. Even if the proposed merger falls through, Dutkowsky told media the company still has other options to pursue, “not the least of which is to go in and grab a bunch of dissatisfied Oracle customers.”

Despite Dutkowsky’s apparent optimism, analysts here noted that in the lurch are both PeopleSoft and J.D. Edwards customers, who may be waiting to see how things play out before making new purchases. It has yet to be determined whether Oracle is making a serious play or simply trying to disrupt the bid.

David Pollardy isn’t quite so optimistic. “It’s interesting that J.D. Edwards is calling the PeopleSoft acquisition a ‘merger,'” said the IT manager for Boise, Idaho-based Idaho Housing and Finance (IHFA), adding that he’s waiting to hear what PeopleSoft officially has to say. Currently using J.D. Edwards WorldSoftware, Pollardy said he’s content on his current IT infrastructure and the product enhancements released at Quest aren’t enough to convince him to migrate. It will be interesting to see in the long run how PeopleSoft treats J.D. Edwards customers once it gets a hold of the customer list, he added.

“Everything is still up in the air,” commented ERP Director Mehdi Syed for C.R. Bard Inc. Syed explained that the Murray Hill, N.J.-based health care product manufacturer currently uses PeopleSoft for payroll and HR and is in the process of implementing ERP software from J.D. Edwards, adding that as a customer the PeopleSoft/J.D. Edwards merger makes sense due to the complementary product offerings but “for their employees it’s probably a bit more complicated.”

Jim Klingenberger, a project manager for City of London, Ont. said despite all, the merger “appears to be well handled, well thought out.” At Quest taking in some J.D. Edwards 5 training courses, Klingenberger noted that like most, he’s waiting to see how things pan out before he comes to a judgement.

According to Tamar Gordon, research analyst for Toronto-based E-Search Canada, waiting is exactly what Canadian enterprises will do. The Canadian market has always been a very cautious and conservative one, Gordon noted. In Canada, J.D. Edwards factors heavily in the mid-market, particularly with its SCM solutions, but high-end PeopleSoft would be the big winner with the merger.

“PeopleSoft doesn’t have that sweet spot in the Canadian mid-market,” Gordon said, adding that the merger would create tougher competition in an already tight market. Organizations are in a wait-and-see mode, while vendors such as SAP AG are already devising ways to capitalize on the situation, she added.

Although she couldn’t comment directly on the merger news, Calgary-based Janice Paget, director of controllership at airline carrier WestJet, said the airline is happy with J.D. Edwards’ software and services and continues to use to work with the vendor to push real-time access to WestJet’s budget and financial data. The carrier underwent an analysis of several tier one and tier two enterprise financial management solutions, and went with J.D. Edwards’ automated offering that currently builds on existing architecture, Paget said.

According to Lloyd Crosby, an executive at EnCana Corp., the Calgary-based oil and gas company – created last year in a merger betweem Alberta Energy Company Ltd. and PanCanadian Energy Corp. – recently underwent a “challenging” OneWorld software implementation and was one of the first Canadian companies to use its energy software module. The recent news is definitely a concern since EnCana has made a long-term investment, Crosby said, adding the J.D. Edwards appears to be wholly committed to providing that support.

But Peter Rondinone, project manager for the Town of Newmarket, Ont., said while he remains confident in J.D. Edwards, the fact that Oracle is now in the mix does indeed complicate matters. The municipality recently implemented J.D. Edwards 5 enterprise resource planning (ERP) to manage its back office functions including financials, purchasing, human resources and payroll. The project was up and running within five months, Rondinone said, and enables less paperwork, increased efficiency and transparency of financials. It also eliminated the number of manual workarounds usually needed when operating in a heterogeneous IT environment.

“The Oracle announcement may put new purchases on hold, just to see how things impact the whole market, unfortunately,” Rondinone added. “I see things going into a lull, even if Oracle wasn’t around.”

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