Internet-driven, real-time enterprise systems, with automated business processes supporting global operations 24/7, that are not only fast to install and implement, but easier even than a PC to maintain. Those are the top line promises of ERP-plus developer PeopleSoft – and for manufacturers too. Brian Tinham reports
Internet-driven, real-time enterprise systems, with automated business processes supporting global operations 24/7, that are not only fast to install and implement, but easier even than a PC to maintain. Those are the top line promises of ERP-plus developer PeopleSoft – and for manufacturers too.
At its ‘Connect’ European users conference last week in Barcelona, the company insisted that it is very serious about manufacturing industry, holding out its high profile acquisition of mid-to-large ERP system developer JD Edwards this summer, and latterly demand flow and lean manufacturing software company JCIT, as proof.
CEO and president Craig Conway said that existing and new industrial users of the former JD Edwards ERP systems, and of PeopleSoft’s own, will find a strong, collaborative partner in PeopleSoft.
High on his agenda were new software products aimed at speeding-up implementation and improving system management and integration with other systems. He claimed the company is investing heavily in R&D to bring a far better “total ownership experience”.
That deal will be auto-installation and set-up, self-healing software, automatic application performance monitoring, improved ‘useability’ based on frequent task analysis, and so on – all of which can make a significant contribution.
He and chief technology officer Ric Bergquist also announced upgrades to the firm’s supplier relationship management (SRM) portfolio, with analytics and improvements across purchasing, e-procurement and collaborative sourcing.
And they majored on ‘instant messaging’ and mobile systems to streamline communications and action, as well as developments with the portal aimed at providing managers with instant assessments of training, licenses, upgrade levels and so on.
Add all this to the company’s third quarter results, due to be posted shortly, but with indications showing better than expected performance, and suddenly PeopleSoft is looking like a very interesting industrial bet. Notwithstanding Oracle’s still-standing hostile bid for the company, the ongoing weak economy and arguably uncertain times, PeopleSoft is unquestionably doing well.
In fact, what was striking at the user event was the scale of attention given to manufacturing. Carol Ptak, who heads PeopleSoft’s manufacturing division, and is past president of the US APICS and co-author of the book Necessary but Not Sufficient with Dr Eli Goldratt (of Theory of Constraints fame), said: “60% globally of ERP software licenses are in manufacturing. We can’t afford to ignore that huge market… Craig Conway wants to be number one or number two in that market.”
And there are some big existing customers in manufacturing. Think of NEC, SSL, Toyota, 3M, Honeywell, Hitachi, Corning, Scottish Water and Poclain Hydraulics, which went live last month.
Ptak insists that PeopleSoft – although known primarily for its HR, financials and CRM (customer relationship management) software and its leadership in pure Internet architecture – had manufacturing-orientated ERP back in PeopleSoft 7.
She says the functionality was initially built in 1996/7, when industry was moving away from inventory to demand-driven management. “Systems had evolved from tracking inventory, to planning and managing inventory, to MRP, closed loop MRP, MRPII, and then ERP and advanced planning and scheduling (APS)…
“Enterprise [Peoplesoft 7] was conceived in that era with a product configurator at its core [the result of another acquisition] so it was ahead of the game even then.” It also had supply chain software, including supplier relationship management and APS.
“About half of manufacturing companies’ spend is direct [materials], indirect and service provision. We had all this functionality, but we hadn’t invested as much in the people and execution as we had in the financial and service sectors.”
On the other hand, for JD Edwards, manufacturing, asset-intensive operations and supply chain management have always been core. “Buying JD Edwards gave us credibility and excellent sales and execution facilities around the world,” says Ptak. And since the company is insisting it intends to keep both JDE’s systems – OneWorld Xe (now called Enterprise One) and its AS/400-based World (now Enterprise World) – as well as its own (Peoplesoft 8, now just Enterprise) all going, it’s tough to find fault.
Indeed, all the senior PeopleSoft execs I spoke to sang from the same hymn sheet: there is now a choice of three suites offering different horses for the various manufacturing and IT infrastructure courses.
Enterprise is the entirely Internet-architected big system, aimed, for example, at high tech manufacturers that are outsourcing production around the world, so needing real time ‘collaboration’, but not wanting to expose all their secrets (IP).
Enterprise One is the general purpose web-enabled, mujlti-platform (Unix and iSeries) client/server system, again very scaleable and with strength in multi-tier plant environments.
And Enterprise World is for those many in manufacturing still wedded to the AS/400 – which now has “indefinite support”, although the cost of maintenance is yet to be determined.
Ptak: “The power is in not consolidating these platforms, but in enabling interoperation between them at the people, process and data levels.” PeopleSoft’s approach here involves a mix of common portal technology, Web services and data warehouses – with common look and feel where appropriate – and the firm demonstrated much of that potential at Connect.
“And it’s in transferring ‘domain expertise’ and technology between the systems to expand each one’s functionality natively – and then building additional tools on top.” An example of the latter is the company’s graphical Solutions Modeller, due out imminently; others are the analytics and the portal.
And there’s the move to common open, browser-based client systems and application and web servers across the systems. But as Bergquist insisted: “There will be no common code.”
No-one is saying there will be no be consolidation: clearly it will happen throughout the company’s new global organisation and as described. But Conway insisted that PeoleSoft wants users to be able to choose both systems and platforms that best suit them, from the Linux operating system (now available) to OS/400, whatever database and whichever compute boxes.
“This is not about consolidation: we want this to benefit our 11,000 customers,” said Conway. And Pat Quirk, general manager of PeopleSoft’s supply chain management practice, emphasised that it’s here to stay. “We have users on all of these systems, and we’re making money from them all. Why would we want to stop that?”
Are they all ‘protesting too much’? Who knows? But for now at least, three systems and the rest are central to the persuasion strategy.
As for the Oracle situation, Conway was characteristically upbeat, even comical, parading pictures apparently of his dog in a bullet-proof vest, in a sideways reference to an exchange of remarks involving Oracle boss Larry Elison.
His view: the still ongoing Oracle attempt at a hostile bid was predicated on disrupting PeopleSoft business during the JD Edwards acquisition, with its implications in terms of scale and enterprise applications world ranking conceivably damaging to the former.
It’s one view; another is that Oracle’s bid was and remains genuine, was initially misrepresented to the user community by edited comments in the popular press, and that Oracle could yet be a safe pair of hands. Either way, the jury is out in the US awaiting antitrust rulings next month, and until then the offer still stands.
The fact is that if Oracle is allowed to pursue its attempted take-over, a lot will hinge on PeopleSoft’s financial performance and its effect on the share price. For now that looks a difficulty for the Oracle bid.
This story, as they say, is set to run and run.
Author: Brian Tinham