Peregrine in search of a second chance

Having emerged from Chapter 11 bankruptcy protection last year, Peregrine Systems this week will try to convince attendees at its annual customer conference that the company is here to stay and can help them better manage their networks.

Peregrine, which underwent extreme cost-cutting under previous CEO and fixer-upper Gary Greenfield to get itself in good enough shape to exit Chapter 11, now is looking to reinvest in technology and people to support existing products and deliver new ones. It will spread that word at its Synergy04 Global User Conference in Miami, where the company anticipates about 500 attendees.

One thing attendees won’t get is a clear picture of Peregrine’s financial status, given that the company only recently filed a statement for the 12-month period ending on March 31, 2003 (it posted a revenue drop vs. the year before, but was profitable) and has yet to say when it will resume issuing regular quarterly results. The San Diego company says by law it must stay tight-lipped for now about its financials.

But John Mutch, president and CEO, said last week that Peregrine plans to increase the number of service professionals on its staff who are experts in IT best practices, and is intent on boosting research and development spending. Over the past few years, the company has shed close to 4,000 employees (it now has around 650) and piled up about $4 billion in losses.

“We cut deep. . . . it’s time to reinvest in the company,” he said.

Peregrine this week will show customers – and competitors such as BMC Software – that it’s not standing pat by introducing a version of its help desk software. ServiceCenter 6 features improved Web and Windows clients and new reporting capabilities, and makes it easier to add help desk users when new modules are fitted into ServiceCenter, the company says.

A new version of AssetCenter, the company’s asset management product, is due in the fall.

Peregrine this week also will announce plans to combine its release management technology with change management technology from IBM Tivoli to make available a joint offering. Mutch said IBM’s public support now, as well as during the bankruptcy process, is vital to Peregrine’s sustainability (Peregrine generates about one-fifth of its revenue through IBM).

Peregrine is revising its pricing for new customers of its Service Control and Expense Control offerings. In the past a customer had to buy the same number of licenses for a new module as it had for the platform, customers now will be able to buy modules based more closely on the number of end users who actually need it.

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Mutch said that all the software advancements in the world are useless though, unless customers take advantage of them, adding that far too few customers do. To that point, Peregrine is planning a major effort to offer more services in conjunction with its software to ensure customers get the most out of what they buy and buy what they actually need.

The company has devised a model that it says takes customers step by step from being reactive to proactive. He called the effort “HPish” in that it has similarities HP’s Adaptive Computing model of synching and automating computing resources and services.

Vince Andreasen, lead technical support analyst for Carlson Hospitality in Omaha, Neb., says his organization has used ServiceCenter for more than two years and didn’t seriously consider dumping Peregrine despite the software company’s challenges in bouncing back from Chapter 11 and accounting fraud issues.

“We knew even if the company folded the product would survive,” says Andreasen, who last year helped Peregrine test ServiceCenter 6. Carlson currently uses Version 5.12 to support 800-plus hotels through its 18-person help desk in Omaha.

Andreasen says he is impressed with the GUI redesign in Version 6, which he says is in sync with Carlson’s desire to move to a more Web-based management model. Carlson, which is in the midst of rolling out the IT Infrastructure Library of best practices across its IT organization, is also encouraged by redoubled efforts at Peregrine to train more of its staff on ITIL, Andreasen says.