* The combined force of J.D. Edwards and PeopleSoft could be threat to SAP, Oracle
A union was formed last week that bodes well for the world of e-business. PeopleSoft announced it would buy up its rival J.D. Edwards for $1.7 billion. The gist of the purchase: Two customer bases are better than one – particularly if you’re trying to compete with the likes of SAP and Oracle, two giants in the e-business applications world.
A few short breaths later, Oracle announced its intention to buy up PeopleSoft, and possibly in turn, J.D. Edwards. For right now, let’s focus on the PeopleSoft/J.D. Edwards union and what fruit it could bear. We’ll tackle the possibility of the Oracle takeover of both in next week’s newsletter.
The combined company will boast $2.8 billion in annual revenue, 13,000 employees and more than 11,000 customers in 150 countries. That portfolio spreads across the service, distribution, manufacturing and other industry sectors. Each has products that handle CRM, supply chain management, real-time business process management, enterprise asset management, and human capital management.
J.D. Edwards chairman, president and CEO Bob Dutkowsky said in a statement, “With PeopleSoft’s strength in the large enterprise space and services industries, combined with J.D. Edwards’ position as an acknowledged leader in midmarket and manufacturing, we will be able to serve the entire enterprise software marketing in a way no other vendor can.” Then he reiterated both companies’ devotion to their customers.
Analysts say the deal is important for PeopleSoft to be able to increase its share of the market – it needed a bigger and more diverse customer base. But to me, the true power of the merger will be the engineering minds behind both companies’ products. After all, two heads are better than one.
Hopefully, they will spur on each other to create scaled down, efficient, easy-to-deploy versions of their supply chain and CRM tools. Maybe together, they can figure out how to cut the time to realize ROI and make these products appealing to all enterprises. After all, there’s a perception that CRM and supply chain and most other kinds of business process management tools are costly and difficult to deploy. They seem to require a lot of support and have extended product cycles.
The real strength of this union will be its ability to turn the concept of business process management on its head and get enterprises of all types into the mix. If this happens, watch out Oracle and SAP, you might just have some competition.
