PeopleSoft upsets merged customers
Published: 29 Jul 2004 11:05 BST
PeopleSoft is also on target this year to reach its goal, set in September, of cutting $167m to $207m in duplicative costs as a result of the merger, Gupta said.
Communications breakdown
Yet relations with some J.D. Edwards customers -- the small ones in particular -- are strained. A chief complaint is that PeopleSoft has communicated poorly about new licensing and maintenance models that it's pushing J.D. Edwards customers to accept.
Appetisers And, a 400-person food manufacturer in Chicago, worries that PeopleSoft's pricing schemes could bust its IT budget. PeopleSoft charges separately for products that J.D. Edwards had thrown in as part of a package, said Kerry Christianson, an Appetisers And manufacturing analyst.
In addition, the company is unlikely to get a discount on its upgrade project. PeopleSoft only offers discounts to customers that spend $100,000 or more on the project, Christianson said. Appetisers And plans to spend less than half that amount.
"I don't know if they really understand the smaller customer, which was J.D. Edwards' bread and butter," Christianson said.
Customers have the option to keep the same terms they had with J.D. Edwards, Gupta said, even though PeopleSoft does want customers to sign up for its standard pricing model.
A disenchanted base of small and midsized customers would be a major defeat for PeopleSoft, which acquired J.D. Edwards in part for its relationships with such companies. Many software makers, including SAP and Microsoft, are eyeing sales to midsized businesses as the potential antidote to tepid demand from large, multinational corporations.
Yet PeopleSoft may have fanned the flames of discontent when it snubbed Quest, a large J.D. Edwards user group. Looking to streamline its user group activities, PeopleSoft pulled its speakers from Quest's annual conference after a disagreement over the terms of its participation in the event.
"I think that poisoned the well to a certain extent," technology analyst Greenbaum said.
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