Peoplesoft Inc - New Directions And Strategies

NEW DIRECTIONS AND STRATEGIES

PeopleSoft continued to branch out in new directions into the late 1990s. In 1998, the company announced that it would create a new business unit devoted to outsourcing services. Specifically, the unit would handle the outsourcing of business processes and technology. After seeing revenues increase approximately 80 percent in 1997, PeopleSoft secured lucrative deals with both Boeing and General Motors. Additionally, its manufacturing product was adopted by companies like 3Com and Hewlett-Packard.

In 1999, PeopleSoft announced that it would alter its strategy of selling enterprise resource planning (ERP) products directly to larger companies and make an effort to reach emerging smaller and medium-sized firms through resellers. The company planned to do so in secondary markets; at that time, its core U.S. markets were Atlanta, Chicago, New York, and San Francisco. In the last half of 1999, PeopleSoft's customers began to enjoy more applications from third-party vendors that were able to integrate with PeopleSoft products. This "open integration" approach was the result of efforts the company began in 1998, and promised to make the PeopleSoft's ERP products more attractive to customers.

Several big things happened at PeopleSoft toward the end of 1999. In October, the company made a huge acquisition when it acquired Vantive Corp., a manufacturer of customer relationship management software, for $433 million. Finally, in September Craig Conway was named PeopleSoft's CEO, assuming responsibility for day-to-day operations from Duf-field. After one year on the job, Conway commented on the impact he had made on the firm in Computer-world. "It's a very, very different company," he said. "We've retooled our management team and business processes, so we're a better-run company. And I think the company's morale and confidence is at an all-time high. . .I think I added an ingredient of intensity and accountability and competition to the corporate culture."

In 2000, PeopleSoft ventured into yet another new arena—professional services automation. It introduced its PeopleSoft PSA product, which helped companies match employees with projects based on their skills. PSA also was useful for managing other aspects associated with projects including billing, scheduling, and proposals. Finally, PeopleSoft became an application services provider (ASP) by offering its applications on a hosted basis via its eCenter.

Just as it had done in the 1980s by offering client-server-based solutions, PeopleSoft began focusing its efforts on a new model in the early 2000s. At that time, companies were interested in the potential business advantages offered by the Internet, especially in the area of transactions. In keeping with this focus, PeopleSoft channeled the lion's share of its resources into creating a "new pure Internet platform for the collaborative enterprise." Over the course of two years, the company devoted 2,000 developers and $500 million to the creation of PeopleSoft 8. The new platform made analytical and relationship data more pervasive and easily accessible for a company's employees.

Late in 2001, PeopleSoft introduced Enterprise Performance Management, a suite of software that included tools for modeling customer behavior. The software enabled companies to "pull data from PeopleSoft's operational CRM applications in real time and use that information to segment, profile, and model customer populations—critical for generating lists for e-mail marketing campaigns," according to InformationWeek.