One expects a company that sells customer relationship management software to know a thing or two about managing customer relationships. For example, when the firm in question is the target of a hostile takeover from a longtime rival, what action should it take to convince customers the suitor will
not be successful in its efforts and that they have nothing to worry about?
If the company is Pleasanton, Calif.-based PeopleSoft, the answer is to throw some cash around because nothing says long-term viability like a fistful of money.
At its recent user conference in San Francisco, PeopleSoft paraded out several flashy initiatives aimed at easing customers’ fears over a potential takeover by Oracle, a rival that has been in hot pursuit of PeopleSoft for the past 16 months.
For starters, it announced a US$1 billion initiative with IBM that will see Big Blue’s middleware baked into all PeopleSoft applications. Both Craig Conway, PeopleSoft’s chief executive and Steve Mills, senior vice-president of IBM’s Software Group, said the deal constitutes the most significant enterprise applications alliance in the history of both companies (for more on this announcement, see page 4).
In more practical terms, it means existing customers will be better able to leverage existing IT assets without having to rip and replace behemoth business systems. There were also some rumblings of IBM positioning itself as PeopleSoft’s white knight should things take a turn for the worse on the Oracle front, but both companies, along with industry analysts, have dismissed the allegation.
If the alliance of the century wasn’t enough to convince customers PeopleSoft is committed to them for the long haul, it took the wraps off a program called PeopleSoft Now, which is, more a less, a motivational tool to encourage customers to upgrade to the latest versions of its business software.
Until the end of the year, the company says it will encourage Enterprise, Enterprise One and World customers to upgrade their applications by providing a truckload of tools and services free of charge. Sometimes free comes at a price, but in this case, the company doesn’t appear to be any dangling any strings, other than the obvious one of customers actually having to spend the money to upgrade their applications. The payback, PeopleSoft says, is that the applications will be less expensive to run and provide “”dramatic”” functionality improvements.
Included in the free-for-all is a free technical upgrade, free technical support for one quarter after go-live, free access to more than 100 eLearning courses for five project team members for one year. In the “”not free but cheap”” category, PeopleSoft is offering a credit of US$100,000 on new application software licence purchases of more than US$200,000.
The final act in its bag of tricks was to announce that 3M will install PeopleSoft’s software at its manufacturing sites around the world. The deal is meant to serve as proof that if one of world’s leading companies can bet its future on PeopleSoft, it’s probably safe for others to follow suit.
Time will tell if Conway’s CRM strategy is successful, but either way, he’s given customers some substantial food for thought.
If you’re a PeopleSoft customer, please e-mail us at [email protected] with your thoughts.