Customer Relationship Management (CRM) might be a staid topic but unlike the Latham-Howard "great debate", at least the chief executives of two leading software companies -- Intentia and PeopleSoft -- had some pertinent views to exchange.
ZDNet Australia finds out how PeopleSoft's David Webster and Steve Ironside from Intentia sees the future of CRM software in Australia.
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WEBSTER: While Australia and New Zealand are relatively mature markets in terms of enterprise applications, there are always industries looking to technology to drive down costs, increase efficiency, and increase competitiveness. The mid-market space in general is becoming a real driving force, competing increasingly on a global scale. They are looking to put systems in place that will offer a low cost of ownership and high returns. Industries like manufacturing are entering a new era, where they need to be demand driven. Again, that requires a new type of solution that's only now available.
Financial services companies continue not only to look to technology to sharpen their edge through CRM and analytics, but also to help with compliance, which is still a major issue. Of course the public sector is increasingly looking to innovate. Areas like case management, Smart HR, workforce performance, CRM (or constituent relationship management as I've heard it called!) are all new areas of e-Government that Australia and New Zealand are taking a lead on.
WEBSTER: High on Intentia's agenda are job cuts to improve profitability. With 16 percent of the workforce set to be axed, how will you continue to support your customers or invest in R&D?
IRONSIDE: It is absolutely no secret that ensuring a strong platform for sustainable profitability is one of Intentia's priorities, and is fully supported by customers, employees and shareholders alike. Globally, our new operational plan will enable redeployment of the right resources to areas that promise the strongest growth, improve the speed of product to market and ultimately strengthen our leadership in the mid-market.
The outcomes of these short-term initiatives are primarily focused on the more mature European markets. In the A/NZ region our trend line is somewhat different and we fully expect to continue with current growth plans, strong customer support developments and positive financial performance -- as evidenced by a successful first half year licence revenue growth of 74 percent over 2003.
If anything, the new plan underscores that we are sharpening the focus and discipline of our business activities and R&D which will continue generating the value that our mid-market customers demand and give them the knowledge that we will be with them for the long term.
IRONSIDE: PeopleSoft's acquisition of JD Edwards has no doubt caused a few integration headaches. How has the merger of the two companies and their cultures progressed in A/NZ, and what challenges are you still overcoming?
WEBSTER: Actually, the "headaches" have been surprisingly few. A successful integration is one that happens quickly. The focus for A/NZ was to bring our people together as soon as we could (once the merger was finalised) and reach out to our customers. This has been a complementary merger and that extends to the cultures of the two companies. The integration was actually completed by November last year. The main "headache" around the integration was the FUD (fear, uncertainty, doubt) that many of our competitors tried to seed, through the media or directly to our customers. Thankfully our customers and employees saw the FUD for what it was. Just that.
WEBSTER: To finance your cuts and "restructuring" you've also announced new financing to the tune of US$50 million from Tennenbaum Capital Partners in new debt and equity. With your revenues still being problematic, how will you pay these debts?
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As such, we are now well positioned to gain significant returns from our past investments, based upon current market share and business volumes. Any such "debt" as referred to, can and will be satisfied by our balanced performance against key objectives. Potential market upturns or market share increases will simply enhance our overall financial performance. In this regard our future is very certain and we are able to manage our own destiny accordingly on behalf of all stake holders of the business.
IRONSIDE: Some press reports in A/NZ over recent months have highlighted certain troubled PeopleSoft ERP implementations and support. In your experience, what do you see as the primary reasons behind customer projects not going to plan?
WEBSTER: Over 500 businesses across A/NZ are running their mission critical systems on PeopleSoft. Key to their success is often involving us in a significant way, not only through the sales cycle but also during the scoping and implementation phases. We call it having "skin in the game". While we work closely with our partners, we encourage our customers to enable us to have a greater degree of involvement to ensure success. We've invested significantly in PeopleSoft Consulting as well as new implementation services and training to ensure our customers can lean on us wherever they need to.
WEBSTER: With your current financial status, do you feel you are at risk for a takeover, and what are you doing to protect yourself against this? Do you think the three Swedish firms -- Intentia, IFS, and IBS will become I3?
IRONSIDE: I'm surprised by this question given that PeopleSoft itself has long been the subject of a hostile takeover bid by Oracle, whilst still battling integration and customer support challenges resulting from the JD Edwards acquisition.
But, in a nutshell the answer to your question is "no". In fact, the mood within the group is such that I would even venture to suggest the contrary could be true. Intentia has a fabulous product in Movex which is both functionally rich and broad and technically one of the most advanced and modern products available today. All the hard development yards and investment in this area are behind us and a key focus for the future is simply to get it to market, thereby increasing market share.
It should also be noted that with its current investors, Intentia now has perhaps the most stable share register amongst its competitors. With this strong capital base, confidence of new investors, focused operational plan, and expanding product innovation -- illustrated by unique new launches such as Opportunity Analyzer -- Intentia is perhaps the least likely vendor in this space to be at risk.
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