Storm clouds over PeopleSoft 9.1 Talent Management?

Naomi Bloom, one of the world’s thought leading HR specialists recently pulled the text of a post she wrote about PeopleSoft 9.1 Talent Management. She said:

I’ve pulled the original post while discussions are underway with Oracle to address their specific concerns about its completeness, correctness and factual basis.

I’m not going to criticize Naomi for pulling a post. I assume she was under horrendous pressure. Fortunately, the comments remain and Ahmed Limam has taken up the cudgels in comments, a follow up blog post and in starting a thread around this topic at the HR Conference LinkedIn Group. First to the comments:

This announcement is just a marketing gimmick. Oracle is deinvesting in PeopleSoft but wants to hang on its customers by giving them the impression they are getting some new functionality which is quite paltry in comparison to what Best-of-Breed Talent Management vendors offer. I will give you two recent proofs of Oracle pulling the plug on PeopleSoft as your picture illustrates quite well:

- in France, PeopleSoft’s largest market outside the US, a recent tender, the largest payroll project in memory for all central-government employees, was left to SAP and HR Access to fight about as PeopleSoft declined to participate. Why? Especially when they’ve had a French Public Sector going back to 7.5? Simply because they didn’t want to take on new commitments which they wouldn’t be able to honor, not that that was any issue in the past, but since this is a large GOVERNMENT project they felt they couldn’t do the good old trick of over-promising and under-delivering.

- HP’s announcement that it would build its own workforce planning system, rather than rely on its historical vendor PeopleSoft (see story at http://www.hreonline.com/HRE/story.jsp?storyId=374773677) makes the point further. John Renfro, one of HP’s VP for said project, said it in no uncertain terms: ” we were always hoping that that next PeopleSoft version was going to incorporate the changes that we were talking to that firm about. They rarely did.”

[My emphasis added.] On to Ahmed’s incendiary post:

PeopleSoft product updates are just marketing gimmicks, like a bone thrown to a dog, aiming at making customers buy into the myth that the product is still being enhanced until it is buried once and for all. Did you really expect that Oracle spent billions to buy a product, universally recognized as better than its own, just to continue competing with it? Of course not, the idea was to kill all competing products (others include Siebel, Hyperion et al.) thus obliging customers to migrate to Oracle’s product, EBS, rebranded as Fusion under the pretense that it is a “new” product combining the best of all its acquired product portfolio. Only customers under the influence of intoxicating substances will fail to see that under the hood of Fusion is good ole Oracle EBS code.

At the LinkedIn group there followed what for me is a familiar pattern of discussion. Some believing that HP’s announcement is public saber rattling designed to bring Oracle to heel while others are convinced that rip and replace at HP (and other places) is a viable strategy.

Over the years I have listened to many a CXO bemoan the value they get from their software supplier but continue to fork over those 15, 18, 20, 22% and higher maintenance fees. All sorts of reasons are given but I suspect that with an average tenure of less than 5 years, many take the easy way out and do nothing. In the grand scheme of things, maintenance is a relatively small piece of the IT budget pie so why rock the boat when you could be faced with yet another fraught implementation? Or at least that was the case until CIO’s found that pie shrinking while demand for more value went up. More recently I have been hearing Oracle users grumbling (what’s new) but prepared to start talking publicly about their woes. HP’s announcement is what I think may be the first of many.

Back at the LinkedIn group, one commenter said: “…unfortunately, there’s no reason for an HR or IT exec to add their true experiences in a public forum. It would be nice to hear from Oracle, Workday or any of the TM, WFP vendors. But I doubt we’ll see that either.” Exactly the opposite is happening albeit many of the arguments speak to familiar issues and perspectives. It was only after intense pressure from user groups, amplified by people like myself, Ray Wang, Tom Wailgum, Bob Evans, Frank Scavo, Vinnie Mirchandani and others that SAP finally backed off on their maintenance price hike. Could Oracle be pressured into doing the same?

When it comes to maintenance, I’m hopeful. Despite what Oracle might say about maintenance not being a matter for negotiation, they only need to see a few handfuls of high profile customers rip up their Oracle contract for them to start talking turkey. As I’ve said on many an occasion, you cannot defy gravity forever and while Oracle has had a sweet ride to date, its acquisition strategy is coming back to haunt it.

Regardless of all the fanfare around 100 days of innovation promised when Fusion middleware was launched last year, we are now almost half way through 2010 and still there is little evidence of Fusion applications. Again, that’s what happens when you bow to financial masters rather than meeting customer demands.

Finally, the LinkedIn conversation took a turn towards discussing the role of HR - or is it HCM? and again familiar arguments around whether it is strategic or otherwise emerged. The other day I talked about SuccessFactors acquiring CubeTree. Inside that story was the question of value. I can see how the combination could lead to transformative value. But only if they can get 100% adoption. And of course there’s still the problem of all those niggly integrations plus the issue of getting HR engaged in strategic roles. All that helps Oracle because there’s nothing better than a little confusion and FUD to ensure the incumbents keep receiving their entitlement checks.

The apparent firestorm Naomi set off will not die down any time soon. New voices are entering the fray and Oracle will not be able to silence them all. Ahmed is expressing what many of us have thought and providing the evidence to back up his theory. It is perhaps telling that when the post was circulated at the recent IHRIM conference by Roy Altman, CEO and founder, Peopleserv:

Some customers said they couldn’t wait for an excuse to leave Oracle/PS. Some admitted that it would be politically difficult to go SaaS and threaten IT’s fiefdom.

Again it sounds familiar but behind the straw poll, it’s all to play for out there. As we see more blockbuster announcements: SuccessFactors winning at Wal-Mart, Workday pulling in Aviva, while RiminiStreet quietly picks off more Oracle customers you have to ask - is Oracle taking notice?