PeopleSoft, Oracle User Groups Have Their Own Merger Issues

When PeopleSoft agreed to be acquired by Oracle, Charles Phillips put in a call to Quest, the J.D. Edwards applications user group, to assure the organization that Oracle wanted to work with the group. But by singling out Quest to contact, Oracle's president stepped into the middle of user-group issues left over from the earlier merger of J.D. Edwards and PeopleSoft. Now that the Oracle-PeopleSoft merger is imminent, a new fire has been lit under a pot that was already simmering.

PeopleSoft acquired J.D. Edwards 20 months before PeopleSoft agreed to be acquired by Oracle, and Phillips decided Quest was a key constituency to contact. He told Quest's board of directors that it represented the "unified voice" of J.D. Edwards users.

But not the only voice. J.D. Edwards actually had a two-tier user-group system, with local groups planning meetings and raising technical issues and Quest organizing the annual user-group conference in Denver.

PeopleSoft, which had regional user groups, was more comfortable with the local J.D. Edwards units. In a rift with Quest, PeopleSoft announced that it couldn't manage relationships with a national organization as well as the regional groups.

"PeopleSoft didn't want to have anything to do with Quest. Quest was very much de-emphasized," says Robert Robinson, business-systems supervisor of Durr Industries and a member of the now-merged board of directors of the PeopleSoft and J. D. Edwards Big Ten Regional User Group, which covers Michigan, Indiana, and Ohio.

But, despite being spurned by PeopleSoft, Quest refused to go away and its leaders told PeopleSoft that the company should get used to an independent user body like itself, says Fred Pond, president of Quest and IS director at Schnitzer Steel Industries Inc. in Portland, Ore.

Since that time, the local J. D. Edwards user groups and regional PeopleSoft groups began to merge, while Quest continued to operate at the national level. And now Phillips has walked into the middle of that dispute.

"I saw [that Oracle] had been in touch with Quest. I think they're going about it the wrong way," says Barry Bugal, former president of the Northern California J.D. Edwards User Group, now VP of the PeopleSoft Northern California Regional Users Group, which resulted from the merger of a J.D. Edwards local group and a PeopleSoft regional group.

Glenn Marfell, president of the Northern California group and manager of human-resource systems for Fujitsu America, says he's received no overtures from Oracle. But he thinks it "would be great if Larry Ellison came to our March meeting," he says. Despite the merger, the group is moving forward with plans for a meeting, even though it represents a $25,000-$30,000 commitment for hotel meeting rooms and meals.

Phillips may have decided to call Quest because the group contacted him shortly after Oracle said it wanted to buy PeopleSoft. Pond says Quest invited both Phillips and PeopleSoft's Craig Conway to address the group. Phillips accepted and Conway declined. Quest still has 2,000 companies as members. According to Pond's account of the post-agreement contact with Phillips posted here , Oracle has agreed to work through Quest to establish contact with J. D. Edwards users. "We'd love to work with Oracle and help with this transition," Pond says. "We may take the lead. We have to reach the people very quickly. We might be a good conduit to do that."

If J.D. Edwards, PeopleSoft and the existing Oracle Applications User Group were to form a unified front, they would represent a potentially powerful user entity. Patricia Dues, Oracle applications user group president, says the Oracle group has a support council that meets with Oracle representatives once a month to raise support issues. With PeopleSoft representation, such a council could act as a watchdog on Oracle's commitment to bring out the next generation of PeopleSoft applications and the level of support that it continues to provide for the PeopleSoft product line. But it's not clear that a unified group can emerge for some time yet.

Dues says the prospect of the merger is "exciting" and she is looking forward to the boost in membership that J. D. Edwards and PeopleSoft users will bring to the Oracle user group. "We think it will be nice to have them come into our membership," she said.

But Durr Industries' Robinson says PeopleSoft users will remain a distinct constituency within the Oracle customer base for some time and may want a user group organizational structure that reflects their interests. After all, some of them are former J. D. Edwards application users and J. D. Edwards drilled the slogan, "Software that endures," into their outlook.

But in the long run, he thinks they'll get together. "Larry Ellison's personality aside," he says, "the possibility of a merged product line taking the software some place where it wouldn't have gone--that's exciting."