Oracle Firings Bring Black Friday for PeopleSoft Staffers

Oracle has started sending out pink slips to 5,000 PeopleSoft and Oracle staffers as it works to consolidate the two companies' operations.

As expected, Oracle on Friday started handing out termination notices to PeopleSoft employees—as well as to some of its own workers—as it consolidates the two companies operations in the wake of the $10.3 billion buyout of its enterprise software rival.

Oracle Corp. plans to reduce the size of its combined work force to about 50,000 people, a reduction of 5,000 people that represents a 9 percent reduction of the total. During its 18-month-long takeover campaign, Oracle officials had estimated that the company would fire as many as 6,000 employees as a result of the buyout transition. Oracle will finish handing out firing notices over the next 10 days, company officials said.

Oracle officials declined to break down how many of the 5,000 people were PeopleSoft Inc. employees or how many are Oracle staffers.

However, Oracle plans to retain more than 90 percent of PeopleSofts product development and product support employees to carrying out Oracles plans for PeopleSoft customer support and product upgrades.

The retained PeopleSoft development team will finish the production and deployment of PeopleSoft version 8.9, and then begin development of the next upgrade to PeopleSoft products, version 9.0.

"By retaining the vast majority of PeopleSoft technical staff, Oracle will have the resources to deliver on the development and support commitments we have made to PeopleSoft customers over the past 18 months," Oracle CEO Larry Ellison said in a statement.

/zimages/6/28571.gifClick here to read more about Ellisons commitments to support PeopleSoft products.

Many PeopleSoft employees who didnt want to wait for the ax to fall or who didnt relish the prospect of going to work for Oracle have been aggressively circulating their resumes looking to make a soft landing at another company.

Meanwhile, direct Oracle competitors and niche companies are gleefully preparing to scoop up both refugees and layoff victims.

Sybase Inc., an Oracle competitor in the relational database and application development market located in Emeryville, Calif.—geographically between PeopleSofts Pleasanton, Calif., headquarters and Oracles Redwood City, Calif., base—has been running radio advertisements touting that it is a great place for software development professionals to work.

QAD Inc., for one, has already received between 500 and 600 resumes from former PeopleSoft/J.D. Edwards & Co. employees after running full-page recruitment ads in the San Francisco Chronicle and the Denver Post.

QAD makes enterprise applications for global manufacturing and, as such, was a JDE competitor before PeopleSoft bought that company. Indeed, Pamela Lopker, QADs founder, chairwoman and president, said JDE had a 60 percent to 70 percent overlap with QAD, given JDEs strong focus on manufacturing.

Not only is QAD willing to advertise heavily to get PeopleSoft/JDE employees on its team; the company has even gone so far as to open an office in Denver, for those who dont want to relocate to the companys Santa Barbara, Calif., headquarters. The new office opened Monday.

"Were getting quite a few calls from customers," Lopker said. "A lot of customers had bought PeopleSoft and JDE as well as maybe our product in different divisions. Were seeing a lot of opportunity to replace that now. People are saying, Now that Oracle has bought PeopleSoft, we want to standardize on QAD and get rid of our JDE systems. Were looking for people whove done service on these systems in the past and who can now bridge that relationship."

/zimages/6/28571.gifTo read more details about how Oracle closed the deal to buy out PeopleSoft, click here.

QAD is recruiting in the areas of marketing, service and sales and has just begun to put out preliminary job offers. Lopker said she expects to start seeing early acceptances next week, after people learn whether theyve received a pink slip from Oracle.

The reason employees have waited, Lopker pointed out, is to see whether theyll be able to cash in on the lucrative severance package PeopleSoft put together to keep staff onboard during the takeover battle. Anybody at the vice president level is entitled to a years worth of severance, whereas everyone else was eligible for three months, with stocks immediately vested.

"They gave out a lot of options that would immediately vest on a takeover, and they gave out a lot of severance," Lopker said. "People [were] really hoping to get laid off so they [could] get that. Its much more lucrative than what Oracle has for their employees."

Oracle has scheduled a three-hour Webcast on Tuesday to discuss in detail the buyout transition and the companys future product development and marketing strategy. Oracle co-president Charles Philips plans to discuss Oracles business strategy, competitive strengths and customer-support commitments.

Senior vice president John Wookey will discuss the organization of the merged companies along with supported product lines, the future product development roadmap and ongoing support for PeopleSoft customers and products. Ellison will close out the Webcast with a summary of Oracles plans and a question-and-answer session.

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