It all comes down to the big TOE. Thats what PeopleSoft CEO Craig Conway says, anyway. Conways TOE is the "total ownership experience," a fuzzy concept that Conway made a big fuss over at the recent PeopleSoft Leadership Summit in Las Vegas. Conway said TOE was as important an announcement as the unveiling of the PeopleSoft Internet Architecture, which three years ago was a bet-the-company strategy.
The TOE announcement obscured what would have been huge news: PeopleSoft adopting Linux as a deployment platform with 170 PeopleSoft applications scheduled to be rolled out by years end. That would have been a good bet-the-company strategy. It would also have kicked sand in Microsofts face in retribution for its encroaching on the business applications market.
Whats TOE really about? To PeopleSoft, TOE equals quality. So, one might think, stressing TOE now must mean PeopleSoft had poor quality in the past.
There are plenty of reports about universities, businesses and other institutions that were ravaged by poorly planned PeopleSoft implementations, but many of these were the fault of integrators, who failed to grasp the complexity of the organizations business processes and accurately capture the business metrics to put them into a rigid software system such as PeopleSoft. The deployments, some of which have taken, scandalously, five years or more, had nothing to do with the quality of the software.
With TOE, PeopleSoft has outlined three areas to address failed implementations: easier installation of the system, more efficient maintenance and improving the overall experience of the application. While these are admirable goals, they are impossible for PeopleSoft to completely address itself, since the company cant fix its applications unless it fixes how businesses are run in the first place.
Conway frequently compares his industry with the auto industry in the 1970s, when Japanese carmakers made big strides in the U.S. market. "Toyota didnt sell more cars because of better designs," but Toyota sold more because they had better quality, he said. Back then, the Japanese carmakers began adopting something called TQM (Total Quality Management), itself an American concept rejected outright by most American companies. The role of TQM, which I had to study as a government contractor in the late 1980s and early 1990s, was to create a system for continuous improvement. Part of TQM was based on technological improvements, part of it was defining a structure and part of it was to boost company morale. TQM itself was a somewhat amorphous concept, which is why it didnt fly in the United States. TOE is PeopleSofts version of TQM.
But the auto industry and business applications are as opposite as you can get. The auto industry never had to worry about what its customers thought of quick implementations, complex business processes and return on investment. The business problem of auto consumers is outrageously simple: They need cars to get from one place to another. TQM is a solution to manufacturing problems, which is something that PeopleSoft doesnt have to worry about.
Since quality is really not the issue and implementation is, TOE is, I fear, simply a corporate digression away from the technologies that are still needed in packaged applications. What PeopleSoft does need to worry about is how to boost the technology in its core products without lumping on features. It also needs to pay attention to lowering the cost of its goods.
Analytics are another issue. While its true that PeopleSoft has something slightly better than a reporting solution in most of its product line, wheres the predictive modeling? Where are the deep analytics provided by vendors such as SAS or even E.piphany? Does PeopleSoft have any concept of real-time geospatial analytics that can give customers better insight into customer and supplier demographics?
There are other gaps. Why isnt there a better way to upgrade from PeopleSoft applications that have been heavily customized? PeopleSoft should be concentrating on fleshing out the technology it claims to already have. And yet the first demonstrations of TOE showed only minor changes, such as saving a mouse click to add a new customer record.
Thats not enough. The market is not that mature. Conway needs to change his bets from fuzzy concepts to hard technology.
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