Ballmers Three Amigos - Page 2

Find a Thoroughbred Microsofts decision to lasso Great Plains comes at a critical time. Faced with a saturated PC sector, CEO Steve Ballmer knows he needs to ride herd into fast-growing markets.

Enter Great Plains, which develops HR, accounting and other apps for small and midsize businesses (SMB). Founded in 1981, Great Plains annual sales are nearing $300 million, up from $42.3 million in 1996. Microsoft hopes to build it into a $500 million-plus operation within the next few years.

Under the pending merger plan, Burgum will run Great Plains Software as a Microsoft division, which will report jointly to Microsoft group VP Jeff Raikes and senior VP David Vaskevitch.

Who has the Reins? Burgum, Raikes and Vaskevitch are getting most of the press, but sources on Wall Street say another trio—Microsoft VP Russ Stockdale, and Great Plains COO Uecker-Rust and CFO Reller—is managing much of Great Plains transformation into a Microsoft division.

"Russ [Stockdale] will be assigned to Great Plains as a business unit for the next year," says Uecker-Rust. "He has really immersed himself in the job. Hes our connection into Microsoft; hes been there 10 years, so he really knows his way around."

To be sure, Stockdale is a savvy software veteran. He was one of the core players who drove Exchange Server to the top of the messaging market. Now, Stockdale has to serve two masters: a demanding Microsoft management team that wants to dominate the SMB market, and a Great Plains division that needs to retain its top talent in order to maintain its rapid growth.

Its impossible to predict future employee turnover, but Stockdale has three factors working in his favor: CEO Burgum has been with Great Plains since day one, while COO Uecker-Rust and CFO Reller each have been on board for more than 15 years. That track record should inspire loyalty within the ranks, assuming the deal doesnt hit any major bumps.

Stockdale and his Great Plains counterparts will face close scrutiny over the next few months. From Microsoft CEO Ballmer to thousands of partners, a lot of people are counting on a successful business combo.

Just ask SEI Information Technology, a Chicago-based integrator. "Were a Microsoft partner and a Great Plains partner," says Marivel Long, director of enterprise solutions at SEI. "Were looking for Great Plains to really embrace Microsofts .Net strategy."

Under the guiding hand of Microsoft chairman and chief software architect Bill Gates, the .Net strategy will push Microsoft beyond its PC heritage to embrace wireless handhelds, Internet terminals, network appliances and other non-PC platforms.

Many Microsoft allies will examine Great Plains .Net plans during Convergence, an annual user conference that kicks off March 14 in Orlando, Fla. Burgum is expected to discuss some general plans during his keynote speech at the event. Firmer details about the business combo—including branding strategies—will likely surface in late April or early May, after Microsoft finalizes the Great Plains deal. A newly polished alliance strategy wont likely materialize until Oct. 3, when Great Plains kicks off its annual Stampede partner conference in Fargo, N.D.

To the casual observer, Great Plains is an ideal fit for Micro- soft. Burgum knows Ballmer from their days at Stanford University, and Burgum has been taking careful notes from his Microsoft counterpart ever since. Burgum bet on Windows NT and SQL Server long before most companies jumped on Microsofts server bandwagon. And Great Plains, much like Microsoft, drives virtually all of its sales through loyal channel partners. The companys flagship products include:

> Dynamics, a platform for midsize companies that includes financial, distribution, accounting, HR, payroll and fixed-asset software;

> eEnterprise, a business-management package for the midsize markets top tier. Its similar to Dynamics but much more extensive in scope, offering additional components like manufacturing applications;

> Great Plains Siebel Front Office, a CRM suite developed jointly with Siebel Systems. The suite is fully integrated with eEnterprise and Dynamics, and

> Solomon IV, a low-end suite that Great Plains acquired in mid-2000.