IBM-PeopleSoft Deal Opens Door to Linux CRM

The dynamic duo of IBM and PeopleSoft has launched an initiative that the two companies say will expand their existing alliance, allowing them to focus more sharply on small and mid-size businesses (SMBs) worldwide. The alliance calls for joint hardware and software development of vertical applications, joint marketing efforts, cooperative Linux development and industry-specific solutions for resellers.

IBM’s infrastructure and service offerings are a great match with PeopleSoft’s products from both an industry and an architecture perspective, Aberdeen Group vice president of supply side research Chris Selland told CRM Buyer. “The move makes a lot of sense,” he said.

Grooming the Channel

The new initiative will let PeopleSoft leverage IBM’s massive sales channel by quickly adding hundreds of resellers to its channel efforts. The two companies plan to deliver mutually developed, pre-integrated hardware, software and services through regional solution providers.

The agreement also includes joint marketing activities aimed at boosting IBM’s presence in the SMB market, IBM spokesperson Michael Maloney said in an interview with CRM Buyer. “Today, IBM has only a handful of qualified resellers of PeopleSoft products,” he said. “We are currently defining the criteria and skill sets to select the right resellers and grow the program over the next 60 days.”

Mutual marketing projects will include joint advertising to position and promote channel partners, plus joint cooperative marketing to drive combined PeopleSoft and IBM solutions into the channel, including local markets. The duo plans on tapping IBM’s Small and Medium Business Advantage program to provide sales incentives, marketing tools and resources, training and demonstration capabilities to SMB channel partners.

Automotive First

Additionally, through the new channel relationship, the two companies announced an offering based on PeopleSoft’s EnterpriseOne applications running on IBM eServer xSeries technology for Tier 2 and Tier 3 automotive suppliers. That offering includes preintegrated IBM middleware and uses best practices from IBM consulting.

This vertical solution is intended to help move automotive companies toward demand-driven manufacturing — the ability to deliver any product, in any configuration, at any quantity, to meet customer demand at substantially lower cost to the manufacturer. The ultimate goal is to drive the highest levels of profitability.

The effort may have synergy with other PeopleSoft initiatives. Steve Trotta, a software industry analyst at Technology Business Research, explained to CRM Buyer that PeopleSoft acquired J.D. Edwards last year to capitalize on mid-market opportunities and to improve its product functionality. Now, the IBM alliance positions PeopleSoft to reap some of the benefits of that acquisition. He also anticipates PeopleSoft will gain market share through the new IBM alliance.

Linux Collaboration

Going forward, PeopleSoft may even be considering a move toward Linux. In March, the company announced that EnterpriseOne would support Linux for its Human Capital Management, Supply Chain Management, Supplier Relationship Management, Financial Management, Asset Lifecycle Management and Project Management products.

PeopleSoft claims EnterpriseOne Linux can reduce its customers’ total cost of ownership by providing an open-source, secure and stable operating system.

The new agreement strengthens the trend toward alternative operating systems for CRM. IBM spokesperson Maloney said Linux testing for a variety of Linux server configurations on the IBM eServer xSeries is imminent and will include hardware optimization, configuration and performance testing to ensure resellers have a complete solution to sell.

IBM and PeopleSoft also plan to conduct joint marketing efforts highlighting EnterpriseOne, DB2, WebSphere and IBM eServer xSeries on Linux, initially concentrating on the Asia-Pacific region and Europe.