Being JD Edwards acquisition touted a success, PeopleSofts third quarter results announced in late October showed that, excluding the impact of purchase accounting from the company’s acquisition of JD Edwards, it posted a profit of only $0.17 per share, six cents above analyst expectations. With costs of the J.D. Edwards acquisition included, PeopleSoft posted a net loss of 2 cents per share.
But despite this enthusiasm, Gartner has warned prospective and existing customers to look beyond the immediate results and added that there are problems ahead. Once integration is complete, the combined company must set a course to deliver revenue it would not have achieved as separate entities, it warns in a research note to clients.
This work has just begun. Therefore, customers should look to future quarters and to PeopleSoft’s success upselling and cross-selling products across the combined customer base as well as bringing in new accounts that would not have come its way without the acquisition.
Gartner pounces two challenges for the success of this takeover: making the product road map real and creating an effective combined sales organisation. Gartner explains: Customers should measure strategies against the PeopleSoft product and technology road map. Each buying situation will be different, but Gartner continues to advise customers to reference each other and Gartner often to ensure that they understand the long-term effects of decisions and make adequate planning for changes.