Monday, January 03, 2005

PeopleSoft people await word on layoffs

According to an e-mail from Larry Ellison to PeopleSoft employees, Oracle plans to announce on January 14 who will be terminated. According to the East Bay Business Times, a local business journal, it appears that in the short term, Oracle may lay off fewer PeopleSoft employees than it originally indicated. But over the long term, the cuts could be deep.

"In the short run, I would say (Oracle officials) will be spending most of their time integrating the two companies," said Joy Bhadury, chairman of the management and finance department at Cal State Hayward's College of Business and Economics. "After saying early on he would fire almost everybody, Larry Ellison has done a 180 and promised he would keep the PeopleSoft staff intact for a period of time. But make no mistake, jobs will be gone. It's clear this is really not a merger, but a buyout. One army has indeed conquered the other. Eventually, PeopleSoft will be Oracle-ized."

Bhadury predicts that between 4,000 and 6,000 of PeopleSoft's 12,000 employees will be out of a job within a few years. Who is front and center on the chopping block?

"My feeling is PeopleSoft's senior management is gone," he said. "On the other hand, Oracle can't afford to lose the top people in all parts of the company. They do not want to lose high-performing salespeople, designers and product support personnel. Oracle will need to find the key people and keep them on board."
Where will the terminated employees land? I would expect to see some of the best picked up by other enterprise system vendors. It would not surprise me, also, to see some of them join technical services firms to provide services to the PeopleSoft installed base, or start new firms to do so. That could create some interesting competition in the market for PeopleSoft services.

Related posts
Oracle takes control of PeopleSoft
PeopleSoft CEO Duffield resigns

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