Is there more to PeopleSoft than internet-everything?

PeopleSoft has had some major ups and downs all in a very short space of time. Kate Hanaghan recently caught up with them and found there's more to its resurgence than a good slogan - just ask its rivals and analysts.

Nobody can deny the value of a good, distinct marketing catchphrase. Let's face it, it can really be the making of a company. Take PeopleSoft. Two years ago it was floundering - the new kid in town faced with the daunting task of competing with the likes of Oracle and Siebel.

It then took two very important decisions. It made all of its products accessible only by a good browser and coined a marketing phrase to highlight this differentiator. And so 'No code on the client' was born.

Two years on, what's the company achieved? Not everyone can continue to get all excited by 'No code on the client'. Don't get me wrong. 'No code on the client' has worked very well. It's raised the company's profile and given it a unique identity. The problem is, everyone's a bit bored of hearing it and there is a sense the company is not too customer-friendly. After all, it's hardly L'Oreal's 'Because I'm worth it', or that confectionary classic, "A Mars a day helps you work, rest and play".

On top of that, things have moved on and its internet architecture is not the differentiator it once was. Nevertheless, PeopleSoft is sticking to its guns. The company's CTO, Rick Berquist, told silicon.com: "I expect SAP and Oracle will come up with a solution - but we have traction in the marketplace. We have a good architecture and this distinguishes us."

Along with 'No code on the client' - which incidentally the CEO even had his children recite for the purposes of a recent user conference - PeopleSoft is making a number of claims.

At the user conference in Nice, there was lots of talk of ESA (that's Enterprise Service Automation to the uninitiated). Not a new concept in itself but certainly something the company is trying to gain some ownership of.

PeopleSoft has products ranging from good old-fashioned financials, CRM and HR to e-procurement and supply chain analytical software - all browser-based. Two questions: do we need another acronym, and is ESA actually anything more than a re-packaging of existing PeopleSoft products?

CTO Berquist admitted there is overlap going on. "In the software industry, you're getting more and more re-use of components," he said. However, he justifies ESA as a new product because it targets a different market and buyer compared with its HR and financial offerings.

Andrew Ball, an analyst with Frost and Sullivan, agrees with Berquist: "It's very difficult to differentiate yourself in enterprise software. I recognise the strength of PeopleSoft's 'No code on the client' message." However, he added, it is one "analysts are more excited about than customers".

PeopleSoft has recently been joined by Ariba in the enterprise software sector. Ariba is so closely associated with the boom and bust of the B2B bubble it has decided it is now a 'spend management' company. As such, PeopleSoft - not Commerce One - is now one of its most important competitors.

Steve Muddiman, Ariba VP marketing EMEA, raises a similar point to analyst Ball by questioning how customer-friendly the marketing spin is. He said: "I have to question what ['No code on the client'] means. If I don't understand it, it's unlikely that the customer will."

Maybe. Or maybe this says more about Ariba's understanding of the market. Although PeopleSoft might be reluctant to admit it, the company is in fact following one of its great arch-rivals. Frost and Sullivan's Ball said: "PeopleSoft has picked up Oracle's trick of a clear marketing message."

Only now, the message is tired.

Colin Addison, ebusiness marketing manager at Oracle, said: "It's an old message and we've responded to it a number of times. PeopleSoft is not our toughest competitor."

He added: "In 1999 PeopleSoft had a near death experience and then came blazing back with its 100 per cent internet architecture. Oracle has had internet-based applications since 1998."

PeopleSoft has sung its own praises on many occasions as being a company that took the informed gamble to make the complete shift to an internet architecture. But Oracle's Addison isn't convinced. He describes PeopleSoft's decision to go 100 per cent internet as not a gamble in terms of the technology but a gamble to save the business.

Analyst Ball believes the company presents "an exaggeration of the benefits of its internet architecture" and that "ease of use isn't all it should be".

Maybe when the 'No code on the client' message was initially put together there was a genuine two-year gap. But as Martin Atherton, an analyst at Datamonitor, puts it: "In terms of the platform, there isn't a two-year gap anymore."

But all this said, the company is still in business and doing nicely. It has $1.4bn cash in the bank and plans to focus on profitability rather than raw growth.

In the meantime, continue to enjoy 'No code on the client'. Why? Because you're worth it!