Oracle's Mid-Term Report Card
Posted On: 12/15/2006
Well, folks, it's mid-term time. Time for a report card on Oracle's acquisition of PeopleSoft. There hasn't been a take-over this large (or troubled) since HP bought Compaq. As far as I can tell, the only difference here is that Larry isn't about to go the way of Carly, no matter how badly things go.
Staff Retention
Let's face it – this has been a disaster. So many former PeopleSofters have left that the place bears little resemblance to the old company. I've talked to a bunch of folks, and the short story is that they were never made to feel as if they were welcome in the new company. Oracle paid $6B for PeopleSoft. What is does that amount represent? Clearly, part of it is the net present values of the future cash flows of PeopleSoft. But that doesn't get you even close to $6B. The real value of a software company (or a consulting company, for that matter) is the people you get in the deal – the folks who created those cash-flows. If you don't make them feel welcome, they will leave. And that's what they've done – in droves.
Grade: D
Customer Recognition
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