The Four Hundred

As J.D. Edwards & Company prepares to wind up its fiscal year, the enterprise software giant last week announced a management reorganization plan that, among other things, puts the vice president in charge of WorldSoftware, Dave Siebert, in a direct line of communication with the company president, CEO, and chairman, Bob Dutkowsky. WorldSoftware is JDE's enterprise resource planning solution specifically designed for iSeries and AS/400 customers, a market segment that makes up a substantial portion of JDE's installed base.

Approximately 4,200 of JDE's 6,500 customers run in the OS/400 environment. The majority of those customers use WorldSoftware. In comparison, relatively few use OneWorld, which runs on OS/400, Windows, and Unix machines and is Java- and HTML-enabled, and fewer still use the newest offering, J.D. Edwards 5, a family of modular, integrated, Web-enabled applications.

Along with Siebert, nine other high-level executives report directly to Dutkowsky. Before the reorganization, these executives were under the command of the company's chief operating officer, Hank Bonde, whose position was eliminated. Bonde remains on the payroll in an advisory position until December 31. Bonde joined the company in February 2001, when JDE founder Ed McVaney was still in the CEO chair, which leads to some speculation that he was ousted because Dutkowsky is building a management team with his own hand-picked players.

Sources at JDE say this is not the case, and that the company has simply eliminated a layer of senior management and streamlined key executive reporting lines. Reports following the JDE acquisition of CRM software company YouCentric and SCM vendor Numetrix have indicated that JDE was wrestling with a management surplus.

The majority of the senior management team, company sources say, has been in place for 18 months. They say this is a team that has been recently assembled to address the current needs of the marketplace.

"Consolidating the management team under this reporting structure makes J.D. Edwards more effective on multiple levels," Dutkowsky said in a prepared statement. "We are now better equipped to identify and exploit opportunities in our target markets. We will realize tighter alignment among sales, services, marketing, product management, and software engineering. These changes improve the vital connections between our Americas and international organizations, our corporate and field activities, and the management team and employees, to deliver on customer and partner expectations."

It is expected that iSeries customers running J.D. Edwards 5 and OneWorld will see a more noticeable presence from the development, sales, and product marketing realignment. But JDE insists that all iSeries customers will benefit from improved communications between "what's happening in the field and what's happening in the factory."

If the company's expectations for itself are to be better attuned to the needs of its target markets and to ensure a stronger focus on serving customer needs, it is counting on its field service and support personnel to deliver the message to the development process people. Customers are counting on development to follow through.

To this end, all research and development activities in the area of software engineering have been aligned under a single operational unit. According to a company statement, this unit will focus on delivering J.D. Edwards 5, which includes enterprise resource planning, supply chain management, customer relationship management, supplier relationship management, business intelligence, collaboration and integration, and tools and technology.

The iSeries is the sweet spot for JDE applications. Both IBM and JDE are hot to do more with the midmarket, where smaller IT staffs and fewer resources (compared with large enterprises) are the norm. Both companies are counting on the iSeries to play an important role in adding greater functionality while integrating applications across the supply chain. The key is not pricing the hardware, software, and services that go into building a complete solution beyond the means of midmarket companies. Companies in the midmarket need latest level of functionality--integration across the supply chain, CRM, and ERP--just like big enterprises, but they don't usually have the enterprise-class budgets. J.D. Edwards 5, says the company, is designed with these midmarket customers in mind, and makes its functionality available in small chunks that allow midrange customers to start small and grow as their business requires or can afford.

On a separate note, JDE will report its fiscal 2002 financial results on December 3.