Oracle Purchases Primavera
As of October 2008 Primavera has been acquired by the Oracle Corporation. Pinnacle expects to see some major changes in the IT and New Product Development (NPD) markets for Primavera. Oracle has a much better standing with the IT community than Primavera has had in the past.
Oracle will give the Primavera sales force access to the IT community comparable to that of Primavera’s major competitors in that area, companies like Computer Associates, Hewlett Packard and Compuware. A great deal of the success these companies have in selling Enterprise Project Management is based upon their ongoing relationships with IT organizations and their visibility of upcoming Enterprise Project Management (EPM) initiatives in those organizations.
To date a large proportion of Primavera's sales have come from their channel partners. Their direct sales force has made a strong showing in Government and other major accounts. In IT and NPD they have not been as successful at getting into deals where Computer Associates, Hewlett Packard, Compuware and Planview are competing.
Three things have held Primavera back in this space:
1. Their lack of focus on this market. This acquisition will certainly give them access to deals that they would otherwise have not been included in. Over the years Primavera has shifted its' focus toward and away from IT / NPD several times. They will certainly keep it as a main target now. We expect Oracle’s corporate IT oriented sales teams to walk Primavera Sales Execs into many new opportunities.
2. The Primavera product faces stiff competition for the project management and resource management roles within IT and NPD. Primavera’s flagship product, P6, is built around the Critical Path Management technique to a larger extent than the products from the other major vendors. Planview and others are focused on Resource Management first and then simple task scheduling second. Many of the vendors simply use Microsoft Project as their task scheduler. CPM is seen as dogmatic and hard-to-use by many and the non-CPM options make for a more appealing approach for many in IT.
Primavera is much stronger supporting other IT and NPD roles such as Portfolio Planners and capabilities such as Time Reporting. They have first rate products in these areas that are easily accepted by the user community. Primavera also has a good number of software partners that build products providing integration with ERP and Accounting packages. This integration is almost always part of an Enterprise Project Management implementation in IT and NPD.
Primavera will still face strong competition on integrating into IT Service Management solutions. Expect Computer Associates, Planview and others to continue to lead in these areas for the near future.
3. Primavera’s consulting organization is strong on the technical side of implementing their product. Where they and most of the other vendors lag is in the Adoption, Enterprise integration, and Cultural Change aspects. Most EPM implementations do not meet the expectations of their sponsors. Typically this is due to underestimating the real changes needed to deliver on business expectations and a tendency to focus on installing the product and providing very limited training.
Pinnacle has a long history of implementing EPM solutions for IT and NPD clients. We also have a strong record of implementing Primavera products for this space. We have implemented some of the largest and most successful Primavera product implementations. We are highly optimistic that the Oracle / Primavera acquisition will be very successful.