It's never easy being a user of a legacy application when it changes hands from one company to another, bringing with it worries about continued support and service.
But this week's sale of three InterBiz product lines to SSA Global Technologies Inc. by Computer Associates International Inc. in Islandia, N.Y., could bring real enterprise resource planning (ERP) benefits, according to several customers and analysts.
Warren Smith, IT director for the Victor Reinz division of Toledo, Ohio-based Dana Corp., called it a good move because CA "has had trouble focusing on its traditional product line," while trying to maintain InterBiz, its 3-year-old e-business applications division.
"I think it was a difficulty in understanding how wide and encompassing an ERP system must be," as well as having the necessary knowledge to support and sell it, Smith said.
Smith, who is also president of San Jose-based CAMUS International Inc., a manufacturing applications user group, said his vehicle engine components division has been using the legacy ERP products since 1986, long before CA bought them in a host of acquisition deals. The sale to Chicago-based SSA "will be a good thing for us," he said. "It says a lot, too, that the products have some value."
Several analysts said the InterBiz applications never really fit with CA's overall strategy or product lines. The products SSA bought include InterBiz Online, InterBiz Reports, KBM, MANMAN, Masterpiece/Net, HRMS, MK Manufacturing, PRMS and MAXCIM.
"They'll be a substantial part of SSA's business going forward," said Bob Anderson, an analyst at Stamford, Conn.-based Gartner Inc. "They were kind of on the back burner with CA."
Anderson said the deal will likely ensure continued support and product enhancements for users from SSA, which appears to be committed to ERP applications. "I think in the end it just got old for CA," he said.
Valerie O'Connell, an analyst at Aberdeen Group Inc. in Boston, said CA's InterBiz endeavor was "classic CA," with good features and people but with products that had very different sales cycles from their normal business. "So even though there was a lot of terrific technology ... it was very difficult to rationalize interBiz with the rest of the company," she said. "It was like having a great piece of furniture, but it doesn't go with anything else."
Another user, Andrew Winer, CIO of plastic and rubber goods manufacturer Myers Industries Inc. in Akron, Ohio, said his company has been using PRMS and MasterPiece for more than 10 years, as well as InterBiz Online. "I'm not particularly worried about the products," Winer said. What will make him feel more comfortable, he said, is to talk face to face with SSA leaders to be sure that they will stay behind the products.
Mike Greenough, CEO of Chicago-based SSA, said the acquisition of the product lines from CA is further evidence of his company's commitment to the ERP market and these legacy applications. "We are very clear," Greenough said. "We're going to extend the life of their investments."
The terms of the deal with CA haven't been disclosed. About 725 InterBiz employees are part of the sale, but about 40 percent of those workers, or some 325, will lose their jobs by the end of May due to overlap with SSA, Greenough said. Additional ERP acquisitions are likely during the next 18 months, he said, as the company continues to extend its offerings in the marketplace.
A spokesman for CA said that the sale of the three product lines to SSA still leaves the company with the InterBiz banking applications and its BizWorks application platform, which will now be rolled into CA's e-business division.
Sanjay Kumar, CA's president and CEO, couldn't be reached for comment. But in a February interview with Computerworld Kumar said that while the InterBiz applications "are good products and there is some interesting technology," his company was looking to partner with another company to boost its presence in the market.
In April 2000, SSA, formerly known as System Software Associates Inc., filed for Chapter 11 bankruptcy. It was later acquired by New York investment firm Cerberus Capital Management LP and after the bankruptcy began a string of new acquisitions to gain customers and products.