J.D. Edwards Has Eye on Federal Opportunities

J.D. Edwards Has Eye on Federal Opportunities

By Andrea Novotny
Staff Writer

The year 2000 software conversion crisis is creating an opportunity for J.D. Edwards & Co. to apply what it has learned in the state and local arena to the federal government market, company officials said.

The year 2000 problem is a major motivator for federal, state and local governments to purchase packaged software solutions, said Alan Winder, executive director of J.D. Edwards Public Services Business Unit.

The Denver-based company develops, markets and supports enterprise software that integrates procurement, financial and distribution functions and operates in multiple computing environments.

The software developer is fine-tuning plans to sell its financial and purchasing software on the General Services Administration schedule, Winder said. However, the company cannot make that move until the GSA's next solicitation, expected in September, he said.

In addition, the company plans to create a new business unit dedicated to the federal market, Winder said, equipped with a new sales team that will forge integrator

The year 2000 problem is creating the greatest potential in the public sector market for enterprise resource planning vendors, said George Gilbert, an analyst with Deutsche Morgan Grenfell Technology Group in San Francisco.

Analysts said these solutions are a strong sell to all levels of government because they are easy to implement across wide sections that want to manage from the top down and standardize across the organization.

Another benefit is that these solutions can solve year 2000 issues by replacing legacy systems.

Of the five major global competitors in the enterprise resource planning market, J.D. Edwards ranks fourth, said Byron Miller, vice president of the Giga Information Group in Cambridge, Mass.

SAP AG of Waldorf, Germany, is the market leader, followed by Oracle Corp. of Redwood Shores, Calif., and PeopleSoft Inc. of Pleasanton, Calif. Baan Co. N.V. of Putten, Netherlands, ranks fifth in the market.

J.D. Edwards has 4,300 global customers using its software, and it posted revenues of $648 million for fiscal 1997, ending Oct. 31. About 37 percent of that came from business outside the United States.

According to Gilbert, the company has a good track record of serving small and midsize customers, such as local governments, and quickly getting their systems up and running.

So far, J.D. Edwards has 150 U.S. government clients, all of which are state and local entities, said Russ LeFevre, marketing manager for the Public Services Business Unit, which includes government, utilities, education and not-for-profit customers. That unit accounted for roughly 10 percent of the company's overall revenues in the last fiscal year, he said.

In the last six months, J.D. Edwards has picked up 15 state and local government accounts, LeFevre said. Those wins include El Paso County, Colo., and the city of Santa Monica, Calif.

Also, the governments of three large metropolitan areas are replacing their legacy financial systems with J.D. Edwards OneWorld software. The city of Orlando, Fla., Washington County, Minn., and Wayne County, Mich. will use the software to integrate their accounting functions, automate financial reporting and gain year 2000 readiness, company officials said.

J.D. Edwards has benefited from decades of continual growth, analysts said. The company's fiscal 1998 revenues are expected to grow from $875 million to $972 million, Miller said, up from $648 million for fiscal 1997.

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