PeopleSoft Aligns With IBM and i-flex

PeopleSoft (Pleasanton, Calif.) has entered into a five-year, non-exclusive agreement with IBM (Armonk, N.Y.), and a partnership with i-flex solutions (New York and Mumbai), which is also an IBM business partner.

PeopleSoft has almost 1,000 customers in financial services, with 600 in banking and capital markets and 400 in insurance, according to Jim Gahagan, PeopleSoft's vice president and global executive for financial services. "The lead implementor for most of our solutions in financial services has been IBM," Gahagan says. "In all of the major institutions that we're in, IBM has a strong footprint already."

Building on that relationship, the latest deal has three main components. First, PeopleSoft will standardize on IBM WebSphere. "We've committed to use the IBM middleware and actually will include the IBM middleware as part of our solutions," Gahagan relates. Previously, one of PeopleSoft's major middleware providers had been BEA Systems (San Jose, Calif.). Now, IBM may get the nod for PeopleSoft's new customers, as well as the chance to unseat BEA among some of PeopleSoft's existing customers.

Next, the two companies will work together to develop a "risk and compliance dashboard" for Basel II, Gahagan notes. Finally, the companies will undertake joint sales and marketing efforts, giving each partner entree into the other's customer base.

Along those lines, the partnership between PeopleSoft and i-flex solutions will allow PeopleSoft to offer a core banking solution to its customers without having to build one itself. "Large organizations are really starting to focus on what to do about the legacy technologies in place today for core banking technology," says Gahagan. "We will be working with i-flex and our common customers to build out an integration between the Flexcube suite of products and our financial product line."

With PeopleSoft's executive suite in transition, and the company the target of a hostile bid and a lawsuit by Oracle (Redwood Shores, Calif.), these partnerships may be a sign of stability. Nevertheless, if PeopleSoft does increase its strategic position in financial services and elsewhere, it may become an even more valuable target for Oracle, which competes with IBM in the database and middleware categories.