SSA Layoff Plans

The following is from Midrange Computing "Monday Morning AS/400 Update"
newsletter dated 6/28/99 written by Timothy Prickett Morgan, Editor:


SSA to Restructure; 
Staff Reductions of 15 to 20 Percent Imminent
======================================


AS/400 enterprise resource planning (ERP) software house Systems Software
Associates (SSA) is planning to restructure itself once again and will take
an unknown charge during its third quarter ended July 31 to give pink slips
to 15 to 20 percent of its current staff of 2,000 employees. SSA, which has
about 6,500 customers worldwide, is in the middle of several transitions and
consolidations. 
First, it is trying to get its existing installed base of Business Planning
and Control System (BPCS), who mostly run on AS/400s, to upgrade to its new
Internet-enabled eBPCS suite, which runs on AS/400s and Hewlett-Packard 9000
Series UNIX servers. (BPCS support for IBM's AIX and Sun Microsystems'
Solaris UNIX variants was withdrawn earlier this year.) Second, it is
working with Hewlett-Packard to develop a version of eBPCS that is supposed
to ship during the third quarter. SSA laid off 12 percent of its workforce
last July-about 270 employees-and took a restructuring charge of $120
million. SSA hasn't said what the restructuring will cost this time around.
Taking the steps to dismiss 300 to 400 of its employees and take a hit on
its books was undoubtedly a hard step for SSA to take. All ERP vendors are
hopeful about an uptick in software sales in the second half of the year as
Y2K bugs get squashed, but SSA is especially hopeful as it plans to deliver
its first Windows NT suite. That SSA decided to act now suggests that
software license sales have fallen faster in the company's third fiscal
quarter than in the second quarter ended in April, and that services
revenues are also drying up. In the second quarter, SSA reported software
license fees were down 43 percent to $28.3 million and that services
revenues were up only 11 percent to $58.4 million, for an aggregate of $86.7
million. That overall revenue was down 15 percent from the $102.4 million
SSA brought in last year. Things were not so bad during SSA's first quarter
ended in January, when license revenues were down 48 percent, but services
revenues were up 52 percent compared to the prior year and overall revenues
were only down by 9 percent.
Separately, SSA says that it has certified Bloomfield Computing Systems, an
HP and Baan business partner from Bloomfield Hills, Michigan, as a certified
eBPCS partner for HP UNIX servers. SSA also says that SSA South East and
Janis Group, Inc. (JGI), two of its prominent AS/400 eBPCS business
partners, have been certified to push HP UNIX versions of eBPCS as well.
Although no one is saying at the moment, presumably all three will be
pushing NT versions of eBPCS as soon as they become available, too.


Dilbert's Words Of Wisdom:
"I love deadlines.  I especially like the whooshing sound they make as they
go flying by."

Dennis Munro    
Badger Mining Corporation
dmunro@badgerminingcorp.com <mailto:dmunro@badgerminingcorp.com> 

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