A group of beta testers that includes some of the home building industry's leading names is beginning to see the fruits of its work with J.D. Edwards to develop the Homebuilder Management module. That module is the final and critical component of the software maker's enterprise, resource, and planning (ERP) system for builders.
Coupled with a new sales front end, J.D. Edwards' CRM (customer relationship management) system, large builders say they are finally within reach of a fully integrated system that's designed to scale across multiple geographic locations and users.
Whether Edwards and builders would reach that milestone, however, was suddenly thrown into doubt when Oracle, the software giant, announced a hostile takeover of PeopleSoft within weeks of PeopleSoft's announcement to merge with J.D. Edwards. At press time, Oracle was still pursuing its $7.5 billion hostile takeover bid of PeopleSoft, but its chances of success remained slim, according to industry analysts.
Now that J.D. Edwards appears set to merge with PeopleSoft, builders are crossing their fingers that Edwards' focus on the home building market and its Homebuilder Management module can continue.
Tak Fujii, CIO at The Olson Co., in Seal Beach, Calif., and one of the group of builders involved in the tests, says it's been business as usual since news of the PeopleSoft/Edwards merger and the subsequent hostile takeover bid by Oracle Corp. broke in June.
"A deal with PeopleSoft makes sense for Edwards users, because companies like Olson can retain their investment in the product and PeopleSoft wants to integrate the best-of-breed from both lines," Fujii says.
That level of cooperation would be excellent news for some of the larger builders that depend on Edwards, many of which are anxious to start moving forward after all the turmoil a couple of years back when BuildNet failed and was ultimately spun back to Edwards.
"There's been a kind of stagnation," says John Nygard, CIO at Lennar Corp., who along with managers from D.R. Horton, MBK Homes, and The Olson Co., worked with Edwards on Homebuilder Management.
"If you look at it, there haven't been a lot of good products coming to market," he says. "When BuildNet went through its phase, it bought up all its competitors, so there's been little innovation."
Builders can use Homebuilder Management and J.D. Edwards CRM to manage every aspect of the construction process: from home site inventory, buyer sales information, construction status and stages, and plan configurations, all the way through options selection, financials, job costing, contracts management, and automated purchasing and billing. The software runs over a Windows interface or a Web browser; some builders opt for one or the other and others run both.
"With Homebuilder Management and the CRM pieces out the door we can take this in a lot of different directions," says Peter Hill, director of operations for project and service industries at Edwards. "There really had been some stagnation for a few years, but now [with the combined resources of J.D. Edwards and PeopleSoft] we can pick up the pace with supply chain planning and business intelligence."
Nygard says one big plus of Homebuilder Management is that Edwards built in some new data conversion utilities that let Lennar acquire a company and integrate the new operation much faster than in the past. The new system lets Lennar convert data from most of the main builder systems, including Timberline, NewStar, BudgetTrac, Excel, Fast, Trueline, and Lloyds.
"Last year we acquired nine companies," says Nygard. "The new tool set lets us export the data, format it for Lennar's purposes, and put in back into Edwards. We now have a 90-day conversion cycle for division-level acquisitions."
Nygard says that under the old system he'd have to run a report to get a sense of what the home would look like. "Now, it's all interactive," Nygard says. "I can see on a Workbench what the home will look like. And, if I want a contracting management viewpoint, I don't have to run another process to get that information."
For The Olson Company, which is shooting for 700 homes and about $200 million in sales this year, one of the most important features of Homebuilder Management is that it will make training easier.
"People come out of school and they are used to Windows and the Web," says Scott Homan, Olson's CFO. "You sit them down in front of a green screen and they wince, they get sort of hostile to the process. With the new system, we can get temps out of the temp agencies and they are all using the product because it seems natural."
Homan says Olson signed on with Edwards about three years ago -- just before Olson planned to go on a rapid growth spurt.
"We didn't want to convert to a new software program while we were rapidly growing," says Homan. "We were on a green screen application for our Homebuilder operations and a graphical interface for our financials, accounts payable, report writing, and escrow applications. By upgrading to a much more Windows-like interface for Homebuilder, it allows for a more streamlined process."
Homan says Olson's branch locations use Homebuilder Management over a Web interface, which let the company quickly deploy the software to remote sites without adding a lot of extra T1 lines. Some of the other features that Homan likes are that Homebuilder Management lets Olson manage documents more efficiently. Printing out reports is easier, and employees can e-mail the reports as PDFs or Excel spreadsheets, as well as attach plans and other documents -- such as sales contracts -- and send them across the corporate network via e-mail.
Olson's Fujii says the company used to run four or five different systems before it migrated to Edwards. There were separate systems for job costing, sales, and scheduling, for example, and integrating the systems took a lot of manual work.
"Edwards allows us to integrate faster in a cohesive manner without the customization that would have been necessary in the past," says Fujii. "Edwards is a reliable partner, they are financially viable, and they have the home building products that are fully supported and actively developed. Another big plus is that their systems are designed for large production builders and can be distributed across several geographic areas."