May 2, 2024

NetSuite and Workday Rivalry Carries On an Old Tech Feud

That’s how it is for Aneel Bhusri and Zachary Nelson, whose companies are in contention over the next major shift in computing. In a way, the men are reliving history.

Two decades ago, their mentors feuded, and that time, too, the dispute took place against the backdrop of a major shift in corporate computing — when customers gave up their mainframes and moved to software that relied on personal computers closely connected to a server.

Mr. Nelson, the chief executive of NetSuite, used to work for Lawrence J. Ellison, the billionaire chief executive of Oracle.

Mr. Bhusri, the co-founder of a competitor company called Workday, used to work for David Duffield, a rival of Mr. Ellison’s. Mr. Duffield is the low-profile founder of PeopleSoft, a once-powerful maker of corporate software that Oracle acquired in a bitter, 17-month hostile takeover fight.

How bitter? Oracle defeated a federal antitrust lawsuit brought by the Justice Department before it could reel in its rival. And a month after PeopleSoft was acquired, 5,000 of its 11,000 employees were laid off.

Together, NetSuite and Workday are among a growing circle of tech outfits poised to cash in on the migration to cloud computing services and perhaps elbow aside today’s corporate software giants, like Oracle and the German company SAP.

“It would be a mistake to see this as a revenge play, though other people might see it that way,” Mr. Bhusri (pronounced “Bush-ree”) said in an interview, referring to his company’s efforts to take on Oracle’s business. “PeopleSoft came in second or third. This time we can be first.”

Workday and NetSuite each have annual sales of less than $400 million, about 1 percent of what Oracle sells in software, but the stock of both companies has rocketed on expectations that they are in the heart of a market that could grow five times faster than the rest of the tech industry, according to IDC, the technology research firm.

Companies in this growing area could be acquisition targets. IDC predicts that by mid-2014 the big software makers will have spent as much as $25 billion on acquisitions as they build out their cloud services.

While the market value of Oracle and SAP both reflect about four times their annual sales, NetSuite shares trades at 20 times its sales, and Workday is valued at 40 times. Last Wednesday, Workday reported revenue for its first fiscal quarter of $91.6 million, up 61 percent from a year earlier. In its most recent quarter, which ended March 31, NetSuite also had $91.6 million in revenue, up 32 percent from the same period a year ago.

The two upstarts both deliver services — NetSuite in accounting and Workday in human resources — that perform essential business functions, and from there have broadened into other areas.

Their services perform the same functions as traditional business software to manage tasks like accounting and tracking employee benefits. But instead of selling a license to own that software, which requires the customer to install it on a server, the two companies provide access to their services over the Internet and customers pay on a subscription basis.

Mr. Bhusri, 47, and Mr. Duffield started Workday in 2005. Mr. Bhusri is chairman, and the men share the chief executive role. Mr. Bhusri, a partner at the venture capital firm Greylock Partners, is on the board of several other cloud companies.

“They are all companies in the Dave Duffield model — the good guy model, as opposed to the other guy,” Mr. Bhusri said. An open, self-effacing man, he declined to identify the “other guy,” but added, “I would be amazed if Oracle does not buy NetSuite.”

Mr. Duffield hired Mr. Bhusri at PeopleSoft. Based in Pleasanton, Calif., about 30 miles from Oracle, it was sometimes called the “People company” and was known for its casual atmosphere.

Article source: http://www.nytimes.com/2013/05/27/technology/netsuite-and-workday-rivalry-carries-on-an-old-tech-feud.html?partner=rss&emc=rss

Day Care Centers Adapt to Round-the-Clock Demands

The tranquil domestic scene plays out nightly here, not in a family home, but behind a brightly lighted storefront next to Tuffy’s auto repair, the site of a new child care center that is open 24 hours a day.

Day care is slowly becoming night care in today’s economy, as parents work ever longer days, take on second jobs and accept odd shifts to make ends meet.

“No one works Monday through Friday, 9 to 6 anymore,” said Tiffany Bickley, a cook whose 6-year-old daughter, Airalyn, recently started going to the center, ABC Me Childcare. “No one.”

About 40 percent of the American labor force now works some form of nonstandard hours, including evenings, nights, weekends and early mornings, according to Harriet B. Presser, a professor of sociology at the University of Maryland. That share is expected to grow with the projected expansion of jobs in industries like nursing, retail and food service, which tend to require after-hours work.

At the same time, working hours are less predictable than they once were. ”There’s a greater variability and irregularity of schedules,” said Lonnie Golden, a professor of economics and labor studies at Pennsylvania State University. “In surveys, more and more people are no longer able to specify a beginning or end of the workday.”

Yet for years it has been a frustrating reality for parents that child care services have failed to keep pace with the changing workday, with many centers still keeping a rigid 8 a.m. to 6 p.m. schedule. Experiments with nighttime care have come and gone over the years, but lingering ambivalence about the concept led most centers to deem it financially untenable.

“You don’t want to put your 2-year-old at a child care center at 2 a.m.” said Gina Adams, a senior fellow at the Urban Institute. “It just doesn’t feel right.”

There are some indications now that this might be changing. The National Association of Child Care Resource and Referral Agencies said it was hearing from members that providers were offering more nontraditional hours, though it added that it did not formally track the data.

While overnight care is still relatively rare, evening hours are no longer so unusual, providers say. Donna McClintock, chief operating officer for Children’s Choice Learning Centers Inc., which runs 46 employer-sponsored child care centers across the country, said that demand for nontraditional hours had grown and that centers providing care after-hours care made up a large part of the company’s recent growth. About a fifth of the company’s centers have added nontraditional hours in the past few years, she said.

Demand for nonstandard child care hours tends to be highest in sectors where employees tend to work varying schedules, like universities, hospitals and casinos.

“It’s the wave of the future,” said Roger Neugebauer, publisher of Exchange Magazine, a trade journal for the early childhood care field. “The trend is to move beyond 9 to 5 because, with the changing economy, that’s where the need is.”

In Ohio, the number of centers offering nighttime hours is up by more than 50 percent since 2003, according to the Ohio Child Care Resource and Referral Association. Centers with overnight hours have doubled and those open on weekends have quadrupled, though the absolute numbers remain small. In all, about 7 percent of Ohio’s licensed child care centers offer some form of after-hours care, said Todd Barnhouse, executive director of the association.

Brianna Smith, who runs ABC Me, said demand for such care had been strong in Elyria, a Rust Belt town that is part of Cleveland’s sprawling suburbs. And though the recession hit hard here — the median household income dropped by about 10 percent from 2006 to 2009, and unemployment rose to 11 percent in 2009 — the center decided to include all-night hours when it opened in a converted carpet and tile showroom in June.

“There’s a big need out there right now,” Ms. Smith said. “When I talk to parents, the first thing they ask is, ‘What are your hours?’ “

Now the center is busy, literally, around the clock.

Article source: http://feeds.nytimes.com/click.phdo?i=9c70ee53931c05e8086d8950414e1ad0