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PeopleSoft launches new strategy

The company debuts a new plan for moving into the lucrative market for outside management of corporate technology.

Looking for new growth areas for its enterprise applications, PeopleSoft (PSFT) today debuted a new strategy for moving into the lucrative market for outside management, or outsourcing, of corporate technology.

The company also announced two executive appointments to lead its outsourcing endeavor.

Although the Pleasanton, California-based client-server applications maker won't officially launch its outsourcing program until later this quarter, PeopleSoft today explained how the new effort will include business development and a slew of strategic alliances, as well as a new dedicated business unit for sales and services.

The company said the strategy will focus on what it considers the two segments of the market--the IT (information technology) and business process outsourcing parts. In IT outsourcing, or ITO, an organization's technology infrastructure, including hardware, software, and networks, is managed by a third party, the company said.

In business process outsourcing, or BPO, a third party manages both the IT systems and specific business functions, such as accounts receivable collection or employee benefits administration.

The new strategy will address the needs for both parts of the market through selective alliances in the outsourcing market, the company said. Executives also claim the new strategy will benefit the company's existing customers.

"PeopleSoft intends to bring new ideas and initiatives to the outsourcing market that will benefit our current and future customers," PeopleSoft's senior vice president of product strategy Aneel Bhusri said in a statement.

To lead these efforts, the company named John Haworth as director of outsourcing strategy. He will head up the business development and strategy functions of the new outsourcing business unit. He joined the company from Fidelity Investments, where he was vice president of human resources and payroll outsourcing business. In addition, Phil Hauver has been named general manager of the outsourcing business unit. Since 1991, Fauver has held a number of executive positions within PeopleSoft, including general manager of all commercial industry business units and vice president of the Southern Region sales operations.