Picking Up The Pieces

Pandesic's loss has turned out to be solution providers' gain.

Despite backing from the deep pockets of SAP and Intel, the ASP last summer announced it would shut down after the holiday shopping season, forcing its 100 customers to find alternative solutions for the e-business applications and hosting services they had been renting from Pandesic.

For many Pandesic customers, solution providers were there to pick up the shattered pieces, finding new homes for customers' Web operations, transitioning them to new technology, and scooping up revenue opportunities along the way.

Solution providers were quick to move in on displaced customers after the closing of Pandesic.

When eVineyard learned of Pandesic's impending demise, the timing could not have been worse, says Michael Osborn, vice president of development for eVineyard, Portland, Ore., an online wine merchant.

EVineyard's entire business rested on Pandesic. The ASP was hosting the company's Web site, front-end catalog and back-office ERP applications, he says.

"We were faced with the question: Do we put the pedal to the floor and implement the change before the holidays or in the two weeks after the holidays?" says Osborn.

EVineyard chose the former and turned to CTR, a systems integrator based in Portland that was already working with the wine merchant to implement Epicor's eFinancials, a corporate financial application.

"We just jumped on the phone and looked at expanding [our relationship]," says Osborn.

For CTR, that phone call resulted in a half-million-dollar revenue opportunity, plus an additional $150,000 in product sales, says Doug Foley, president of CTR.

	ASPs were waiting tp pick up abandoned Pandesic customers.

Pandesic's approach was too complex for a small business like eVineyard, says Foley. Instead, CTR transitioned eVineyard from the hosted solution to a traditional licensed implementation of Epicor's eDistribution, which it was able to integrate with the new Epicor financial solution.

"SAP was a very bad fit for this company. It's very complex, and it was Pandesic's business plan to mask that complexity," says Foley.

EVineyard moved its Web site hosting to Intel Online Services, tapping CTR staff to provide support during the transition, Osborn says.

The new implementation went live mid-November, just ahead of the holiday rush, says Osborn.

Aside from systems integrators, other solution providers, such as ASPs, were standing by to pick up the abandoned Pandesic customers.

EOnline, an ASP that hosts enterprise applications from vendors such as SAP, Ariba and Vignette, was able to transition online grocer SimonDelivers.com from Pandesic to its own hosted SAP implementation in about a month, says Bruce Sink, vice president of operations at eOnline, Cupertino, Calif.

The biggest challenges of the migration were mostly architectural issues, but eOnline was able to make improvements and give its new customer improved site performance, says Sink.

"We took their checkout time from 60 seconds down to 4 seconds," Sink says.

Executives from SimonDelivers.com declined to be interviewed for this article.

However, not all of Pan-desic's customers were eager to jump back onto the ASP bandwagon. The San Francisco Giants baseball team chose to move its eCRM systems, formerly hosted by Pandesic, to an in-house implementation, says Bill Schlough, vice president and CIO of the Giants.

The Pandesic debacle set the team's e-commerce efforts back about a year, Schlough says.

"This season we're not going to make any progress. The focus is to maintain what we had last year," he says. "After being burnt by Pandesic, we're a little bit gun-shy about moving on to another ASP."