Siebel's Schmaier Defends State Of CRM Market

Siebel Systems

"I call it the CRM paradox. People say between 50 [percent and 70 percent of projects fail, but our customer loyalty is high. We take this pretty seriously obviously, and we practice what we preach. Our quarterly customer satisfaction surveys show loyalty is about 98 percent. A third party asks customers if they plan to keep using Siebel and 98 percent say yes," he said.

Because CRM encompasses so many variables, it is hard to define, Schmaier added. "CRM has been trivialized ... people think of it as names and addresses but what call centers, sales and marketing people do, it's complicated. The number of users and amount of data lying around, this stuff has to really work and it's pretty hard to fool customers," he said.

Siebel shipped Siebel 7, its first Web-enabled version, late last year and Schmaier said uptake has been good, even in this down economy. More than 600 customers are deploying, and 50 to 100 of them are live, he noted.

Schmaier said business in the life sciences sector is growing fast, the energy market is doing well and even the financial services market, "is ticking back up," he said.

Adam Honig, president of Akibia Consulting, a Boston-based integrator, said he's seen a lot of interest in CRM among credit unions and health insurance providers. But a New York-based CRM integrator, who asked not to be named, said business is very soft. "There's no question Siebel's the best product so it's not that no one cares about Siebel or CRM. The truth is right now no one cares about IT products, at least when it comes to buying them," he said.

Siebel customers under maintenance contracts do not pay for the upgrades, but if they add more application modules, Siebel gets more revenue. The company has not disclosed how many new modules it has sold. With Siebel 7 the number of modules soared to 390 from 280.

Later this summer, the company plans to launch Siebel 7.5, which adds support for important Web services standards WSDL, UDDI and SOAP. "That version will offer UDDI and SOAP access to all our underlying business objects and components," Schmaier said.

He also said that Siebel's nascent Universal Application Network (UAN) could jump-start interest in new IT implementations. The idea behind UAN is to provide a standard framework for application connectors so customers with hundreds of business applications do not have to write and install thousands of point-to-point connections between them.

"Traditionally, if you have 5,000 applications, that means 5,000 squared or 25 million connections. It's an intractable problem," Schmaier said. So far, IBM, Tibco, webMethods and SeeBeyond have pledged allegiance to the effort to come up with prebuilt processes and a common object model to run atop standard integration servers. Microsoft is noticeably absent, although Schmaier said Siebel and Microsoft have discussed the effort. Other software companies such as Oracle and SAP are working on their own integration servers.