Siebel Exec: Turning on a Dime
By Erika Morphy
CRMDaily.com
February 22, 2002
'We are always looking at the competition, but we don't believe they are in the same marketplace as us. We are providing sophisticated industry solutions, and - we believe - they are still struggling with a generic CRM product,' Siebel senior VP Ed Abbo told CRMDaily.
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Many enterprise software industry observers credit Siebel Systems (Nasdaq: SEBL) with creating the CRM marketplace.
Siebel's original incarnation was as a sales force automation (SFA) vendor. By 1996, the company had become a major player in that arena and recognized that there was an adjacent space in the call-center industry. Siebel then acquired call-center automation company Scopus, and the rest, as they say, is history.
"The space began to change, and it was our ability to track this change that was the turning point," said Ed Abbo, Siebel senior vice president of industry applications.
In an exclusive interview with CRMDaily.com, Abbo discussed his company's role in the evolution of customer relationship management -- and what is next for Siebel.
Strategy in Motion
An early jump into the market is only one of the reasons why Siebel is now at the top of its field. Two other strong points are the company's "partner ecosystem" and its focus on the core values of customer service, according to Abbo.
Louis Columbus, senior analyst with AMR Research, told CRMDaily that Siebel's place in the CRM industry is justified not only from an execution standpoint, but also because the company got quick control over its costs and kept moving forward.
"We had planned to double our revenues in 2001, but we realized midway through the first quarter that it wouldn't happen," Abbo said.
To respond to the change in circumstances, Siebel used enterprise resource management (ERM) to revise its business strategy for more moderate growth. The company had incorporated an employee productivity app, originally deployed internally, into its ERM suite.
"We developed this in response to surveys from employees who said they weren't receiving adequate training or feedback," Abbo explained. "The system we developed for them did a number of things, such as help them set objectives every quarter and get reviews on the objectives they had posted previously."
Since then, Abbo continued, ERM has become an integral part of Siebel's business plan. "It allows us to turn on a dime to address any objectives we want to establish."
When the quarter concluded, Siebel had met the newly projected revenue and expense levels.
The Siebel executives "deserve credit for how swiftly they reacted to the slow economy," Columbus said.
Vertical Advantage
Another reason Siebel is on top is the company's broad array of industry-specific applications.
Siebel added seven industries with its release of Siebel 7, namely, wireless communications, media, oil and gas, medical products, chemicals, retail, and travel and hospitality. It also enhanced existing applications for the financial services, communications, energy, life sciences, consumer goods, industrial and public sectors.
To be sure, a number of CRM vendors are moving into the vertical applications market. However, they do not come close to what Siebel offers, Joanie Rufo, research director for AMR Research, told CRMDaily.
Abbo said that Siebel is not looking at developing new verticals. "At this point, we are focusing on the 20 products that already exist."
Priorities In Order
One of the vertical apps that Siebel plans to develop further is its public sector offering.
Siebel's latest enhancement to its eGovernment application includes a heavy focus on homeland security, which is now a priority around the world.
Industry-specific applications "will continue to be a significant differentiator for us in the marketplace," Abbo said. "We are at least three to five years ahead of the competition."
Gaining on Siebel
Some observers, though, are starting to wonder how long Siebel can maintain its lead.
"SAP, for example, has a very deliberate design on becoming No. 1 in the CRM world," said Columbus. As SAP chips away at that goal, "it will be only a matter of time before it is neck-to-neck with Siebel."
All of the ERP (enterprise resource planning) vendors are catching up in this space, he continued. "This is the year the ERP vendors will finally offer some competition to the best-of-breed CRM vendors."
Even so, Abbo is not worried.
"We are always looking at the competition, but we don't believe they are in the same marketplace as us. We are providing sophisticated industry solutions, and -- we believe -- they are still struggling with a generic CRM product." |
