Siebel Systems Inc. learned last week that it truly can be lonely at the top. The San Mateo, Calif.-based CRM giant, which holds 45% market share, took a hit when Nucleus Research made public its conversations with several reference customers listed on Siebel's Web site. Many of those customers complained about implementations that ran over budget, took longer than planned and didn't deliver anticipated returns. In a market noted for much-publicized installation failures, was it fair of Nucleus to single out Siebel? That's the question we posed to two industry insiders who also server as experts on SearchCRM.com.
Siebel suffers another "chink in the armor"
By Bob Thompson
Based on our CRMGuru research this report is no surprise at all. However, I think similar results would be obtained by calling the glowing references posted on many other vendor Web sites.
Another thing to consider is that Nucleus Research is new, and there's no better way to get ink than to slam an industry leader. I'm not saying they necessarily had an agenda or that the research was done improperly, but it's a great marketing strategy to get noticed.
Last year's CRMGuru study compiled more than 2,000 responses, with more than 500 on Siebel Systems' customers and evaluators -- those with in-depth information about Siebel's products, service, support, etc. Overall satisfaction was low compared to similar industry studies, and Siebel ranked in the middle of the CRM pack.
Does this make Siebel more vulnerable? Yes, it's one more chink in the armor of the industry leader. Will it change the industry in the short-term? No.
But overall, these results correlate with my own observations and research, which shows Siebel's marketing does a very effective job of painting a picture that doesn't match reality. The "happy customer" stories are carefully managed, and I suspect some Siebel references actually receive sales concessions in return for agreeing to provide customer testimonials.
One more thing: The technology is 20% to 25% of the "solution" for a successful CRM project. The other 75% to 80% is the responsibility of the customer, as well as the systems integrator or consultant. Yes, vendors need to shoulder their fair share of the blame, but clients would be wise to look at their own culpability when things go wrong.
Bob Thompson is founder and president of Front Line Solutions in Burlingame, CA, an independent consulting and research firm specializing in partner relationship management (PRM). He also created and runs CRMGuru.
Researcher took "cheap shot" at Siebel
By Chris Selland
There's no doubt that this report will impact Siebel. From a PR perspective it's clearly a major negative. However, I tend to believe that Nucleus published this research more to gain publicity for itself than to provide any type of service to the industry. As I mentioned in my recent article on SearchCRM.com, analysts often sell their services by sensationalizing "failure," and I believe this report proves my point.
For instance, CRMGuru published a report last fall that found similar levels of dissatisfaction -- not only within Siebel's customers but across all of the major CRM vendors. There is no doubt that CRM satisfaction levels leave a lot to be desired, but this is an industry problem.
In other words, every vendor in the industry has been guilty of over promising and under delivering. But I believe -- and have witnessed -- that Siebel has done at least as much as any of these companies to help improve customer satisfaction and did not deserve to be singled out. It's always easy to take cheap shots at the market leader, but once the noise dies down I don't think this report will have much of a long-term impact. I believe that Siebel recognizes that, as the market leader, they simply must have satisfied customers and will continue taking the necessary steps to insure that happens.
Besides, how many similarly negative reports have been issued about Microsoft over the years?
Selland is the founder of Cambridge, Mass.-based consultancy Reservoir Partners. Previously he worked as vice president of marketing at eSupportNow and vice president of e-business strategies at analyst firm Yankee Group.
Bite-sized projects could lead to CRM satisfaction
By Paul Sweeney
First, it's not too big of a surprise to hear that users might be dissatisfied with any project that averages $6.59 million. These are complex projects. By nature, Siebel projects are huge and seemingly small issues can result in substantial cost and time overruns. Why? Because you're typically dealing with enterprise integration requirements and problems. When bumps in the road are encountered there are many players that need to quickly get on board and on the same page at the same time. A slight realignment of approach or strategy can then affect multiple tasks and people across several business units and IT departments. Translation: time and money.
Second, by admission, half of those complaining about poor ROI did not have a process in place to measure it. It's impossible to advertise a project as successful without the criteria to back it up. Shame on the project stakeholders for allowing these projects to go forward without this very critical analysis in place.
Third, the business climate of the past several years demands positive monthly and quarterly results. This has been exacerbated by the dot-com bust. In contrast, most Siebel projects (by design) require many months, even years, to complete. And, like all large projects, positive results require patience, tight project management, vision and leadership. A weak economy places enormous stress on all of these factors and erodes the faith and spark that was present at the beginning of the project. Why? Budgets get squeezed, business priorities change, people get laid off, projects suffer. The result: missed deliverables and dissatisfied users.
Here's the solution. Divide and manage these projects into smaller and more affordable bite-sized pieces. Each project component should be cost/benefit justified and defendable. Determine the success factors of each deliverable at the beginning of the project and measure the progress of the project against these factors on a weekly basis. Heavily promote the project successes, and aggressively manage the trouble spots. Most of all, hold both business and systems stakeholders accountable for their deliverables. Compensation and promotions should be at risk. Nothing less is acceptable on Siebel-sized projects.
Paul Sweeney is founder and president of Sweeney Group Inc., an Acton, Mass.-based independent consulting firm specializing in the selection, design and integration of CRM systems.
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