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Siebel User Week: Integration strategy earns mixed reviews

Siebel has put integration under the spotlight at its annual user show, but not everyone is singing the praises of the CRM leader's strategy.

LOS ANGELES -- Customers and industry analysts are greeting Siebel Systems Inc.'s pledge to better integrate its CRM software and multiple vendor platforms with reactions ranging from praise to skepticism.

At its ongoing Siebel Worldwide User Week 2002, the San Mateo, Calif.-based CRM software maker has put integration on the front burner. It announced a deal with Microsoft Corp. to architect Siebel software for the .NET platform and also released its Universal Application Network (UAN), a business process-oriented integration package based on XML and Web services. Top company executives, including founder and CEO Tom Siebel, devoted much of their presentations to overcoming integration challenges.

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Perhaps the largest threat to the company's CRM market dominance are the continued efforts of enterprise resource planning (ERP) software vendors such as Walldorf, Germany-based SAP, who list tight integration between back- and front-office applications as the primary advantage of their offerings. Companies often complain that integration eats up much of their CRM budgets.

Siebel customers attending the conference viewed the promise of stronger application ties and better integration tools positively but remained curious about the company's timing.

"I'm surprised that more customers hadn't already pushed for guidelines like UAN," said David Gledhill, technology manager at manufacturer Dow Chemical Co. in Midland, Mich. "We, as users, need to see more work along the lines of the Microsoft partnership."

As a longtime customer of Siebel CRM, Gledhill said that Dow expects the software maker to further increase efforts to ease implementation of its products around integration. The company is currently considering an upgrade to Siebel's 7.0 package, Gledhill said.

"Everything that changes in a certain point release means a great deal of integration work for us," he said. "I don't see what they've announced here as earth-shattering in terms of addressing the issue."

Among the improvements Gledhill would like to see are bolstered capabilities to integrate Siebel CRM with his company's SAP ERP deployment.

At least one industry analyst saw flaws in the UAN strategy. David Bradshaw, lead CRM analyst at London-based researcher Ovum Ltd., said that Siebel's plan to drive stronger integration through the use of template business processes may not appeal to many customers.

"The problem is that unless everyone agrees to align to these specific process guidelines, it will still require a lot of work to integrate Siebel with other vendors' products," he said.

Bradshaw said that the establishment of standards may not appeal to users in highly competitive vertical markets such as manufacturing, where business process innovation is seen as the main differentiator.

"Usually, when we hear a cry for standards from a certain vendor, it's a cry for people to adopt the vendor's line of thinking," Bradshaw said. "That won't wash with a lot of users."

Yet the analyst admitted there is no indication that ERP vendors' message of integration has translated into any significant CRM market share.

Edward Garry, vice president of CRM at New York-based brokerage firm Quick & Reilly, said that while it will remain to be seen what breakthroughs Siebel can actually deliver around integration, any efforts should be welcomed by customers.

"You're talking about perhaps the biggest issue with any CRM effort," Garry said. "Providing applications connectors to simplify things from an architectural standpoint, like they're promising with UAN, should allow us to move forward more rapidly."

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