SAN DIEGO -- Best-of-breed CRM applications vendor Siebel Systems Inc. may lead the enterprise market by a long shot, but some customers here at Oracle AppsWorld said they might refuse Siebel software even if it were being given away.
Underlining one of the most significant philosophic differences in the CRM market today, Oracle customers seem certain that an integrated front- and back-office applications strategy gives them a leg up over users of best-of-breed competitors, namely San Mateo, Calif.-based Siebel.
Case in point: network switch vendor McData Corp. in Broomfield, Colo., formerly a Siebel shop and now an Oracle CRM user.
"The problem with Siebel was that we kept buying software licenses in hopes of making it work, but we never saw much return," said Deb Morton, director of business systems at McData.
Morton said McData spent a year and a half trying to make Siebel fit into its growing e-commerce business, but she labeled the effort "a disaster." She said the company feels lucky it was able to salvage some of its investment in Siebel by rolling existing licenses into a sales force automation project.
One of the reasons Morton feels Oracle was a better answer for McData's CRM needs lies in the Redwood Shores, Calif.-based software vendor's background in financial database software. The ability to tie in detailed financial data when building links to partners was a critical advantage, Morton said.
McData now ships 35% of its products directly from outsourcing partners. Morton estimates that this alone has allowed her company to realize a 170% return on investment (ROI) around its Oracle CRM project after only one year live. Morton said she expects more than 500% ROI down the road, and she estimated that Oracle CRM has cost McData 30% less than what it was paying for Siebel.
Another company singing the praises of Oracle's integrated suite approach is networking and telecommunications equipment provider C-Cor.net Corp. in State College, Penn. While the company has only just begun to implement CRM, Barbara Lyke, director of IT, said she never even considered going with best-of-breed software.
"I can't imagine trying to endure the level of integration involved with implementing Siebel," Lyke said. "The real-time data we can get through the links Oracle has to its financials are what will deliver CRM benefits to our customers."
Lyke said the integrated suite approach was the main driver in deciding to go with Oracle at C-Cor.net.
The vendor decision for Brad Snook, vice president of CRM at telecommunications maintenance provider United Asset Coverage Inc. in Naperville, Ill., came down to Siebel versus Oracle. In the end, it was Oracle's renewable service contract feature and the software maker's ties to financial applications that closed the deal.
Siebel, which by some estimates has 45% of the CRM market, has made a big push around its application integration strategy. In 2002, it rolled out its Universal Application Network, which is part prebuilt business process library, part integration server software.
The push came in response to CRM implementers who routinely complain that integration eats up a large portion of their budgets and who have been clamoring for lower-cost answers.
Some industry watchers are already calling for 2003 to be the year that Oracle CRM finally emerges as a viable alternative to Siebel. As it stands, Oracle is lined up with fellow ERP providers PeopleSoft Inc. and SAP in a tight pack of challengers to Siebel's CRM dominance.
While admitting that Oracle has had issues with everything from product positioning to basic quality, analyst Rod Johnson of AMR Research Inc. in Boston has a list of reasons why customers should see "a marked improvement" in the strategy and execution of Oracle's 11i CRM package in the second half of 2003.
Among the improvements Johnson is tracking at Oracle is the vendor's sales force realignment. Oracle reordered its teams around both applications and technology, allowing for greater numbers of sales to existing customers. Other factors the analyst sees as positive include more clearly defined internal leadership around CRM at Oracle and a growing list of positive customer references.
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