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SAP targets Siebel with CRM for SMBs

At its user show, SAP unleashed an arsenal of CRM solutions for small and midsized businesses that CEO Bill McDermott predicts will put Siebel on the defensive.

NEW ORLEANS -- SAP made customer relationship management a centerpiece of its Sapphire user event this week, releasing new CRM packages for midsized businesses and announcing a partnership that pairs its CRM applications with the popular BlackBerry handheld devices.

At an afternoon press conference Wednesday, SAP touted the new CRM offerings as a way to allow smaller customers to quickly install pre-configured pieces of mySAP CRM technology, such as analytics, as they are needed. SAP has named the new line SAP Best Practices packages.

In an interview following the CRM-related announcements, SAP America CEO Bill McDermott said he has reshaped the company's U.S. sales force to focus intensely on selling mySAP CRM to companies of all sizes.

This is going to create tremendous chaos for Siebel.

Bill McDermott, SAP America CEO

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"The theme is clear enough to me now that the world is ours for CRM, and that customers are voting against the best-of-breed techniques," McDermott said. "I think this is going to create tremendous chaos for Siebel [Systems Inc.]," McDermott said. "I really do."

SAP and the long-time market leader Siebel have been a locked in an increasingly tight battle, with some analyst reports now suggesting that SAP has pulled ahead in the race to supply companies with software to automate customer interactions.

These new CRM packages are targeted at specific industries: automotive, chemical, consumer products, high tech, industrial machinery and professional-services. SAP estimates that nearly half of its global software installations are in the SMB space, and at this week's user show the company hammered home its "grow-as-you-go" strategy.

In a press release, SAP explained that the packaged offerings are a means for midsized companies -- which may lack the time, staff and budget to take on "extensive software configuration projects" -- to reap the benefits of SAP's CRM experience.

The Best Practices packages come with preconfigured settings and baked in industry-specific business processes, SAP said. In all, the 16 packages feature modules for CRM marketing, sales, service and analytics.

For its part, Siebel is courting smaller businesses with Siebel CRM OnDemand, a hosted service introduced last year, and its recently revamped on-premise software for the midmarket.

For more information

See how SAP is tapping its NetWeaver platform to boost CRM analytics.

Learn more about mySAP CRM 4.0, which was introduced at last year's Sapphire.

When it comes to CRM choices, customers are deciding between go-to-market strategies, said analyst Joshua Greenbaum, principal consultant with Berkeley, Calif.-based Enterprise Application Consulting. Greenbaum said he believes that most companies see the functionality from Siebel and SAP as comparable. For a good chunk of the midmarket, Greenbaum said, SAP's new Best Practices software makes sense.

"When it comes to things like CRM, there is a whole class of functionality that is generic, in that it does not have to be customized," Greenbaum said. "They want the basic blocking and tackling that CRM can provide".

SAP, Greenbaum said, has made obvious strides in its CRM flexibility and functionality. Still, CRM has a lot of potential that no vendor has tapped, he said.

"It's going to get even more interesting."

McDermott said that Siebel's hosted model for small businesses means that companies are "renting their assets, and they want to own their assets." He said that he has been meeting personally with customers of all sizes to make the mySAP CRM business case. His mantra: leverage SAP ERP and supply chain technology in ways that competing CRM vendors obviously cannot.

Meanwhile, the new SAP mobile wireless sales solution, a result of a new partnership between SAP and Research in Motion, is due to ship later this year. It will allow sales staffs to manage their accounts from the field on handheld devices.

McDermott demonstrated the Blackberry offering and said he has been using the product successfully for his own work. The application, which does not require manual synchronization, will allow sales reps to update and access information they need for their on-site visits from anywhere in the world, SAP said.

CRM is "more important than it's ever been," McDermott said. "We are going to focus on this very intensely."

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