Reviving CRM

"If Siebel is to survive, it will have to abandon old-school CRM, and reinvent it as a better way for people to sell to people. . . . Because CRM-as-we-know-it is dead -- and deadly. And it will take Siebel, and more than a few CRM customers, with it."

I wrote that back in April, just after Siebel CEO Michael Lawrie got the bum's rush and Siebel itself was sinking fast. Even Lawrie thought it couldn't survive; we later learned he already had talked to Oracle about a buyout.

Now Siebel is gone. And what's next is up to Oracle.

So here's some unsolicited, free-and-worth-the-price advice for Oracle boss Larry Ellison: Don't waste time trying to merge Siebel's

customer relationship management products with the Oracle and PeopleSoft and J.D. Edwards CRM offerings. If you do that, you'll just end up with a compromise version of last-generation CRM that will be even more outdated by the time it's finished.

Instead, find a sales guru with a vision for the next generation of CRM -- or, better, for the generation after that. Give that genius a world-class development team and permission to pillage the technology base of all those different vendors' products. Put this dream team to work making that CRM vision a reality.

Then make that the migration target for your Oracle, Siebel, PeopleSoft and J.D. Edwards CRM customers.

Expensive? Sure. But you're spending almost US$6 billion for Siebel's customers. (Let's not kid ourselves: The customer list is what you're spending those billions for.) With a change in ownership, every Siebel customer is suddenly in play. And with competitors like SAP, Microsoft and especially lusting after every one of those customers, either you give them a reason to stay or you lose them.

A truly visionary future would be one heck of a reason to stay.

Besides, you know how the alternative plays out. You've already seen it. It's the reason you were finally able to snap up Siebel.

Old-school CRM was already running out of gas by the beginning of 2003. Even Tom Siebel said so, and that was the rocket he'd ridden to make his company the CRM leader. Siebel's plan for dodging that dead-end future: create vertical versions with best practices for each industry baked in.

But that didn't turn Siebel around. Neither did hiring ex-IBMer Lawrie, ostensibly to demonstrate Siebel's maturity and stability. Nor did offering customers a mix of conventional enterprise CRM software and online applications.

Nothing helped. Siebel customers kept drifting away. Siebel's revenue kept sliding. Two and a half years after Siebel-the-man pronounced CRM dead, Siebel-the-company ran out of ways to avoid that reality. If CRM wasn't dead, it was dying -- and so was Siebel.

That's how Siebel's board eventually got desperate enough to sell out. And if you stay this course, Larry -- just recycling the same old-school CRM -- this business will keep slipping down that same slope.

So don't. Show the naysayers that Oracle hasn't just aged into another Computer Associates, collecting past-their-sell-by-date software companies for the maintenance revenue. Prove that Fusion isn't just a lame buzzword that actually signals a long, agonizing migration to the Oracle products that PeopleSoft, J.D. Edwards and Siebel customers rejected back when they had a choice.

Give your CRM customers a future -- or at least a vision that makes that $6 billion buyout worth everyone's trouble.

Otherwise you'll discover, like Siebel, that CRM-as-we-know-it is dead -- and deadly. . . .

But you've heard that before.

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