The Agenda Setters: Siebel VP promises further acquisitions

CRM vendor Siebel Systems is counting on an aggressive acquisition strategy to shake off its traditional customer service image to take on wider ecommerce interests.

This week's Agenda Setter, Pat House, co-founder and executive vice president of Siebel Systems, said the company is actively seeking three or four takeovers a year to transform the company into a major ebusiness solutions provider.

Last month Siebel paid $609m for sales automation vendor OnLink Technologies. This followed April's $440m purchase of CRM firm Opensite.

House said that such acquisitions were a crucial element in Siebel's metamorphosis, which will see them develop a web-enabled version of its ebusiness application, Siebel Ebusiness Application, with upgrades to follow each year.

"Each acquisition focuses on adding functionality to our existing applications, then it looks to broaden the product line as well. The one we see as being very important is wireless. You'll see us expand vertical efforts as well, continually trying to adapt to meet the market standards of [the CRM] industry. We'll also be including applications in more languages as we become more focused on international markets," she said.

However, Steve Morrell, CRM analyst with Datamonitor, claimed that Siebel's new strategy is not as dramatic a departure as it might sound.

"Siebel's definition of CRM is narrow - it looks at sales automation, marketing and call centres. Our view is broader. We look at back systems like data warehousing. Siebel seem to be moving, not so much to ecommerce but to ECRM which is much more about servicing on the internet, e-procurement and enabling people to do ecommerce," said Morell.

According to Morrell, Siebel Systems had begun to lag behind competitors in web-based developments and he insists this is a strategic move for the company in the current marketplace.

"For any other customer we'd say it was a bit late. But Siebel are Siebel. They have a lot of money. They've got a good name in the market - the foundations are in place. And we've been expecting them to come up with some web-based applications."

However, Morrell warned that an annual revamp of applications would make slow progress in the fast paced internet sector.
"Siebel is a fairly expensive solution. They are banking on loyal customers waiting for them to do things. I don't know whether or not customers will wait 12 months," he said.

The full interview with Pat House can be viewed in our Knowledge Management Channel (http://www.silicon.com/a39144 ).

For related news, see
'Siebel pays $609m for OnLink Technologies' http://www.silicon.com/a39001
'Siebel closes in on $440m purchase of OpenSite' http://www.silicon.com/a37076
'SAP sues Siebel for poaching staff' http://www.silicon.com/a33888