New Siebel Chief Outlines Chapter 2 For CRM VendorNew Siebel Chief Outlines Chapter 2 For CRM Vendor

The Mike Lawrie era at Siebel Systems Inc. got off to a distinguished start Monday as the new CEO outlined a new chapter for the customer-relationship-management software vendor during his first public appearance, at the company's user conference in Los Angeles.

A bullish Lawrie told a customer-dominated audience of about 3,000 that "growth is clearly back on the senior executive agenda," and promised that Siebel will ramp up its focus on ensuring that its customers' deployments are successful. After 10 years of focusing on product development and delivery, he said, Siebel had to make changes in recognition that technology is only one part of the CRM equation. "CRM is not a product. CRM is not an event," Lawrie said. "It's a business strategy to drive companies closer to their customers."

Lawrie promised that Siebel would continue to fill out its product suite with modules for handling such things as order management and incentive management, as well as additional products focused on specific vertical industries. He identified business intelligence and customer data integration as potential growth areas for Siebel, and that was supported by the immediate availability of a suite of business-intelligence products designed to analyze everything from sales and service to human resources and the supply chain.

But at least one customer was most intrigued by Lawrie's statement that Siebel would work with customers to develop more customized applications by separating business logic from Siebel applications and then reassembling applications to suit particular business needs. The American Heart Association has been going in the opposite direction, shifting from a customized Siebel deployment to an out-of-the-box upgrade to Siebel 7.7, the latest version of the vendor's CRM application. Now, Dan James, director of customer solutions, says he and his staff will have to rethink things. "Are we going to stick to our guns?" he asks.

The association made the decision to reduce maintenance costs and simplify its upgrade process, James says, and has instructed business units to integrate their own applications with Siebel or change their business processes if the standard Siebel app doesn't suit their needs. He's open to the possibility of swinging back toward customization but is skeptical as to whether Siebel's services unit can deliver the expertise needed to let customers dodge the expense of bringing in third-party services firms. "The thing that scares me is that we haven't had good luck with Siebel professional services," James says.

Meanwhile, amid analyst skepticism regarding the software industry's upcoming earnings season, Siebel said its earnings for the quarter ended Sept. 30--Lawrie's first full quarter at the helm--would exceed expectations and signal a significant bounce back from a disastrous second quarter in which revenue fell $50 million short of expectations and license revenue hit a five-year low. Revenue is expected to be between $315 million and $317 million, while license revenue will rise 10% over the previous quarter and operating income will be up a whopping 500%.