Siebel: No Future for CRM - article

Siebel: No Future for CRM

By Dennis Callaghan
August 28, 2002

NEW YORK—Tom Siebel sees an enterprise computing future that's dominated by automated business processes and that's based on best practices and applications delivered as Web services.

Speaking in front of an overflow crowd at DCI's Customer Relationship Management Conference and Exposition here Wednesday, the Chairman and CEO of Siebel Systems Inc., added that emerging XML standards on which his company's forthcoming Universal Application Network will be based is technology that other software developers will either have to adopt or suffer the consequences for not adopting.

Such business processes will be based on embedded best practices geared to specific industries, Siebel said.

"There's no market for CRM," said Siebel. "It's not there. There's a lot of companies trying to get into the space and they're building generic sales force automation, customer service or marketing software. But they're going after a market that doesn't exist. There's no market for CRM in the insurance industry. But there's a market for insurance CRM."

Siebel said such business process computing and the attendant Web services that go with it, will be the main thrust of enterprise computing for the rest of the decade.

"Companies that don't make the transition to Web services are going to be like the companies that didn't make the transition to client/server," he said.

Siebel's Universal Application Network will be delivered as part of version 7.5 of the company's namesake software. It was developed in conjunction with several other companies, mostly in the enterprise application integration space, including IBM, SeeBeyond Technology Corp., TIBCO Software Inc., WebMethods Inc. and Vitria Technology Inc.

Siebel said Wednesday that UAN will support Universal Markup Language [UML], a visual language for describing business processes; Business Process Execution Language [BPEL] for executing business processes; XML and XSA for representing these business processes as Common Object Models; XSLT for transforming the Common Object Models into Web services.

The enterprise application integration (EAI) developers contributing to the UAN will all accept these languages, Siebel said.

"We've had the integration argument presented by Oracle [Corp.] and SAP [AG] that says tying together your ERP, your supply chain and your CRM is the holy grail of integration," Siebel said. "But it's not that trivial, it's an enormously complicated problem. We're not talking about tying together three applications. We're tying together 5,000 at GM and 400 at Marriott."

Siebel said application integration accounts for 27 percent of IT spending today.

"Companies who survive and prosper by the end of the decade are the companies who will have solved the [application integration] problem," he said.

Siebel said the UAN will allow his company's software to support both .Net and J2EE-based application servers and said there was room in the industry for both.

"We have multiple standards for operating systems, multiple standards for relational databases, we'll have multiple standards for application servers," he said. "And we'll support them all."

In the not-so-distant future, applications will write themselves to conform to pre-established business processes, Siebel said.

Siebel also predicted that employee relationship management, another of his company's recent product directions, would be a market five times as big as CRM within 10 years.

He also said he surveyed the downsized exhibit floor and predicted even smaller shows in the future, a red meat staple of his CRM conference keynotes.

"This market's tough," he said. "Hundreds if not thousands of companies have already gone out of business and we're not done yet. Eighty percent of the companies you see here today won't be back here in two years."