'Siebel and the customer' by Greg Gianforte


Siebel says it's all about the customer, but RightNow CEO Greg Gianforte isn't so sure...

According to Siebel, "It’s All About the Customer." But the truth is that, for Siebel, it’s always been about Siebel. It's an attitude that pervaded the entire business. That’s why they continue to lose customers and revenue.

If it really was all about the customer, then Siebel would have somehow made itself accountable for delivering what its customers wanted – increased revenue, greater customer loyalty, improved productivity. But you can’t do for others what you can’t do for yourself. Are you really going to trust a company that isn’t growing to help your company grow?

You can’t totally blame Siebel, though. They just played the same game that so many other enterprise software vendors cashed in on during the go-go 90’s: take the money and run. We’re the ones who let these companies hype their enterprise platforms, get oodles of money for them, and then leave it to customers and big-ticket integrators to figure out how to actually get any business value out of them.

But you can only sell somebody swampland once. Customers eventually realise they aren’t receiving fair value for their money, and they leave. In fact, many have ultimately decided to simply write off their investment in Siebel and start over with a partner who can actually deliver results.

The really amusing thing is this line from George Shaheen’s letter to Siebel customers: "Both companies [i.e. Oracle and Siebel] are in the process of developing the next generation of applications based on open standards and a service-oriented architecture."

Actually, both Siebel and Oracle are avoiding anything that even resembles the next generation of applications, true openness, and/or software-as-a-service like the plague. All three concepts directly undermine their shell game. That’s why customers are taking their business elsewhere.

However, just in case anyone at Siebel actually wants to know how to grow a CRM company, here are three points to consider:

  1. The "next generation" of applications will not require customers to invest millions of dollars in IT infrastructure and the legions of technologists they then need to baby-sit that infrastructure. Customers in all market segments are embracing hosted solutions, so they can enjoy the business benefits of software without the burden of exorbitant ownership costs. That's what the next generation looks like.

  2. The only technology that's really "open" is open source. As long as you have a vested interest in forcing customers to fork over zillions of dollars for proprietary databases, operating systems, and middleware, you can’t really say there’s anything open about your technology. So don’t be surprised when customers get tired of paying premium prices for commodity infrastructure – and abandon you in droves. Hint: You’ll probably find them over at my place running their enterprise-class environments on Linux, MySQL, Tomcat and Apache.

  3. There's nothing "service-oriented" about exposing one bloated, monolithic applications to other bloated, monolithic applications. If you really want to give customers the ability to mix-and-match best-in-class software functionality, break your solutions up into smaller, more digestible pieces that customers can deploy quickly to achieve rapid time-to-benefit – and easily integrate with their existing applications. That way, you’ll lower their cost-of-entry and allow them to start generating quantifiable ROI before they slice you off another piece of their budget.

Of course, while Siebel is "in the process of developing" a business model that will actually deliver value and attract customers, RightNow and other on demand software providers are busy doing it. That’s why we’ve grown for 30 consecutive quarters and retain over 90 percent of our customers annually. Our customers are intensely loyal to us, because we’re intensely loyal to them. That’s what a relationship is about: mutual benefit and respect.

You’d think a company in the customer relationship management business would know this.

By Greg Gianforte, CEO at RightNow Technologies



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