PeopleSoft Seeks Piece of Siebel's Action

By Tom Steinert-Threlkeld  |  Posted 2002-08-26 Print this article Print

Online exclusive: At its annual users conference, the human-resources software heavyweight said the pain of Siebel 7 upgrades offers an opening to PeopleSoft's offerings in customer relationship management.

NEW ORLEANS—PeopleSoft, known originally for its human resources software, is taking aim at displacing Siebel Systems as the best-known purveyor of software for managing relationships with customers.

Or at least, PeopleSoft will try to take Siebel down a peg or two.

At its annual users conference known as PeopleSoft Connect, President and Chief Executive Craig A. Conway said his $2 billion-a-year company was trying to exploit "a seam" in Siebel's evolution of its customer relationship software. Siebel customers face a major "re-implementation" of that company's market leading software if they want to upgrade to Siebel 7, the latest version.

So PeopleSoft is urging Siebel customers to make a head-to-head comparison of Siebel's products with PeopleSoft products, using the argument that changing platforms will not be significantly harder than the upgrade they already face to Siebel 7.

Conway said integrated suites of software, such as the ones PeopleSoft champions, will beat "point" solutions such as Siebel. "I've always said it's the integration companies that are going to win," Conway said.

In the past two years, he notes that many strong "category leaders," such as Ariba, in electronic procurement, and i2 Technologies, in supply chain management, have struggled mightily in the face of crumbling markets and troubled implementations. "The Siebels in CRM (and others) that at one time just seemed so insurmountable" are beatable, he said.

Without citing specific market share numbers, Conway tried to make the case that PeopleSoft is now regarded as a strong No. 2 to Siebel in customer relationship management (or CRM) software. And the company trumpeted its ability co convince companies such as Manugistics Group, Crestone International, Norstan Inc. and Sybase Inc. to switch from Siebel to PeopleSoft in the second quarter.

Conway savored a direct swing at Siebel chief executive and company namesake Tom Siebel, who, Conway claimed, had asserted that it takes "12 to 13 mouse clicks to create a customer record in PeopleSoft CRM." Among a spate of product announcements, PeopleSoft introduced a new screen design for its CRM software Conway said allows a use to create a customer record in no more than three mouse clicks.

"I'm not competitive," he said matter-of-factly, leaving it to the audience at the Ernest Morial Convention Center to draw the opposite implication.

Statistically speaking, Pleasanton, Calif.-based PeopleSoft still has a ways to go to catch up to Siebel in CRM, however. According to studies by consulting firms such as AMR Research and Gartner, Siebel last year held an 18 percent share of a roughly $4 billion market for customer management software. SAP held about a 5% share and PeopleSoft, a 3% share.

Tom was editor-in-chief of Interactive Week, from 1995 to 2000, leading a team that created the Internet industry's first newspaper and won numerous awards for the publication. He also has been an award-winning technology journalist for the Dallas Morning News and Fort Worth Star-Telegram. He is a graduate of the Harvard Business School and the University of Missouri School of Journalism.

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