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Time for the CRM faint hearts to leave the stage

Eugene Lacey ZDNet.co.uk

Published: 10 Sep 2002 16:16 BST

Tom Siebel has a knack for delivering the lurid quote or sound bite. Two weeks ago in New York he raised eyebrows at the CRM Conference by asserting "There's no market for CRM. It's not there."

"Does he mean us?" must have been the thought running through many a Siebel employee listening to the keynote. They didn't have to wait long for an answer. No, he clearly didn't mean the company that carries his name. When Web services rule, Siebel's out-of-the-box e-business solutions, tailored to the needs of specific industries, will have a strong appeal, he argued.

The future is in automating business processes and coding in 'best practice' approaches, says Siebel, banging the drum for Web services and yet steadfastly refusing to get off the fence on the J2EE versus .Net debate. "We'll support them all" he says.

All well and good -- pretty much the standard Siebel sales pitch from a man who, more than any other, can claim to have created the category and therefore commands the attention of all those interested in CRM's future.

The problem is that the message isn't getting through to a key audience -- the chief information officers of large organisations. A recent Morgan Stanley survey into the views of this group found: "20 percent thought CRM is useful, but not a high priority at the moment" and another 20 percent noted they were unsure about the potential return on investment. Twenty-nine percent said they either didn't need CRM or were sceptical about it.

According to the survey, firms would rather spend scarce IT development funds on integrating applications and buying security software. Neither Siebel nor anybody else in the CRM business should be panicked by these findings. The 9/11 factor is behind a good deal of increased spending on security. It is almost impossible to say how long anxiety over security will run -- though equally firms will reach a level of best practice in security beyond which there is unlikely to be commercial or competitive advantage.

CRM, on the other hand, remains by definition a customer-facing technology and is therefore much closer to the bottom line performance of organisations than security. There is enormous potential for boosting competitive advantage by improving customer relationships.