Can SOA save Siebel?

Siebel Systems has had a rough year. One lousy earnings announcement after another. One CEO makes the mistake of admitting the company has failed to execute and promptly gets executed. So the board installs one of its own -- a guy who presided over one of the biggest dotcom disasters (the ill-fated WebVan). Now, the company is hoping its SOA-inspired Project Nexus will turn everything around and provide the growth boost the company so badly needs.

The company is hoping to accomplish this feat by tapping into what it considers a vast untapped and unconquered market: custom development. It estimates the overall market is 5 times the size of the current packaged CRM market and hopes to take advantage of this dynamic.

Project Nexus, which relies on an SOA framework for its applications, is scheduled to be launched by September. The objective is to enable customers to more easily customize Siebel's applications to address their business challenges. When the full architectural remake is complete next year, Siebel's 8.0 release will include new rules engines and workflow capabilities. The Nexus framework will be aimed at clients with specific needs that can't be easily addressed with packaged CRM applications.

"We've seen the need for a number of years," says Stacey Schneider, a Siebel technology product marketing director, in InfoWorld. "The custom market [buyers] were always in the mentality of, 'We have to build it ourselves, because there's nobody out there who can possible give us a head start.'"

That makes sense to analysts. "What Siebel has recognized is that they have a tremendous amount of internal knowledge and expertise in managing complex deployments," said Nucleus Research Inc. analyst Rebecca Wettemann. "There's a lot they can do in terms of best practices and knowledge. People are definitely looking for that."

But other analysts believe Siebel may be at a serious disadvantage relative to "platform" vendors such as Oracle, SAP ands Microsoft. "Customers are being pushed to make a platform decision, and every vendor is trying to look like they're the best platform," says Josh Greenbaum, an analyst who runs Enterprise Applications Consulting Inc. "In an Oracle or SAP shop, both of them are duking it out, along with IBM and maybe Microsoft. If the bulk of [a user's] processes are not CRM-based, if they’re running supply-chain, finance, human resources, etc., then it might make more sense to look at the suite vendor's platform than to look at the CRM vendor."

To which Siebel's Schneider counters: " CRM is a big space, but the bottom line is, really, to be able to complete any transaction about a customer, you're probably going to have to go to another system.  It’s increasingly important for TCO [total cost of ownership] to reduce integration costs. And we've been working hard with IBM, Microsoft, BEA and other partners on that."