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IBM performing largest Siebel implementation ever

IBM is currently about halfway through what will be the largest Siebel implementation ever.

While some may quibble about the future, for now there's no doubt that Siebel is the top dog in the CRM market...

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Although Siebel has not really put much into publicizing it, technology giant IBM is the company's biggest customer. IBM is currently about halfway through what will be the largest Siebel implementation ever -- Big Blue already purchased 83,000 Siebel licenses, and by the time the rollout is completed, that figure may well rise. IBM estimates that 11% of its revenue this year, about $8.6 billion, came through channels run on this software.

Context

Because it's such a behemoth, sometimes IBM can't avoid but to do things in a big way. Spending three and a half years as well as millions of dollars and man-hours redoing several major IT systems, however, is not something even IBM undertook lightly. Called CRM2000, the project will eventually incorporate all of IBM's lines of business, allowing hundreds of thousands of employees, business partners and customers in 164 countries to share information.

IBM has created a configuration, code-named Shark, to run CRM2000. Shark includes IBM's DB2 database, WebSphere application servers and MQSeries messaging software. The software, of course, runs on IBM hardware, mainly eServer pSeries servers coupled with Enterprise Storage Server.

The first phase of the project, implementing Siebel's call center package for all 26 of IBM's global call centers, has already been completed. Next up are the marketing teams, field sales and services, including post-sales service and field-sales service.

This attempt to standardize the customer experience across all contact channels will also result in a net reduction of IT systems within IBM. When the company was preparing for Y2K, it took a count of how many CRM-related systems it had, and the number topped 1,000. Many were tiny, but there were also many major operational systems. The CRM2000 project will reduce that number to a more manageable 300.

Lessons

Although project completion is at least 18 months away, the company claims to have gleaned several important lessons from the process that it has started passing on to its customers. Some of them are fairly trite, such as figuring out the strategy as it relates to the business and not as it relates to the technology.

But just because customers hear such hoary aphorisms from services companies doesn't mean they actually take them to heart. IBM in fact fell into this trap -- the company's services wing has long preached a message of detailing as much of a project up front as possible, but when it came to the CRM initiative, IBM officials admit, they used much too broad a brush when detailing strategy. Now the company will be more careful to lay out just how important this is to its customers.

According to Cher de Rossiter, the executive in charge of the CRM implementation, IBM now tells companies up front that their data is much worse than they ever could believe and that they need to start thinking about it from day one -- a lesson clearly learned the hard way.

IBM has also been thinking a lot about training. Based on its own experiences, it now knows that companies cannot put people in a classroom for two weeks to train them on a new CRM system. The users of these systems are frontline people and they can't be gone for that long. In addition, companies cannot throw too much information at them at once. Because of these two factors, IBM has decided that training has to be broken up into digestible chunks, or else the users will simply not absorb what they are being taught. This approach also allows a company to change the system as its business changes without having the hassle of retraining all of the employees.

Conclusion

While IBM would like the results of the CRM overhaul to be apparent to its product customers, the company also certainly took its message public as a way to boost its services business. It is a way of saying, 'if IBM Global Services managed to successfully implement a CRM system within IBM's famously slow-moving global bureaucracy, they can do it anywhere.' It also acts as a good proving ground for applying IBM's technology, such as the Shark configuration, to a real-world CRM project.

That argument seems reasonably sound to the451, as long as we are talking about a fairly large customer. If it can pull off this implementation on time and on budget, IBM will have proven itself more than capable of handling the technological, corporate and change management issues that inevitably accompany a project of this scale. While IBM claims to have discovered numerous lessons applicable to smaller customers, a company below the $500 million mark in annual revenue should carefully evaluate whether more midmarket-focused CRM services providers might not better meet its needs than IBM. For larger companies, however, IBM's experience and its tight relationship with Siebel will make it a company impossible to ignore.


the451 (www.the451.com) is an analyst firm that provides timely, detailed and independent analysis of news in technology, communications and media. To evaluate the service click here.

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