Goliaths in the Land of Davids
IBM and Siebel join forces to target the small and midsize market.
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Should we believe two technology behemoths who boast of being successful selling long-term, very expensive CRM deals to the Global 2000 when they claim to be able to scale down to midsize and small enterprises? Would you put your midsize business at risk working with vendors who, yes, have proven technology, but have not necessarily proven themselves in your market?

Those are the questions to ponder with the recent announcement that Siebel Systems and IBM have partnered to aggressively target companies with 100 to 1,000 employees. The partners, who got together last year to cement a deal that made IBM the preferred platform for Siebel's software, now promise to create lower-cost, easily manageable CRM solutions that will fit with smaller businesses. Enterprises will be able to lease a Siebel sales force automation solution running on IBM hardware for as little as $175 per user, per month, according to the two companies.

The partners are developing solutions that can be deployed "by many companies" in 30 days, they added. IBM will also offer flexible financing plans through its global financing group, the largest IT financing organization in the world.

Siebel and IBM will not only jointly train IBM sales teams that penetrate the midsize and small markets, but will also pitch bundled solutions to IBM's 90,000 business partners. The goal is to convince companies reliant on IBM's technology to use Siebel software to create a potentially seamless network throughout IBM's sales and service channels.

This news quickly followed Siebel's plan to roll out its eBusiness 2000, MidMarket Edition, a streamlined suite of its large-scale e-business software starting at $1,000 per named user. Certainly Siebel and IBM's announcement will make you think twice about implementing or upgrading a CRM solution.

Or will it?

While this is Siebel's most audacious move into the midmarket, it's not the company's first. Last July, Siebel partnered with Great Plains, the back-office software vendor, to create a solution targeted at small and midsize companies and sold via Great Plains' channel of more than 1,400 resellers. The Sales and Marketing Series of Great Plains Siebel Front Office was launched last November and has been well received, several end users said, because of the midmarket expertise of Great Plains' resellers. It remains to be seen if IBM's channel partners can grab the same mindshare with their small and midsize customers.

It will also be interesting to watch the professional services arms of Siebel and IBM try to make good on their claim of "many" 30-day implementations. That implies less customization, but some end users wonder if Siebel and IBM realize that smaller enterprises have the same complicated customer relationship management needs as companies in the Global 2000.

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