Siebel, EDS Ink BPO Deal

Siebel Systems Inc. and Electronic Data Systems Corp. this week will announced a partnership to help companies avoid many of the costs and complexities of managing customer relationship management systems in enterprises.

The companies will announce EDS plans to add Siebels software to its BPO (business process outsourcing) services. The pact calls for EDS employees who run customer-facing business operations for other companies, most typically contact centers, to use Siebels CRM applications.

Those Siebel applications will be integrated with other business processes managed by EDS, such as human resources, supply chain and inventory management, using Siebels Universal Application Network for business process integration between disparate applications, said officials of both companies.

The move lets EDS extend its BPO offerings into the front office as it adds Siebels software—still the most widely used CRM software despite three straight years of falling license revenues—to the mix of applications it supports.

Siebel, meanwhile, gets a potential and much-needed new revenue stream from current EDS clients, as well as a new way to reach customers that lack the staff or expertise to manage a complex enterprise CRM system.

The partnership is the first of many Siebel plans to ink in the BPO arena, as the company expands its focus beyond license revenue to include service revenue, according to Siebel officials in San Mateo, Calif.

"[EDS] will get us into a different piece of the market," said Butch Winters, Siebel vice president of alliances. "License revenue is a short-term event. Most of [EDS] contracts tend to be long-term, seven to 10 years. Were quite thrilled to be a part of those relationships.

"Were pretty serious about this [BPO] market," Winters said.

IDC, in Framingham, Mass., values the customer care BPO market at $41 billion.

Saeed Hosseiniyar, vice president of IT in Alcatels Enterprise Networking Group, which has about 2,000 seats of Siebels sales, customer service and marketing applications, has little interest in outsourcing his Siebel business processes.

"Its more cost-effective for us to run Siebel ourselves," said Hosseiniyar in Calabasas, Calif. "Were a small group, weve been running [Siebel applications] for five or six years now, weve become very efficient. But if youre just looking to do CRM now and youve got an implementation ahead of you, then youre more likely to turn to outsourcing."

EDS, of Plano, Texas, will start offering Siebel applications as part of its BPO offerings within six months.

Check out eWEEK.coms Enterprise Applications Center at http://enterpriseapps.eweek.com for the latest news, reviews and analysis about productivity and business solutions.

Be sure to add our eWEEK.com enterprise applications news feed to your RSS newsreader or My Yahoo page