Microsoft picks up CRM customers from rivals

Converts showcased at MS conference

Although a latecomer to the customer relationship management (CRM) business, Microsoft has quietly been luring customers away from more established rivals such as Siebel, now part of Oracle.

Several users at Microsoft’s Convergence 2006 conference, held in Dallas last month, said they turned to Microsoft Dynamics CRM because of its integration with other Microsoft applications, including Dynamics ERP and Office.

In addition, a half-dozen users said Version 3.0, released last year, corrects many of the performance, data synchronisation and other problems in Versions 1 and 1.2 of Microsoft’s CRM software.

Global Comfort Systems plans to replace its Siebel call centre application with the latest Microsoft CRM version because it’s integrated with the other applications and costs less, says Andrew Fralick, IT director at Global Comfort’s US subsidiary, Webasto Products.

German-based Global Comfort expects the cost of installing Microsoft CRM to be about the same as upgrading its Siebel software, Fralick says.

His unit has been using the Microsoft CRM software for about two years, through multiple versions. He calls the newly installed Version 3.0 an “enterprise-class” product.

Fralick says Webasto’s salesforce did suffer through the defects of earlier versions of the Microsoft CRM software. “The [initial] product wasn’t a flop,” he says. “It just didn’t work as billed. Now they have an excellent new version that’s finally there.”

The integration with Microsoft applications prompted Wilson Language Training in Massachusetts to replace its Siebel 6.0 CRM software with Microsoft CRM 1.2 in January 2005, says Brian Kretchman, technical development manager at the company, which provides teacher training resources.

Despite the cost of the licensing, end-user retraining and the data cleansing associated with replacing Siebel, it was “worth it in the end”, says Kretchman, a panellist at the Convergence conference.

Kretchman says customisation of the Siebel software by sales personnel led to IT support problems. The more rigid Microsoft CRM process improved the efficiency of the software’s 60 users, he says.

Wilson intends to upgrade to Microsoft CRM 3.0, most likely in the third quarter.

Helene Cole, CEO of Altara, an integrator in New Jersey, says her company replaced its Siebel software with the Microsoft offering in 2002.

Cole says the Siebel implementation worked well for large customers of its integration services, but proved too complex and costly for internal use.

The Quiznos Master, which sells sandwich-shop franchises, replaced a homegrown CRM application with Microsoft’s CRM 1.2 offering in February 2005, says Kristie Reid, IT project manager for the company’s Quiznos Subs unit. Quiznos now has 550 users of Microsoft’s CRM software and will upgrade to Version 3.0 in the next couple of months, she says.

Reid says Denver-based Quiznos uses Dynamics CRM for consolidated reporting. The former CRM system required several different applications to create reports, she says.

“I’m not surprised to see [small- and medium-sized] companies switching away from Siebel,” says Josh Greenbaum, an analyst at Enterprise Applications Consulting in California. “The cost and burden of a big CRM product like Siebel doesn’t really make that much sense in [that] market.”

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