InformationWeek

Forrester Group analyst Laurie Orlov is advising clients not to alter their CRM plans. SAP's joint marketing and development deal with Clarify, disclosed last week, "is no big deal," she says, noting that SAP's need to partner is a "tacit acknowledgement that it has failed to deliver a timely CRM solution for its customers."

SAP America president Chris Larsen admits development of SAP's CRM products, underway for more than a year, has proceeded slowly, with only five of 12 planned modules making it to market.

Analysts say SAP's offerings have received a lukewarm reception and that its call-center product was months from completion. SAP will continue to market and support the CRM software it's already released, as well as continue its development work on CRM products unrelated to the call center.

Larsen says SAP teamed with Clarify in order to deliver a mature call center offering quickly. "One-third of our customers say they're making a CRM decision this year," Larsen says. "This alliance creates a higher level of credibility for us. Until now, when people thought of CRM, they thought of Siebel and Clarify. Oracle was mentioned, but SAP wasn't."

The three-year contract with Clarify is nonexclusive, but Larsen calls the alliance "more than a short-term strategic relationship."

Businesses that have already bought a CRM application from SAP will be able to use the integrated version of Clarify without upgrading to mySAP.com applications, according to a company spokesman. But not all users seem to be getting the right message about how the integration will work.

Art O'Donnell, VP of customer service for GTech Corp., a West Greenwich, Mass., company that operates state lotteries for 29 of the 38 online lottery authorities in the United States, says he was briefed by SAP about the announcement and was left with the impression that he could install a version of Clarify that could be integrated with his installation of SAP 4.5. He was later surprised that SAP has no plans to make the integrated CRM product available for earlier versions of the ERP software.

O'Donnell, who says his company needs call-center software to man-age millions of calls per year, doesn't have mySAP.com or SAP CRM applications.

Scientific Atlanta CIO Steve Winterbottom, who also was briefed about the alliance, says he understood that Clarify is integrated only into mySAP.com applications--and that's fine with him. His company, which manufactures and markets cable TV equipment, is considering adding mySAP.com products as part of an upgrade of SAP 3.1h to 4.6. Because Scientific Atlanta needs CRM capabilities to manage thousands of customer calls every day, the new integration could prove valuable.

Meta Group analyst Steve Bonadio says the alliance won't necessarily make SAP a force in the CRM market. Siebel Systems Inc. is now the leading CRM software vendor. Clarify, which was acquired by communications systems provider Nortel Networks Corp. in October 1999, is second in sales in the CRM market behind Siebel.

"This doesn't mean SAP is in a position of strength," he says. "It doesn't mean an SAP customer should not go to Siebel. Large companies typically need to do a lot of customization work when a CRM system is installed, and system integrators have a lot of experience doing that customization and marrying SAP and Siebel. Siebel has the strongest offering in the market."

Forrester's Orlov agrees. And she says that although Clarify continues to offer its full CRM product for standalone installation or integration with other ERP packages, the alliance may create confusion about whether Clarify will continue to offer products for non-SAP users.