President, Siebel Systems
Born: November 20, 1952, in Chicago, Illinois.
Education: University of Illinois, Urbana-Champaign, BA, 1975; MBA, 1983; MS, 1983.
Family: Son of Arthur F. (lawyer) and Ruth Siebel (homemaker); married Stacy (former Oracle sales representative; maiden name unknown); children: four.
Career: Oracle, 1984–1990, sales representative and marketer; Gain Technology, 1991–1993, chief executive officer; Siebel Systems, 1993–2004, chief executive officer; 1993–, chairman.
Awards: One of the Top 25 Managers in the World, Business Week , 2000, 2001; CEO of the Year, Industry Week , 2002; David Packard Award, Business Executives for National Security, 2002.
Publications: Virtual Selling: Going Beyond the Automated Sales Force to Achieve Total Sales Quality (with Michael S. Malone), 1996; Cyber Rules: Strategies for Excelling at E-Business (with Pat House), 1999; Taking Care of eBusiness: How Today's Market Leaders are Increasing Revenue, Productivity, and Customer Satisfaction, 2001.
Address: Siebel Systems, 2207 Bridgepointe Parkway, San Mateo, California 94404; http://www.siebel.com.
■ During the early 1990s Thomas Siebel pioneered the development of customer relationship management (CRM), a revolutionary approach to sales that involved the use of computer software to automate sales and customer service activities. As CEO of Siebel Systems, founded in 1993, Siebel presided over one of the fastest growing and most consistently profitable companies in the information technology sector. Siebel's CRM software and related marketing strategy spawned an entire industry, earning Siebel recognition as a visionary entrepreneur.
Siebel was born in Chicago, the sixth of seven children in an upper-middle-class family. He was reared in Wilmette, Illinois, an exclusive suburb on Chicago's north shore. His father, a Harvard-educated corporate attorney, sent Siebel to Shattuck Military Academy (later Shattuck–St. Mary's) in Fairbaut, Minnesota, when he was 15. Siebel disliked the strict regulations that governed the school but stayed to appease his father. He grew to appreciate the self-dependence that the experience forced upon him.
Siebel attended the University of Illinois at Urbana-Champaign, where he earned a bachelor's degree in history in 1975. Unsure of his career interests after graduation, Siebel headed west in his pickup truck and found work as a ranch hand in Idaho. Siebel eventually returned to Chicago and worked for a trade book publisher before enrolling in the master of business administration program at the University of Illinois. While in graduate school Siebel became fascinated with computing and ultimately earned two degrees, an MBA and a master's degree in computer science, both in 1983.
In 1984 Siebel was hired by Oracle Corporation, then an upstart distributor of relational database software that had 40 employees. Beginning as a presales representative in Oracle's Chicago office, Siebel was responsible for setting up database demonstrations for Oracle sales representatives and their prospective clients. However, he was quickly recognized as a superior salesman in his own right. Within a year Siebel earned distinction as Oracle's top salesman, outperforming his coworkers largely on the strength of his technical knowledge and ability to translate complex computer jargon for nonspecialist clients.
Siebel's success attracted the attention of the Oracle cofounder and CEO Lawrence Ellison, who moved the rising star into the company's upper ranks. During the next several years Siebel held various marketing positions and contributed toward Oracle's growth as a leading provider of management software. In 1987, while heading Oracle's direct-marketing division, Siebel noticed that his sales reps were wasting time and effort as a result of poorly coordinated customer information. Seeking to eliminate the inefficiencies, Siebel developed a program that streamlined communication within Oracle's sales. The results were impressive. In 1989 Siebel suggested to Ellison that the program, called Oasis (Oracle automated sales information system), could be marketed externally. Ellison, failing to see the program's commercial potential, was not interested. Siebel took a leave of absence from Oracle in 1990 and never returned. He cashed in his company shares soon thereafter, a fortunate move that netted him millions just ahead of a major accounting scandal that caused Oracle's market value to plummet.
In 1991 Siebel was hired as CEO of Cayenne Systems, a small, privately owned multimedia software company that was renamed Gain Technology and sold by Siebel to Sybase, for $110 million in 1992. Flush with the $10 million he received in the deal, Siebel returned to his earlier idea of marketing Oasis. In 1993 he founded Siebel Systems with Patricia House, a former Oracle marketer. Siebel personally provided the lion's share of the company's seed money, but he accepted start-up investments from a few close associates, including the brokerage mogul Charles Schwab, who received a seat on the Siebel Systems board of directors in return.
From the beginning, Seibel demonstrated a personal commitment to customer satisfaction that would define his company and become a hallmark of CRM. Rather than rushing to develop a product, Siebel and House spent months consulting with companies about their individual business operations and software needs before even beginning the design phase. The resulting product, Siebel Sales Enterprise, was a highly customizable computer program that automated sales activity and, in subsequent versions, integrated sales, customer service, and marketing functions. In essence, Siebel's sophisticated software served as a central database capable of distributing customer information among its sales representatives and call centers. Use of the software prevented duplicated efforts and provided a powerful tool for monitoring accounts, tracking purchase decisions, and gauging customer preferences in the interest of developing client-tailored marketing.
Siebel's reputation and key connections helped him land major clients such as Charles Schwab and Andersen Consulting (later Accenture), whose former CEO, George T. Shaheen, joined Siebel's board of directors in 1995. Siebel took his company public in June 1996, a move that inflated his personal worth to more than $280 million and made 40 of his employees into instant millionaires. With a 15 percent stake in the company, by 1999 Siebel had a net worth in excess of $1 billion.
Between 1995 and 2000 Siebel headed one of the most profitable and rapidly expanding companies in the United States, posting successive annual gains over 100 percent and controlling as much as 70 percent of the CRM software market. Clients included Compaq, IBM, and Cisco Systems. In 2001 Siebel Systems reported annual sales of $2 billion with a net income of more than $254 billion. Siebel's rise attracted the ire of Ellison, Siebel's former boss at Oracle. A bitter public feud was waged between the two outspoken rivals as Oracle sought to close in on Siebel's core CRM business.
Siebel's success was largely attributed to his intense focus on sales-based performance and solicitous customer service. He applied firsthand the CRM principles that he sold. Siebel contracted third-party research firms to assess the satisfaction levels of his clients. The reports were used to award bonuses and incentives to employees. Siebel also conducted semiannual performance reviews that resulted in the summary firing of employees ranked in the bottom 5 percent. A harsh taskmaster and unabashed micromanager, Siebel demanded the highest levels of professionalism from his employees. In contrast to the business-casual atmosphere of many Silicon Valley start-ups of the 1990s, Siebel insisted on a formal dress code, forbade employees from eating at their desks, and even dictated the color of the walls and carpets in the company's offices.
A consummate salesman and influential trendsetter, Siebel often appeared as an industry spokesperson. He published several books in which he advocated CRM and its applications in the information economy. Facing an economic downturn in 2002 and growing pressure from competitors such as SAP, PeopleSoft, Salesforce.com, and the archenemy Oracle, Siebel was forced to slash his workforce and reposition his company in the changing CRM environment. In May 2004 he stepped down as CEO of Siebel Systems, although he remained at the company's helm as chairman.
See also entry on Siebel Systems, Inc. in International Directory of Company Histories .
Bartholomew, Doug, "The King of Customer," Industry Week , February 2002, pp. 41–42, 44.
Dillon, Pat, "Tom Siebel," Fast Company , June-July 1997, p. 82.
Hawn, Carleen, "The Man Who Sees around Corners," Forbes , January 21, 2002, pp. 72–77.
"Keeping Customers Satisfied," Economist , October 19, 2002, p. 65.
Kerstetter, Jim, "Can Siebel Stop Its Slide?" BusinessWeek , June 2, 2003, pp. 48–49.
Lashinsky, Adam, "This Time Siebel Guessed Wrong," Fortune , September 16, 2000, pp. 138–142.
McHugh, Josh, "The Hardwiring of a Salesman," Forbes , May 19, 1997, pp. 248–249.
Pitta, Julie, "Grudge Match," Forbes , September 20, 1999, pp. 50–52.
Warner, Melanie, "Confessions of a Control Freak," Fortune , September 4, 2000, pp. 130–137.