Siebel restructures to cut costs

Customer relationship management software supplier Siebel Systems plans to cut a layer of its operating hierarchy and reduce...

Customer relationship management software supplier Siebel Systems is to cut a layer of its operating hierarchy and reduce staff as it faces continued flat revenues.

Reporting its preliminary earnings for its second quarter, which ended 30 June, the company estimated its overall revenue at the high end would be around $334m (£201m). It estimated revenue from new licence fees would be $110m (£67m).

Siebel blamed "unexpected delays in purchasing decisions" by customers and uncertain prospects.

Chief financial officer Kenneth Goldman said Siebel would cut 263 jobs, reducing the workforce to 5,589.

Chief executive officer Tom Siebel said that because the economy is not picking up, the company will be restructuring over the next two months, which would include removing some management roles and some unprofitable business operations.

The company will be left with a "structure that we think will allow faster decisions, faster feedback from the market, and simpler interaction for the customer".

Siebel said the changes would not disrupt service to clients.

Customers will just have a primary contact that will tend to manage all those various activities for the customer, so they do not have to manage it themselves across say education, professional services, sales, customer support, all of the expert services, multi channel services.

The company will report its final results for the second quarter on 22 July.

Marc L Songini writes for Computerworld

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