EBay and Siebel Companies Essay Example for Free

EBay and Siebel Companies Essay EBay EBay is an American, online auction and shopping company in which people and businesses buys and sells goods and services worldwide over the internet. It is a well established company with localized websites in several other countries. The website was established in 1995 in San Jose, California by a French born Iranian computer programmer Pierre Omidyar (Patsuris, 2003). Anything can be sold at eBay as long as it is not an illegal. For example appliances, computers, furniture, equipments and vehicles are listed, bought and sold daily. Large international companies such as IBM sell their newest products and other services on eBay using competitive auctions and fixed-priced storefronts. The company has a well structured eBay express site that acts as a standard internet shopping site for consumers who own United States addresses. EBay generates revenue from a number of fees charged on its services based on various factors. Siebel Siebel systems Inc is a software company that deals in the design, development, marketing and support of customer relationship management (CRM) applicants. The company was founded by Thomas Siebel in 1993.  Initially it was known for its sales force automation products. Later, it expanded into the broader customer service applications that included customer relationship management (CRM) (Kerstetter, 2003). The company benefited from the explosive growth of the CRM market in the late 1990’s. By 1999, Siebel systems was the fastest growing company in United States. With growth of electronic commerce, Siebel formed strategic alliances and made several acquisitions to provide e-business solution for CRM and related areas. The two companies have for a long time experienced a massive growth. They have enjoyed prominence in the market since early 1990’s. However they seem to have taken totally different directions. Whereas eBay is still expanding incredibly, Siebel is on the verge of collapse. EBay has indeed developed superbly from its humble beginning. Currently, at least 30 million people buy and sell over 20 billion dollars in merchandise. Over 150, 000 entrepreneurs earn a living selling on eBay. The company provides a new way of doing business. EBay has an exceptional educational system that teaches people on how to sell on its website. It has a payment system that allows buyers to make electronic payments to sellers who can’t afford a merchant credit card account (Hof, 2003). The company has a different way of management in this era. Through the web, eBay citizens have a full time access to every activity performed in the company. The whole system is very transparent. Products and services are subjected to close scrutiny by customers before any business deal is undertaken. (Hof, 2003). The transparency involved in eBay business makes customers and vendors to be collaborators and colleagues. The company has a superb management that can be borrowed by many. It is based on cooperation and finesse not coercion and force. EBay executives work like civil servants rather than corporate managers (Hof, 2003). This enables the company to stay in touch with the needs of customers. This approach offers a lot of benefits to the company. Good management at eBay is shown by its financials. The company profits shot from 176 to 250 million dollars in the year 2002. Net sales from transaction fees on 15 million dollars in gross revenue hit 1. 2 billion dollars (Hof, 2003). This growth has made the company enjoy supremacy in the market. The company has done well to reduce problems of shipping goods, simplifying payments and cracking down crooks on the site. The company always listens to the needs of customers to improve its services. This is done through constant meetings with sellers and buyers asking for their opinions, complains, and suggestion to improve their services (Hof, 2003). As a result users feel part of the company and take necessary initiatives to expand the company’s economy. EBay has a well organized way ensuring security of its business. It has a special police unit that helps to crack down any fraud activities which can turn off prospective customers. It has a Trust and safety department staffed by several EBay employees all over the world (Hof, 2003). As businesses on EBay grow larger, the market is also expanding. As EBay is achieving financial supremacy Siebel takes an opposite route. Although the two companies started almost at the same level, Siebel currently faces a stiff competition from other companies. It has been on the down ward trend in recent years. The giant company of 1990’s has collapsed than its rivals. For example, revenue in 2002 lost by 22% to reach at 1. 5 million dollars. The stock price faced a massive drop by 94% to reach 8. dollars from its peak of 119 dollars in the year 2000 (Kerstetter, 2003). The company has lost touch with customers. Customers are extremely reluctant to buy company products. It has of recent past suffered from bad publicity, as customers show dissatisfaction. It has lost its strong ground to corporate application leader (SAP). The reputation of the company has been lost. In 2002 the company’s share of customer-management market flopped from 29% to 23% (Kerstetter, 2003). The company faces a managerial crisis. The management is continuously shuffled in pursue of the lost glory. Although the company has introduced new technologies, still the sales are growing weaker every year. However the leaders fail to acknowledge that a problem is looming in the company. As software market grows yearly, Siebel systems can no longer dominate it. The competition has grown so strong that Siebel might never recover. Research show that, the company revenue has been falling at an alarming rate. Many corporations that used to deal with the company currently prefer suppliers who offer broad range of integrated products like corporate planning and human resources (Kerstetter, 2003). The company has done little to decrease the growing number of dejected customers who have lost faith in the company. Many complain of having not met their target even after two years. However top managers still do not realize the problem. The company is trying to develop new technologies as a way of bouncing back to the market. However this is a big gamble. The competing companies like SAP have gained a lot of momentum and will still offer stiff challenge (Kerstetter, 2003). Siebel need to undertake major changes to enable it recover. However this is a journey that will need a total overhaul of the administration and a change in strategies. Unless an urgent step is taken, Siebel will collapse totally. The two companies EBay and Siebel differ a lot because of the path they follow. As EBay enjoys an upward surge to economic and financial superiority, Siebel is struggling a lot. The companies also not only differ in their fortunes but also in their administration setup. EBay has put all the necessary administrational techniques to ensure that the company competes favorably in the market. EBay tends to take into consideration the interests of the customers more than Siebel. The company still holds a lot of following from its customers who are increasing all over the world. The company has superb strategies that make them a force in today’s global market. Siebel need to go back to the drawing board if at all they hope to change the turn of events. The two companies offer a lot of lessons to business, management and all financial undertakings. It is evident that managerial skills are very vital in enabling companies to grow (Hof, 2003). Unless an exciting and creative management is in place, business undertakings can never achieve the best. The management ought to be enterprising and ready to undertake constant changes as a way of keeping the companies alive in the ever changing global market. It is also important to take note of the ever changing consumer needs. All business companies should direct their business towards the needs of consumers. Unless consumers have faith in the company, success will always be elusive. Many companies collapse due to failure to acknowledge the need to keep consumers always in mind. Companies should be ready to shift their short term objectives as consumer needs shift. Technology also plays a big role in the business industry. It is an important factor in any business undertaking. Successful companies embrace new and advanced technology to boast their output (Kerstetter, 2003). That is the only way that customers can stick to the company because of superior output. Companies should strive to embrace new technology to enable favorable competition in the market. It is also important for companies to undertake a thorough research always. Research enables them to read the market trends. In that way companies can be able to keep in touch with the latest market trends.  This can also help to shape the production channels according to the market trend. Companies and business enterprises ought to device means and ways of maintaining faith and trust of their customers. There should be a way of keeping customers hooked up to the company and opening it up for many others. Skillful management can enable companies achieve this. All successful businesses always keep these in mind. As long as a company has good management, respect and trust from customers, it will be easy to introduce new products in the market. EBay serves as an example to be followed by all business enterprises.