Sitting in the Catbird Seat
I once thought collecting what I called ‘Americanisms’ — unique phrases that come from deep within our culture might be a fun undertaking. It seemed like the business world was always full of them and it would be easy to collect some into a dictionary or encyclopedia-like book — the kind your aunt Muriel might give you for the holidays. I got a good start with things like “They’ve been rode hard and put up wet” and others I can no longer remember. But then the Internet happened and ideas like this became the fodder of Web sites. I was tooling around one of them, World Wide Words the other day in search of the origins of another favorite, “The catbird seat”.
The catbird seat is one of those phrases that you might instinctively know from growing up speaking American. It means sitting pretty, having an advantageous position. In the middle of the 20th century, hall of fame baseball announcer Red Barber would apply it to batter with a count of three balls and no strikes — the upper hand. But finding its origin might be problematic, and what might this have to do with CRM anyway? Well maybe a lot, read on.
There really is a species called the catbird, and it’s a relative of the mockingbird. Like its cousin, the catbird is a great imitator and one of its specialties is the feline meow. The catbird has a seemingly innate sense of its own superiority, possibly because it can intimidate its competitors by imitating a predator, and when it stakes its claim to territory, the catbird instinctively selects the highest perch available from which to issue its song and it is that perch that is signified as the catbird seat.
As I look at the CRM market in early 2006 I see a vastly changed landscape than was evident a year ago. At the beginning of 2005 Peoplesoft was still fighting its hostile takeover by Oracle and Siebel was an independent entity, leading the CRM market. There were others in the hunt too, most notably SAP and Salesforce.com as well as a burgeoning group of vendors building out the on demand space.
A year ago Siebel was the CRM leader with SAP nipping at its heels. Critics (myself included), loved to point out SAP’s funny accounting methods that brought it into a virtual tie for market share leadership in the conventional space. And Salesforce.com led the on demand market with a crusade that at times looked more Ken Kesey-esque than high-tech.
A year later everything has changed. Having gobbled Peoplesoft and on the verge of ingesting Siebel, Oracle dominates many of the leadership categories by the numbers. But the numbers don’t tell the whole story. It is SAP and Salesforce.com that have market momentum and each is a more likely successor to the catbird seat than the Oracle alliance. And the two, though vastly different in product lines and outlooks, have more in common than might first appear.
To my mind, the lesson of the moment — who sits in the catbird seat today — has a lot to do with the financial paths each took to their present situations. Recall back to the Internet bubble, a time that is receding from us now but which still has all of the resonance of the big bang, when companies were forming and reforming. IPOs were common and stock valuations were so high that companies were using their certificates like cash to buy one another.
Some companies, like Siebel, grew by acquisition buying up competitors and complementary parts as fast as they could, cementing them together to build bigger and bigger product suites that customers found difficult to deploy and maintain. If early vendors gave the world a taste of the power and utility of CRM they also drove demand for better, faster, and above all cheaper solutions that later entrants would deliver.
What’s interesting to me right now is that most of the vendors that grew like mushrooms after a summer rain have been sidelined by financial pressures — either leaving the field bowing to the verdicts of the market or obeying the imperatives of finance by being acquired. Today’s market leaders are SAP, a company with a strong cultural bias toward building what it sells and another, Salesforce.com, which, to my knowledge, has never acquired another company. In the mergers and acquisitions arena as everywhere else, Salesforce.com has blazed its own trail by making complementary product integration part and parcel of its value proposition. Why spend the money buying and integrating when partners are willing to do the work themselves?
For the moment it appears that the companies in the catbird seat got there, dare we say it, the old fashioned way. They listened to the market, built what customers told them they needed and sold what they had. It’s an instructive message as new companies form around interesting ideas and venture firms try to figure out whom to back.
A one way trip to Palookaville?
The Boston Red Sox team bus made a detour on its trip to Palookaville yesterday. The team stopped in New York just long enough to let Johnny Damon go to the Yankees. That leaves the former World Series winner significantly depleted. Just something like 4 or 5 players from the team that won it all 14 months ago remain. The Red Sox now have two (count em) general managers, no center fielder, a left fielder who wants out, no short stop or first baseman, and I could go on but why? In case you ever wondered, Yankee fans are not born, they are made by the countless idiotic decisions that emanate from Yawkee Way in Boston.