New chief outlines plan for Siebel

New Siebel Systems chief executive George Shaheen says he will look closely at the company's cost structure as a way of reviving its ailing fortunes.

Shaheen replaced former chief executive Mike Lawrie last Wednesday (13 April) following disappointing financial results.

'We have to look at what drives our costs and discover whether that expenditure is serving us the way we want it to,' Shaheen told delegates at the company's European customer conference in Barcelona this week.

'I would like to see margins improve with operating results. The infrastructure needs to be aligned with the business. My methodology will involve looking at our cost drivers. But I'm not looking at slashing the company,' he said.

Under Lawrie's leadership, Siebel introduced a programme of internal change intended to prove it is putting customers first and moving away from the hard-selling image that critics say has damaged the firm's reputation.

Shaheen says deviation from this strategy is not in his plans, but suggested the company's $2.2bn (£1.1bn) cash surplus could be used to fund acquisitions in support of research and development into new products and functionality. He has also not ruled out the possibility of Siebel being acquired.

'I work on behalf of shareholders. I have a fiduciary responsibility to do what's best for the shareholders,' he said.

'It is my aim to improve performance and, by improving our performance, we'll hopefully be improving the market capitalisation of this company.'

Denis Pombriant, managing principal of US-based analyst Beagle Research Group, said: 'It's important to bear in mind that Shaheen's tenure is only about a week old. He understands the company's direction and is prepared to continue with this fundamental direction.'

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