Siebel dumps Michael Lawrie in favor of longtime board member George Shaheen, but the new CEO offers analysts few specifics on how he plans to improve the company's performance.
In a surprising move announced Wednesday, Michael Lawrie has been replaced as CEO of Siebel Systems Inc. by longtime Siebel board member George Shaheen.
Lawrie submitted his resignation at the request of the board, according to Siebel chairman Tom Siebel, whom Lawrie had replaced as CEO last May.
"After a comprehensive review of the companys operations and performance, the board determined that a change was necessary, and the board and Mike mutually agreed that Mike would step down as CEO," Siebel said during a conference call with financial analysts Wednesday.
Lawrie could not be reached for comment.
Siebel said Lawrie was replaced strictly because of the companys poor performance. Siebel Systems announced last week that it would miss analysts consensus revenue estimates for the first quarter of this year by about $37 million and post a loss of between $7 and $9 million.
"Its all about performance," Siebel said. "When the board evaluated the operations and performance of the company over the past year, its all about improved and acceptable performance; thats the only issue."
Siebel said Lawrie was judged on the performance of Siebel Systems since he became CEO, not just on the most recent quarter. In the fourth quarter of last year, Siebel under Lawrie broke a string of 13 consecutive quarters of falling revenues. In the third quarter of last year, the company reversed a long-term trend of falling license revenue. But those gains were apparently short-lived.
"If you look at the companys results over the last four quarters, in general they did not meet investors expectations and did not meet internal expectations," Siebel said. "The board did a very thorough review of all operations and performance and thought it was in the best interest of shareholders and the company to make a change."
Click here to read eWEEKs recent interview with Lawrie.
Shaheen, 60, has been a member of Siebels board of directors since 1995. He was CEO of Andersen Consulting, now Accenture, for 10 years, guiding that company from $1 billion to more than $8 billion in revenues in that time.
"In George Shaheen, the board has identified the perfect leader for this company. Hes a proven leader, a man with drive, a man with a commitment to excellence," Siebel said.
While Siebel lauded Shaheens performance at Andersen Consulting, he made no reference to Shaheens more recent and checkered experience as a CEO, at now defunct Internet grocery delivery service Webvan.
Shaheen left Andersen Consulting to head up Webvan in October 1999. He left Webvan in April 2001 with the companys stock trading at pennies a share and more than $600 million in accumulated deficits.
Shaheen later came under fire for repaying a $6.7 million loan he had received from Webvanto pay taxes on company stock options he received as part of his compensation packageby returning the shares he had bought, then worth just $150,000. He was also widely criticized for receiving a termination package from Webvan that would pay him $375,000 a year for life after he left the company. Shaheens salary as Webvan CEO was just $500,000.
Plagued by poor service staggering capital expenditures to build out its delivery network, and what many analysts regarded as a poorly managed acquisition of rival HomeGrocer, which Shaheen engineered and oversaw, Webvan closed its doors just three months after Shaheen departed, burning up to $1 billion in cash by some estimates.
Next page: Shaheen light on specifics.