Little is expected to change in the short term at the top-selling CRM software vendor as former IBM executive Michael Lawrie replaces Tom Siebel as CEO of Siebel Systems Inc.
Customers and analysts had a generally favorable reaction last week when Siebel announced he was ceding the position to Lawrie but would remain chairman of the customer relationship management software company he founded in 1993.
David Hahmann, vice president of EMI Industries Inc., a Siebel customer in Tampa, Fla., said the company has become more about product than personality. “The product has taken on a life of its own,” Hahmann said. “I dont think having Tom as CEO makes that much of a difference. Hell still be chairman; hell still be there to set goals.
“Not to compare Siebel to Microsoft [Corp.], but Bill Gates did the same thing,” Hahmann said.
Lawrie has spent virtually his entire 26-year professional career at IBM in a variety of roles. Most recently, he was IBMs top sales executive. He has also headed the Armonk, N.Y., companys Personal Software and Network Computing software groups and managed various overseas operations. He endeared himself to the vocal OS/2 customer base while managing that operating system product for IBM in the mid-1990s.
Lawrie was IBMs point man on several of the companys recent partnerships with Siebel, including the Siebel CRM OnDemand application service offering, which IBM hosts, and a version of IBMs WebSphere application server that support Siebels Universal Application Network.
“What they needed was a strong manager who has experience in managing a global business because thats what Siebel has become,” said Ken Carey, an analyst at Susquehanna International Group LLP in Bala Cynwyd, Pa. Carey said he expects Lawrie to be a good fit for the sales and marketing culture at Siebel.
In a conference call last week, Lawrie said he intended to change little at Siebel in the short term. “Well move forward with the team we have,” he said. “I dont anticipate making significant changes [in management].”
Nor should he, said Carey. “The companys getting back on track; theres no reason to change anything in the near term,” Carey said.
Siebel built Siebel Systems into the top CRM software company in the world in terms of market share. But the companys fortunes have slid in recent years, with revenues down on a year-over-year basis for 11 straight quarters. The San Mateo, Calif., company, which Siebel for years boasted had been profitable since its inception, reported more than $100 million in losses during those quarters, although it has returned to profitability.
As its revenues have fallen, Siebel has also been hit by shareholder lawsuits over expensing of options and alleged overstating of business performance, and it has been fined by the Securities and Exchange Commission for alleged disclosure violations. However, Siebel said he made the decision “a little over a year ago” to separate the roles of chairman and CEO, quietly dismissing notions that he was pressured to step aside.
“A lot of companies, especially in the technology sector, have found that its good to bring someone in from outside with a fresh perspective,” Carey said, noting that Gates and Dell Inc.s Michael Dell have similarly relinquished the CEO title at the companies they founded while remaining active at those companies. Siebel said he intends to do the same.