Siebel hands CEO duties to IBM sales exec

Siebel Systems said Monday that founder Tom Siebel will step down as its chief executive and be replaced by IBM sales and distribution head Mike Lawrie. Siebel will remain the company's chairman.

Tom Siebel said Lawrie's appointment stems from a decision he made a year ago to separate the roles of chairman and chief executive officer (CEO).

"We're very, very pleased that our first choice for the job ultimately accepted," he said during a conference call with analysts Monday afternoon. "We cannot imagine a more experienced or talented executive to assume the role."

IBM announced Lawrie's departure from its own staff Monday but did not name his destination. Lawrie, 50, spent more than 25 years at IBM working in a variety of marketing, sales, development and finance roles. He took charge in 2001 of IBM's sales and distribution operations, which includes its network of channel partners.

IBM and Siebel are close business partners, and Tom Siebel said in a written statement that he is pleased Lawrie will join Siebel after several years of working with the company as a partner. IBM is one of Siebel's largest customers, with 60,000 CRM (customer relationship management) seats deployed, and is also its top marketing partner. The companies did US$1 billion in joint business last year, Siebel said.

Siebel, 51, started San Mateo, California-based Siebel in 1993 after rising through the executive ranks at Oracle Corp. Like his mentor Larry Ellison, he is known as an outspoken and domineering leader. The company said he will continue to work full-time at Siebel, focusing on strategy, customer relations and representing Siebel to the business and political communities.

Siebel said during Monday's conference call that he did not step down to pursue opportunities outside Siebel.

"I have no intention of anything like that. My role here will be to continue as an employee and assist Mike wherever I can," he said.

But he also emphasized that he won't be continuing as the company's operational leader: "Mike is the CEO. Mike runs the company. The entire executive team reports to Mike," he replied to a question about his future responsibilities.

Lawrie's appointment as CEO will be effective Tuesday, Siebel said.

Analyst Josh Greenbaum called the executive change a shock, but a welcome one.

"Siebel is known to be the ultimate control freak -- he's hand-on to the nth degree -- so the fact that he's walking away from this operational role is a little surprising. On the other hand, it's a good move. It's long past time for some new blood to be injected into the company," said Greenbaum, who runs Berkeley, California, services firm Enterprise Applications Consulting Inc.

"I give Siebel credit for knowing that it's time for the guy with his name on the door to step upstairs," he said.

Lawrie said he's pleased with Siebel's trajectory, strategy and executive team and does not anticipate making drastic changes. Citing the newness of his position, he declined to discuss goals beyond keeping customers happy and maintaining Siebel's position as a market innovator.

Siebel essentially created the CRM market that it now leads, but the company's growth slowed in recent years as it confronted a downturn in software buying and increased competition from SAP AG, PeopleSoft Inc., Oracle and others.

"The numbers have not been pretty, both relative to its previous growth (and) also relative to its competitors," Greenbaum said. "What Tom Siebel needs is someone who can get the sales going."

Tom Kucharvy, president of Boston-based consultancy Summit Strategies Inc., agreed that rebuilding Siebel's sales will be a priority for Lawrie. Kucharvy said he hopes the regime change signals a new willingness at Siebel to broaden the company's thinking about the applications market.

"They've been a bit closed in the past," he said. "They've been self-righteous in their understanding of the market and dismissive of outside ideas. Hopefully we'll see that change.

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