Papows to Resign as Lotus CEO

Lotus Development Corp. confirmed today that its chief executive, Jeff Papows, will resign effective Feb. 1.

Papows served as president and CEO of the Cambridge, Mass.-based maker of Lotus Notes and Domino for seven years. Al Zollar, IBM general manager of networking software at IBM, will replace Papows. IBM, in Armonk, N.Y., acquired Lotus in 1995.

"We are disappointed, because he has been with the company for seven years," said Bryan Simmons, vice president of corporate communications at Lotus. Papows will still be at Lotus until sometime in the second quarter assisting in the transition, Simmons added.

Company officials said Papows wants to pursue entrepreneurial goals elsewhere and work for a smaller company in the future. He has no specific plans at this time, they added.

Analysts said Papows' marketing prowess, with strong backing from IBM, helped grow Lotus Notes and Domino sales.

"Seven years makes a big difference in this market," said analyst Amy Wohl of Wohl & Assoc. Inc. in Narbarth, Pa. "He's the one that is responsible for getting Lotus from a company where Notes was an interesting product, but where the whole idea of messaging and collaboration were not yet mainstream or ubiquitous, to the point where these products have up to 50 million users."

Simmons denied the Papows resigned in response to the allegations of impropriety that emerged last spring. In April, The Wall Street Journal published reports that Papows trumped up his resume and stretched the truth about his military background and personal history to close deals and motivate his staff. In May, Papows faced allegation of sexual harassment from a female subordinate.

Analyst Tim Sloane of Aberdeen Group Inc. in Boston said Papows' departure shouldn't present a concern for Lotus customers.

"Since its acquisition by IBM, Lotus has been repositioning its products as part of the IBM product line, slowly and gradually, so that nobody would die of a heart attack as they do," he said. "They are at the point now where their sales and marketing components are tightly coupled with IBM's sales and marketing campaigns."

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