On April 10, Siebel Systems, Inc., the world's leading supplier of CRM
software, and Lawson Software, the supplier of Internet-enabled enterprise
applications, announced a global distribution agreement in which Lawson
will integrate and sell its new line of enterprise applications with Siebel's
comprehensive suite of eBusiness applications for sales, marketing, and
Lawson's worldwide sales force will sell this complete family of eBusiness
solutions and eServices along with industry-specific technical training,
consulting and support to both mid-sized firms and large enterprises.
The combined product suite, marketed as a component of 'lawson.insight'
product suite, will be available in the second quarter of 2000. Both Siebel
and Lawson are committed to ensure the success of every customer implementation.
Siebel eBusiness Applications integrated with lawson.insight's Self-Evident
Applications and transaction engines will become a primary Lawson product
line comprising sales, marketing, and customer service, as well as enterprise
functions. This combined solution will let Lawson customers move from
a process-centric to customer-centric focus and gain insight into every
aspect of their business across all channels - a compelling advantage
in the highly competitive "new economy."
Inc., a leading application service provider (ASP) that currently provides
an integrated Siebel and Lawson application solution via the Internet,
believes users will welcome the combined solution. "USinternetworking
manages both lawson.insight and Siebel eBusiness Applications, and the
demand we see for both companies' software applications indicates that
this integrated solution will have strong appeal to a significant group
of clients worldwide," said Christopher R. McCleary, chairman and CEO,
By partnering with Lawson, Siebel Systems gains full integration with
a leading provider of enterprise applications comprising financial services,
human resources, procurement, distribution, and analytics. The companies'
combined resources will let Lawson quickly deliver a comprehensive solution
that satisfies the needs of more than 3,000 Lawson customers worldwide,
in fast growing industry sectors such as healthcare, retail, and professional
services. Ongoing development efforts will be conducted by the partners
to support customers of the lawson.insight joint solution.
Earlier in March, at its user group conference in San Diego, Lawson Software
unveiled plans to re-brand its products and make them available from third-party
Application Service Providers (ASPs). Lawson will re-brand its traditional
suites as e-business engines, Self-Evident Applications (SEAs), and extensions
under the name 'lawson.insight'.
will roll out a web-based interface for its enterprise software called
eConsul, and its ERP packages will be hosted by ASPs including USinternetworking
Inc., Annapolis, Md. The move will give Lawson's channel partners new
opportunities in a variety of vertical industries that will need customized
solutions. The company has already started training channel partners to
take advantage of new software models.
The first part of the news is not a shocking surprise. We already expressed
our concerns regarding Lawson's original decision to deliver an internally
developed CRM solution (See TEC's note from February 18 "Lawson Software:
Self-Evidently Thriving on Innovations"), as the task has proven to be
a tall order even for its bigger and stronger competitors.
Somewhat intriguing is, however, the fact that only now has Lawson's management
conceded the initial error in judgment and drifted from its original CRM
strategy. It announced last fall that it was developing a sales force
automation tool as the first component of a planned CRM product line.
The sales application was scheduled for beta-testing this spring and shipment
in the summer. The solution was even demonstrated at IEC Exposition in
New York at the beginning of March. Unfortunately, the company belatedly
realized it would take too long to build the CRM suite internally. The
sales automation package apparently addressed only one-fifth of the functionality
needed to match an existing suite such as Siebel's. Therefore this sudden
change of plan in style of "if you cannot beat them, join them".
err is human. The time and resources have indeed been wasted, but the
damage is a far cry from bring irreparable. Lawson is not the only business
applications vendor that has signed a reseller deal with Siebel. Siebel
holds a reputation of a 'partnership-friendly' vendor given the fact that
it partners with a myriad of other vendors. J.D. Edwards & Co. has resold
Siebel's sales automation software since last spring and in February said
it would also start marketing the rest of Siebel's CRM packages. Great
Plains has even claimed the completion of the first phase of integrating
Siebel within its eEnterprise product.
partnership between Siebel and Lawson could be very interesting, as both
have exciting products and technologies. Siebel will gain access to Lawson's
large customer base within specific industries that have not yet been
made aware of Siebel's capabilities and products. Lawson, on the other
hand, is betting on the notion that one cannot go wrong in selling Siebel's
products. The existence of common ASP partners like Usinternetworking
is also beneficial.
one should never expect a flawless and quick integration effort. One issue
will be the user interface mix of a future product suite - the 'same look-and-feel',
that Lawson has been able to proudly exhibit in the past will be impaired
to a degree. Siebel's interface, while indisputably intuitive and compelling,
is by no means so 'self-evident' like Lawson's that extensive training
is not needed. Another thing to bear in mind is the lack of Siebel's vertical
focus within some of the industries that are Lawson's stronghold, e.g.,
healthcare and professional services.
As for Lawson's decision to somewhat downplay its traditional client/server
business model, we believe there are a number of reasons to support it.
The first is the growing market awareness of the cost ramifications of
implementing and maintaining the traditional client/server architecture
of the past.
second reason is the Internet enablement and compelling user interface
of Lawson's applications. Lawson has never been a staunch proponent of
fat-client technology. On the contrary, it has long been promoting its
Self-Evident Applications (SEA) initiative, with the idea to tremendously
simplify the learning curve required by users. The need for this becomes
more obvious with the increase of number of internal and external users
that use the product on a self-service basis.
The third reason is Lawson's initial success in its ASP quest. It claims
to have seven hosting partners, with a several dozens customers worldwide.
While we believe that Lawson is making a brave move, we also think it
is one of the few ERP companies that can afford to make such a differentiating
move. Lawson's main customer base is within the healthcare, financial,
and professional services space, and sells mainly to smaller firms that
are generally more attracted to the notion of turning over their applications
to someone else to run, while they focus solely on their core competencies.
Moreover, Lawson's software consists mainly of financial, procurement,
and human resource transaction systems, the ERP components that customers
are generally more eager to outsource.
Lawson, however, may feel a pinch in the immediate future should it decide
to deliver its product only in the ASP mode. While CIOs make outsourcing
software a serious consideration for any future IT plans, few are willing
to jump on the bandwagon just yet. Also, customers like to be given a
choice, and some may not appreciate having only one option, particularly
while the market is in its nascent stage. Therefore we have got Lawson's
assurances that it will continue to deliver its products in the traditional
mode too for the foreseeable future.
As a relevant example, while Infinium Software, a vendor with similar
product offerings and customer base to Lawson, has been forking out an
enormous amount of resources in its own ASP operation, it is not giving
up on its conventional service execution model as yet.
believe that the idea of buying software services "across the wire" instead
of in-house implementations will not become the most common model for
at least 36 months. Notwithstanding, Lawson's early entry strategy may
play well into this adoption phase on the condition it can weather the
We generally recommend including Lawson in a long list of an enterprise
application selection to mid-market and low end tier 1 companies (with
$100M-$2B in revenue), based on a very deep understanding of customers'
needs within the following industries: Financial Services; Healthcare;
Professional Services; Public Sector; Retail; Wholesale Distribution;
seeking a Web-based solution and out-of-box functionality with little
or no re-engineering effort may benefit from evaluating Lawson's ASP offering.
Support, connectivity, ease of use, security, acceptance, and scalability
are only a few regular considerations.
the current Lawson's users of its traditional client/server product should
not be anxious about the future product support, they may benefit from
informing themselves what would the ramifications of switching or not
to the ASP mode be.
with a substantial manufacturing activity (for which Lawson does not offer
a native solution) and companies with more intricate business processes
may want to inquire how Lawson would deal with the issues of customizations
and 3rd-party products bundling in an ASP setup.
for the new added CRM functionality through the partnership with Siebel,
users are advised to ask for firm assurances on the availability and future
upgrades timeframes, and more detailed scope of combined product functionality.
Also, make sure that Lawson offers a single contract and help desk for
all disparate components of its product offerings.
This article has been modified from it's original form since the original