Lotus Leans on IBM for Channel Direction

Last month came the second development, a shift in Lotus' Professional Services business that effectively removed general IT consulting from the software maker's operations. Lotus renamed its services group IBM Software Services for Lotus and said that the organization would focus on deployment of Lotus products, especially new technology, while consulting and integration work would be turned over primarily to solution provider partners.

"Overall, it's been viewed as a positive move by our business partners," says Ken Bisconti, vice president of worldwide channels and alliances for Lotus. "The new services group wil help pave the way for some of our business partners to take advantage of new Lotus technology and solutions, like e-learning."

The question of how these events will change Lotus' channel business is still largely unanswered, primarily because the changes are still in the early stages, but IBM will continue to play a pivotal role in that answer. For example, bringing Lotus into PartnerWorld and tying applications such as Notes and Domino closer to IBM's middleware brands, DB2 and WebSphere, has produced tangible results. Lotus officials say the company has approximately 13,000 business partners selling Lotus products, twice the amount of resellers Lotus had before it joined PartnerWorld. Bisconti says Lotus partners wanted a clearer path to take advantage of IBM's vast resources, while IBM partners wanted to leverage Lotus' popular e-mail and groupware applications.

"We started seeing some spillover from VARs who started out selling other brands in the IBM Software group," Bisconti says. "It would be unfair to say there was no angst or fear from Lotus partners about being moved into PartnerWorld. However, I think most have realized they can benefit from the broader range of software products."

As for the services shift, Lotus officials say the change will open doors for new partners, although the company isn't sure how many. Steve Robinson, director of IBM Software Services for Lotus, says the company was too focused on consulting services in the past, which led to channel conflict.

"We were competing heavily with IBM Global Services and our partners and we were doing some damage to our channel," Robinson says.

Now that the number of business partners has essentially doubled in the last year, Lotus will concentrate on forming key alliances with larger technology companies while continuing to use IBM Global Services to drive major deals in the enterprise space.

"Were going to try to reach out to the large integrators, Big Five consulting firms and ISVs that want to couple their applications with Lotus products," Robinson says.

Lotus still has a lot of work cut out for it in terms of molding its channel strategy. Bisconti admits that the company has to do a better job of communicating with its large number of resellers and solution providers and help them work more optimally within PartnerWorld and the IBM system.

"The majority of these partners don't know the richness of the resources available to them," Bisconti says.

There is also the question of where smaller solution providers focused on the mid market will fit into Lotus' future. Alliances with large integrators will be aimed at the enterprise, as is IBM Software Services for Lotus. Robinson says Lotus will be even more dependent on business partners to reach small and midsize business customers now that the company has moved away from IT consulting. Whether this will translate into new opportunities for resellers in the SMB space remains to be seen.

"We hope the strategy allows us to keep a vibrant number of partners," Robinson says. "Time will tell if the number grows."