Putting Know-How Into Lotus' Knowledge ManagementPutting Know-How Into Lotus' Knowledge Management

It's no secret that Lotus Development Corp. is betting on knowledge management as it seeks new outlets for revenue growth. Nor is it a secret that it has to: It's a different world in the messaging market than it was just a couple of years ago, says Lotus CEO Al Zollar.

"The growth rates are certainly different than they were in the '97 to '99 time frame, when most enterprises were making a fundamental decision as to their corporate standard infrastructure for messaging and collaboration," Zollar said last week during an interview at Lotus' developers' conference in Las Vegas. And when there is new business to be won on that front, Microsoft fights hard to get it.

But Lotus is fighting hard to explain knowledge management--and its benefits--to the world. General Motors Corp.'s chief technical officer Tony Scott says the company, a long-time Lotus customer, is in the "early days" of testing Lotus' knowledge management platform, and he's pondering its ROI. Access to well organized, digital data is pivotal, he says, but "applied knowledge has always been more valuable then pure knowledge in a business sense."

IBM Global Services is helping deliver the payback message, although consultants spend most of their time on culture and strategy issues of knowledge management projects, not technology. Global Services works with Lotus and other vendors in the space but, says Tom Hawk, general manager of business innovation services at IBM Global Services, "We don't come at this from the tools, though we think we have some pretty good tools."

Lotus says it's working to improve those tools, too. Zollar talked about how new versions of Discovery Server may address one complaint about knowledge management software--that making the names of experts public to everyone could overwhelm the experts. In the future, people may be able to choose if they want to be considered an expert and who can contact them. "Right now there's a level of coarseness to it, and we think that we can add additional granularity," he says.

Meanwhile, IBM is taking Lotus more closely under its wing than it said it would five years ago, when it acquired the company, and even as late as last year. A year ago, when sales of Notes grew strongly during a lackluster first quarter for IBM, Zollar was still assuring customers and employees that an IBM veteran taking the CEO job did not mean that Lotus was losing independence. But the story changed as Lotus's revenue stalled, and IBM recognized it could cut expenses by eliminating duplicate positions at Lotus as well as build on the recent success of its own software business, which develops leading products such as the WebSphere application server.

Zollar says he wants to see tight integration happen. "It made no sense for Lotus to continue to have a separate set of entities around its go-to-market structure," Zollar says. Lotus still has a direct sales force for the brand, but in March it laid off nearly 200 sales and marketing employees. "We should integrate [operations] and be part of the IBM family of brands," he says, and learn to behave like a bigger company "in dealing with markets and customers as part of a unified strategy."

But there are some signs that the integration plan hasn't been entirely smooth. Some Lotus employees still appear to view themselves as separate from IBM. During a meeting at DevCon, for example, a product manager declined to give a timetable for the integration of QuickPlace and Sametime with WebSphere. "We're negotiating with them," he said, in reference to IBM.

Zollar also challenges the notion that companies can proceed with a knowledge management strategy before settling on a knowledge management technology. "You cannot do these sequentially," Zollar says. "You have to work on them in parallel because of the fact that they change each other."

That's a point of difference between Zollar and Laurence Prusak, head of the IBM Institute for Knowledge Management, a research group located across the street from Lotus--which was created jointly by IBM and Lotus. Prusak takes a different approach toward knowledge management, encouraging corporations to seek non-technical approaches such as restructuring their organizations to reward people for seeking and sharing knowledge and to give people time and a place to gather and discuss projects.

Nevertheless, analysts say that Lotus has taken the right course by targeting knowledge management, and that moving more closely into the IBM fold is also the right idea. "Knowledge management is definitely where [Lotus] needed to go in terms of their core product focus," says James Kobielus, analyst with The Burton Group. Knowledge management, in fact, leverages the shared objects and file store capabilities of Lotus' key Domino and Notes products, Kobielus says.

He adds that the acquisition of Lotus by IBM "has been a fairly harmonious pairing of two companies," or at least as harmonious as acquisitions can get in this industry. For instance, Kobielus says, IBM has made Lotus Sametime and QuickPlace important parts of its overall product mix and the larger company has largely integrated the Lotus products into its own WebSphere platform.

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