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News In Review

September 7, 1998


Priority: Mail

More than ever before, companies rely on E-mail to perform crucial business functions

By Justin Hibbard

E -mail, perhaps the most popular desktop application, is taking on a bigger role in many companies' IT infrastructures. Because of its ubiquity, E-mail is being tied into the systems that run the business-data warehouse, enterprise resource planning, manufacturing, and Internet commerce applications-in addition to being extended to critical functions such as customer support. Instead of being pushed aside by new technology, E-mail is integrating with it.

"In the short period of a few years, it's amazing how dependent the user community has become on E-mail, not only internally but externally through the Internet," says Hugh Allen, manager of IT at Dunlop Tire Corp. in Amherst, N.Y. "Of all the applications we have, ERP and other major things, E-mail is No. 1. It's strategically important to the company."

At the same time, the market for client-server E-mail systems, once a hodgepodge of big and small vendors, is coalescing around two major players: IBM's Lotus Development Corp. and Microsoft. As they grapple for market share, the two keep one-upping each other in extending the features and functions of their systems. Last week, Lotus introduced tools that link its Domino server and Notes client to SAP's popular R/3 application suite. This week, at its Microsoft Exchange Conference, Microsoft will give a sneak peek at its next-generation messaging product, which will let companies develop workflow applications that cross organizational boundaries.

Users are eager to exploit messaging's potential, especially to improve customer contact. Dunlop Tire uses its Lotus Domino messaging system to respond to about 50 messages per day from customers who visit the company's Web site. "It's really important to respond effectively to those customers," Allen says.

House Bound
In June, the company started taking orders from tire dealers over an extranet based on Domino. The company tapped Ikon Office Solutions/Technology Services, a Lotus service provider, to link its Domino server to its order-entry system from Lawson Software. Dealers access the system through a Web browser, enter orders in a Web page, and submit the orders to a Notes/Domino database. Orders pass from Domino to the Lawson system through a custom interface.

Last year, Ikon developed a sales-force automation application for Dunlop by linking the company's Domino server to an Oracle database that houses Dunlop's sales analysis data mart. By giving salespeople access through Notes clients to all of the customer information they need, the application allowed Dunlop to relocate most of its sales force to home offices, close regional sales offices, and save about $2 million. "The project had a big impact on our company," Allen says.

That aggressive use of messaging is spreading. Lawn-mower maker Snapper Inc. has begun implementing a sales-force automation application based on Microsoft Outlook and Exchange that the McDonough, Ga., company will roll out to 4,000 users early next year. Salespeople use Outlook to look up and enter information about sales, order status, and shipments. Orders submitted to Exchange are passed to a Microsoft SQL Server database, which feeds data to Snapper's manufacturing software, System 21 Manufacturing from JBA.

Invoices go directly into the SQL Server database, which generates reports that get passed back out to the salespeople, says Howard Jones, Snapper's director of MIS. On a daily basis, salespeople get updates of inventories, production, and shipments, all passed through Exchange as E-mail or HTML reports. "Before, all the reporting was by hand, faxes, or phone calls," says Jones.

CUNA Mutual Group, a financial services company in Madison, Wis., uses a custom application to pull data out of E-mail messages sent by field representatives. That data is then used to update tables in its IBM DB2 database. The custom app also notifies headquarters by E-mail when the database needs to be updated manually.

In April, CUNA finished migrating 1,000 users of Lotus' cc:Mail and 4,000 users of IBM Profs and Verimation MEMO to Notes and Domino. The company picked Domino mainly for its groupware capabilities, says Ed Bernhardt, IT services sales and marketing project manager. CUNA uses Domino for threaded discussion among the field reps. "We wanted to provide applications to let field reps share information across the country," says Bernhardt. "Communication to the field is a big issue. We want to make sure they're always plugged in."

E-mail started out as simple asynchronous communication over mainframe systems, exemplified by IBM's Profs. LAN-based systems, such as Lotus cc:Mail and Microsoft Mail, ran on PCs but added little functionality. Over the years, though, messaging has become more sophisticated by incorporating scheduling and workflow capabilities, calendaring, and threaded discussions. Lotus Notes/Domino is a full-blown groupware system, incorporating sophisticated database replication. Microsoft has evolved its E-mail strategy into the Exchange server and Outlook client, which offer much of the same functionality as Domino and Notes.

The Future Of Exchange
Microsoft this week will preview the next version of Exchange server, code-named Platinum, which will let companies develop workflow applications that cross organizational boundaries. Platinum, which will ship in the third quarter of next year, will recognize certificate IDs from users outside a company as well as inside. Electronic forms sent to outside users will adhere to the same security constraints and business rules as those sent to inside users.

Last week, Lotus unveiled four tools to tie Domino to SAP R/3. Domino Workflow Integration for SAP R/3 makes R/3 workflow information available to Domino users; Domino MTA for SAP R/3 lets SAPOffice users and Domino users exchange E-mail; Domino Connector for SAP R/3 synchronizes data between Domino and R/3 servers; and enhanced LotusScript Extensions for SAP R/3 let developers customize data integration between Domino and SAP R/3 applications. Lotus will introduce tools that connect Domino to other ERP systems later this year.

Lotus is the messaging leader, with an installed base-including cc:Mail users-of almost 40 million, according to the newsletter Electronic Mail and Messaging Systems. But Microsoft is gaining ground. Exchange outsold Domino over the last six months, according to the newsletter, with 3.6 million copies of Exchange sold in the second quarter alone, compared with Lotus' 3.1 million copies of Domino. "This is evidence that the strong momentum behind Exchange continues to grow," says David Malcolm, group product manager for Exchange.

"I won't deny that Microsoft has made a lot of noise, and they definitely have gained momentum," says Jeff Papows, CEO at Lotus. "But Lotus still has double what they [Microsoft] have."

But for how long? Lotus is phasing out cc:Mail, and it's urging cc:Mail users to migrate to Domino. But other messaging vendors are eyeing those users as well. "Everyone is lusting after the cc:Mail base," says Matt Cain, an analyst at Meta Group Inc.

Ironically, cc:Mail's very first customer will begin migrating its 2,000 users to Exchange on Jan. 1. Alza Corp., a $464 million pharmaceutical firm in Palo Alto, Calif., invested seed money in PCC Systems, the company that developed cc:Mail before selling it to Lotus. Alza flipped the switch on its cc:Mail system in 1985 and remained loyal until this summer. "It's been a tough decision because I've been a cc:Mail loyalist for years," says Mary Beth Boyle, director of IT operations at Alza. About 300 Alza employees use Notes for collaborative applications, and the company will keep those users on Notes when it migrates to Exchange because Boyle believes Microsoft's product still falls short as groupware.

Picking Up Speed
The dark horse in the race is Novell, which claims its GroupWise messaging system is picking up market share from the cc:Mail installed base, especially among companies that run cc:Mail on its NetWare operating system. The company said last week that it has sold 2.5 million GroupWise licenses this year, bringing its total installed base to 13 million.

Last week, Novell shipped GroupWise 5.5, which adds document management, calendaring and scheduling enhancements, and native Internet addressing. Meijer Inc., a $7 billion grocery chain in Grand Rapids, Mich., will roll out the package to 16,000 users by year's end. Previously, the company used IBM's Profs, and it considers the GroupWise feature set a good replacement. "GroupWise provided for 98% of our needs right out of the box," says Jason McLellan, team leader and technical specialist at the company.

But some companies want more. Shell Chemical, for example, is using messaging as a supply-chain system. Shell has a custom application based on Domino and SAP R/3, called Simon, with which it manages its customers' inventory. Shell's customers enter the amount of chemicals they use in a Web-based form and submit the information to a database on the Domino server. Each night, the information is synchronized with Shell's R/3 system. When a customer's inventory drops below a certain level, R/3 automatically triggers a shipment to the company.

The next step is to use Lotus' Domino Connector for SAP R/3 to make Domino and R/3 exchange data in real time, says Kay Burns, manager of the SMI solutions group at Shell Services International Inc., the IT services subsidiary of Royal Dutch/Shell Group. With real-time capabilities, Burns envisions extending Simon to Shell's suppliers and to its customers' customers. "We're trying to spread it on down the chain," she says. If the idea catches on, it won't be single companies running on messaging, but entire industries.

--with additional reporting by Eileen Colkin and Gregory Dalton


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