Impact on IBMs Software Brands
Impact on IBM's Software Brands Speaking on how the software realignment impacts the IBM Software brands-Tivoli, Rational, WebSphere, Information Management (DB2 and more), and Lotus-LeBlanc said the IBM Software brands represent a market space, but IBM tends to think more in terms of capability and tries to orient itself around capability."So you'll see us talk more about IBM Software rather than the brands," he said. "That part's all under me. We've been working on this organization design for 18 months. It's not something we thought of overnight. When I came back to software, Steve [Mills] and Sam [Palmisano, IBM chairman and CEO] both sat me down and said, 'We need you to help us think through what does the next generation of our software business look like?' Because we grew by $10 billion. Well, we want to grow by another $10 billion." Both LeBlanc and Rhodin have held several leadership positions inside IBM prior to their new roles. LeBlanc was most recently head of worldwide software sales and marketing at IBM and has held other positions such as head of IBM Global Business Services' (GBS') Global Consulting Services and head of SOA and WebSphere. Rhodin was most recently head of IBM's overall operations in Northeast Europe, and also formerly ran IBM's Lotus division. Rhodin said his experience in Europe, where he was in charge of all of IBM's businesses, from its services business to its hardware and software businesses, "really helped me to understand what IBM can bring to the table when we put all the pieces to together. And I think this new group is going to allow us to bring more and more of IBM's industry dimension to the table as we start to cast the solutions in the context of what business our clients are working in." Rhodin said IBM is looking at the solutions space as a "very high growth segment. We think that by putting more senior management talent over the focus of delivering this, we can get more attention faster in this space. And I think we've got a very interesting point of view here. We've been developing solutions with clients for a very long time. We started the work around industry frameworks almost a decade ago. And they started maturing over the course of the last 10 years." Rhodin said he was part of the group that put together IBM's first industry framework for the telecommunications industry. Moreover, a key goal of the solutions group is to help give IBM customers flexibility to build and deploy systems faster, Rhodin said. "They're looking for more flexibility to include the investments they've made historically, so it's not a rip and replace model," he said. "And we think our approach to using an underlying service-oriented architecture allows us to bring all those pieces together that a client already has" and then enable them to focus on their more specific problems. As LeBlanc noted, analytics falls under Rhodin's unit in addition to collaboration. Indeed, Rhodin spelled it out:
"It's all around IBM software," he said. Indeed, more than 10 years ago when IBM more or less initiated its software brand structure, the company had very specific competitors in the different areas. But now the company's competition is much broader and more encompassing, LeBlanc added.
"We look at a lot of core capabilities like collaboration, like analytics almost as a substrate that becomes an important element of a lot of these industry solutions. With collaboration and its focus on improving efficiency of employees in an organization, or on creating social networks across the boundaries or organizations as a way of improving the productivity of teams. And then analytics we think is one of the brightest opportunities on the horizon right now-helping people turn information into insight and then using that insight to actually deliver a better outcome. If we can pull that off, I think we can do some interesting things. I've always been a very innovation-focused participant in our software business. And I think the raw material here is pretty exciting."Henry Morris, an analyst with IDC, gave eWEEK his view of the IBM software realignment:
"The big gap in IBM's portfolio is its lack of an enterprise applications unit. Oracle and Microsoft made acquisitions in ERP, CRM and related application software. IBM did not move in this direction. This meant that, for example, Oracle could move J.D. Edwards and PeopleSoft customers to the Oracle middleware stack, though both of those companies were closely tied to IBM WebSphere at the time they were acquired. The ostensible reason for this was that IBM did not want to compete with its partners who built applications on top of the IBM stack. The new Solutions division is as close as IBM has come to forming an application division, bringing together its Lotus, Cognos, SPSS, Filenet assets for collaboration, analytics and enterprise content management with the charter to build out solutions (i.e. 'applications') both horizontal and vertical-specific. The Middleware division houses IBM's established offerings in database, infrastructure and app development."