Indian Retailer Chumbak Taps IBM Cloud for ERP Systems

IBM's $10 billion cloud unit continues to move aggressively, inking a deal with Indian retailer Chumbak to power its ERP systems.

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IBM announced that Chumbak, a large lifestyle products retailer in India, has chosen IBM Cloud to support its business processes as the company positions itself for accelerated growth.

The retailer said IBM's cloud computing environment will enable Chumbak to better manage its critical data across multiple locations. As part of the agreement, Chumbak will host and run its enterprise resource planning (ERP) applications on IBM Cloud.

Chumbak offers a wide range of products across an assortment of apparel, home and accessories. The company runs over 40 stores across India and also has large format flagship stores in six cities, IBM said.

"Over the last five years, Chumbak has grown over 300 percent year on year," said Rajath Kedilaya, CIO of Chumbak, in a statement. "As we plan to scale our presence both online and offline, we wanted a technology partner who could support us over the next phase of our hyper growth. The IBM Cloud Infrastructure as a Service, with its unique combination of virtual and bare metal features, has helped us streamline our operations seamlessly."

IBM said Chumbak plans to increase its large format store count across the country and is also preparing for strong growth in its online business. Given the rapid scale of expansion, Chumbak needed an IT infrastructure that could scale up adequately to support the anticipated growth. Among the factors used to evaluate the options was the requirement for seamless integration with the ERP system. Cost-effectiveness and performance efficiency rounded out the top three requirements, IBM said.

"While evaluating the IT partner for our requirement, we considered Microsoft Azure and AWS as well," Kedilaya added. "But in the process we realized that IBM Cloud offered the most cost-effective solution and could be deployed and integrated seamlessly with our ERP infrastructure. Also, the bare metal feature is a unique offering that provides on-demand access to the right resources for the right workloads."

With more than 40 global cloud data centers, IBM provides companies with public, private and hybrid cloud services to help them digitally transform their businesses.

"Today, enterprises require their IT infrastructure to enable them to enhance business performance, spur innovation and get better insights into complex supply chains and distributed development environment," said Vivek Malhotra, cloud leader at IBM India, in a statement. "Chumbak also required a holistic approach to manage their IT infrastructure. IBM not only proved to be the IT backbone of the organization but also reduced Chumbak's overall IT services costs significantly."

IBM's deal with Chumbak comes just after Big Blue announced that its cloud unit is now a $10 billion business. As one of its strategic imperatives—cloud, analytics, mobile, social and security—IBM's cloud unit is helping to lead the way in the company's transformation.

In 2015, IBM's strategic imperatives revenue grew 26 percent—adjusting for currency and the System x divestiture—to $28.9 billion and now represents 35 percent of total IBM revenue. Total cloud revenue grew 43 percent to $10.2 billion, up 57 percent; cloud-delivered as-a-service revenue grew 50 percent to $4.5 billion; business analytics revenue grew 7 percent to $17.9 billion; mobile revenue more than tripled; and security revenue grew 5 percent.

"Our strategic imperatives continued strong performance, up 26 percent for the year," said Martin Schroeter, IBM's senior vice president and chief financial officer. "This now represents 35 percent of IBM's revenue. Our profit and margin reflect our portfolio actions as we shift to higher value, as well as the level of investments we're making to drive our transformation."

Schroeter spoke of how large companies with many applications and processes are looking to IBM to drive broad-based transformations to the cloud. This underscores how the intersection of analytics and cloud continues to play to IBM's strength, and how hybrid cloud is emerging as a major bet for businesses, he said.

Schroeter also noted that IBM recently signed a $1.5 billion cloud services deal with European Bank BNP Paribas, where the company will operate two of the bank's data centers in Belgium as hybrid cloud centers, and provide cloud infrastructure and a suite of transformation cloud services spanning applications testing, business intelligence, security and core banking solutions, in addition to big data analytics.