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    IBM Launches Cognitive Business Solutions Unit

    Written by

    Darryl K. Taft
    Published October 6, 2015
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      Taking advantage of learnings from its experience with its Watson cognitive computing system, IBM today launched a consulting organization known as IBM Cognitive Business Solutions.

      IBM CEO Ginni Rometty announced the new initiative today at the Gartner Symposium in Orlando, Fla. IBM Cognitive Business Solutions taps into IBM’s success with Watson and analytics and draws on the expertise of more than 2,000 consulting professionals spanning machine learning, advanced analytics, data science and development. Supporting these professionals are industry and change management specialists that will help to accelerate customers’ journeys to move to cognitive business.

      Cognitive computing represents an entirely new model of computing that includes a range of technology innovations in analytics, natural language processing and machine learning. Industry analyst firm IDC predicts that by 2018, half of all consumers will interact regularly with services based on cognitive computing.

      IBM is looking at its Cognitive Business initiative as the successor to the company’s previous strategic initiatives, including e-Business and Smarter Planet. As with e-Business in 1995, and Smarter Planet in 2008, this initiative will drive everything the company does, IBM said.

      “This touches every part of IBM, and every IBMer will be dedicated to it—from embedding intelligence in our products and services and collaborating with thousands of clients and partners, to making IBM itself the premier example of a cognitive enterprise,” said John E. Kelly III, senior vice president of IBM Research, in a blog post on the move to cognitive.

      With e-Business, it was about the internet transforming business. That was former IBM CEO Lou Gerstner’s vision. Smarter Planet was based on new opportunities created by the world becoming instrumented, interconnected and intelligent.

      However, now two things are happening. The first is that big data has exploded as a challenge and an opportunity, and the second is that there is an emergence of a wide range of cognitive technologies that move IT’s potential to a new level. About 80 percent of all the available data–images, voice, literature, chemical formulas, social expressions, etc.—is out of reach for most companies to analyze. IBM, along with some others, is scaling expertise to close that gap. That is why IBM built and acquired technology to continually enhance Watson to be able to do things like “see.” That’s also part of why IBM spent $1 billion to acquire Merge Healthcare in August.

      “Whether this becomes the ‘next big thing’ for IBM depends on a lot of factors,” said Charles King, principal analyst at Pund-IT. “I believe that the company has made a continuing, strong case for the technological innovation of its cognitive developments and solutions. But I also think that the success of those offerings will depend in large part on how well businesses and end users understand the value that cognitive tools and processes offer. If IBM can effectively deliver on its promises enabling ‘citizen’ data scientists, cognitive computing could very well become as big or bigger than e-Business and Smarter Planet.”

      IBM’s vision for cognitive builds on Smarter Planet, with big data and intelligence driving this new chapter of IBM’s transformation. Now cognitive business can be applied to everything from healthcare to retail and sports, and IBM can help clients transform by becoming cognitive businesses.

      Indeed, IBM’s efforts with cognitive business build into Smarter Planet and actually does a better job of addressing the “smarter” part, said Rob Enderle, a longtime IBM watcher and founder of the Enderle Group.

      “Much of Smarter Planet was about instrumentation, but it lacked the intelligence to really drive decisions automatically from the data gathered,” Enderle said. “This initiative adds the intelligence part effectively making Smarter Planet more real and certainly more achievable. The big problem with big data was the huge focus on acquiring data and the lack of focus on making sense of it. This latest effort is focused on the ‘making sense’ part and is critical to actually getting positive results from these incredibly expense big data projects. In the end this is a critical step to taking business and government towards making their big data efforts pay back the huge investments that have been made in this space.”

      A survey of more than 5,000 C-suite executives to be released this fall by IBM’s Institute for Business Value (IBV) finds that executives from the highest-performing companies place significantly greater priority on cognitive capabilities than peers in market-following enterprises.

      IBM Launches Cognitive Business Solutions Unit

      “Our work with clients across many industries shows that cognitive computing is the path to the next great set of possibilities for business,” said Bridget van Kralingen, senior vice president of IBM Global Business Services, in a statement. “Clients know they are collecting and analyzing more data than ever before, but 80 percent of all the available data remains out of reach for traditional computing systems. We’re scaling expertise to close that gap and help our clients become cognitive banks, retailers, automakers, insurers or healthcare providers.”

      The IBV research shows that 65 percent of industry CXOs are pursuing some form of business model innovation, but nearly 30 percent feel the quality, accuracy and completeness of the data in their organization is insufficient. Nearly all said they intend to invest in cognitive capabilities. In retail, 60 percent of executives said they do not believe their company is equipped to deliver the level of individual experiences consumers demand, and 95 percent say they will invest in cognitive in the next five years. And in healthcare, the industry forecasts a 13 million person gap in qualified healthcare workers by 2035, and more than half of healthcare industry CXOs report that current constraints on the ability to use all available information limits their confidence about making strategic business decisions. Eighty-four percent of these leaders said they believe cognitive will be a disruptive force in healthcare and 95 percent plan to invest in it over the next five years.

      Across all industries, executives surveyed by the IBV cite the scarcity of skills and technical expertise as the primary barriers to cognitive adoption—surpassing concerns about security, privacy or the maturity of the technology.

      IBM said its consultants are prepared today to bring clients “get started” offerings and readiness assessments that create low-cost entry points to begin the journey to become cognitive enterprises.

      “Before long, we will look back and wonder how we made important decisions or discovered new opportunities without systematically learning from all available data,” said Stephen Pratt, global leader, IBM Cognitive Business Solutions. “Over the next decade, this transformation will be very personal for professionals as we embrace learning algorithms to enhance our capacity. For clients, cognitive systems will provide organizations that adopt these powerful tools outperform their peers.”

      IBM already has been working with customers to help them become cognitive enterprises. For instance, for a major retailer, IBM developed a cognitive solution that analyzes the client’s data in the context of information from multiple external sources—including local weather and up-to-the-minute social sentiment—to sense deviations in demand for selected products, make recommendations in areas from replenishment to pricing and dramatically improve demand forecasting.

      In another example, the cognitive systems of a leading provider of consumer insurance use Watson natural language capabilities to answer questions and provide advice about the company’s products and services to create a more compelling online experience.

      IBM also is working with healthcare organizations to apply cognitive computing technology in genomics to advance cancer care by accelerating DNA analysis for personalized treatment options. In financial services, IBM is working with clients to apply cognitive to better manage risk and provide personalized guidance and investment options. And in education, cognitive technology is being used to personalize academic instruction and enhance academic experiences for students and teachers.

      IBM’s analytics professionals have amassed more than 50,000 engagements for customers. The company has a force of thousands of data and analytics experts across IBM Research, and the company’s Analytics and Watson solution units, along with more than 30,000 professionals in IBM’s Strategy and Analytics consulting organization.

      IBM’s new Cognitive Business practice also will draw upon the computational reasoning and learning capabilities of IBM Watson, which represents a $1 billion investment to advance cognitive innovations across industries. IBM will train another 25,000 IBM consultants and practitioners on cognitive computing this fall.

      “IBM’s continuing expansion of its cognitive business seems like a good move to me,” King said. “First, it’s a natural outgrowth of the sizable—more than $25 billion—investments the company has made in analytics technologies over the past decade or so. Second, it has made good use of unique IBM technologies and assets—hardware, software, R&D and, with this latest announcement, the company’s services organization and offerings.”

      Darryl K. Taft
      Darryl K. Taft
      Darryl K. Taft covers the development tools and developer-related issues beat from his office in Baltimore. He has more than 10 years of experience in the business and is always looking for the next scoop. Taft is a member of the Association for Computing Machinery (ACM) and was named 'one of the most active middleware reporters in the world' by The Middleware Co. He also has his own card in the 'Who's Who in Enterprise Java' deck.

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