IBM Will Flex Financial Muscle In Cloud, Analytics, Outsourcing

Flexing its considerable financial muscle in strategic categories, IBM says it "will leverage our cash position to be opportunistic to accelerate our progress" in cloud computing and business analytics, while also reporting a whopping 50% jump in signings for long-term strategic-outsourcing deals in the financial-services sector.IBM CFO Mark Loughridge cited cloud computing and business analytics as two of the company's four strategic initiatives for 2009, and noted that a third is its willingness to use its extensive financial power to drive those new businesses vigorously in these uncertain times when many IT vendors are pulling back.

Defining business analytics as optimizing clients' business performance by applying analytics to their business processes, Loughridge told a meeting of financial analysts that IBM expects to be able to help customers make better decisions in less time. Among early adopters of the new initiative from IBM are TD Bank, MTN South Africa, the New York State Department of Tax, and The Sentinel Group.

Both the analytics effort as well as IBM's enhanced commitment to cloud computing will require not only the financial resources the company says it will unleash, but also strategic expertise in such areas as enterprise software, deep industry-process knowledge, and solutions integration.

Loughridge didn't mince words when he said that IBM is jacking up the stakes for any other players in those and other sectors that IBM believes will be essential for future growth: "And we will leverage our cash position to be opportunistic to accelerate our progress in the areas we believe will fuel growth and competitive differentiation in the future."

And in the battered financial-services sector, Loughridge indicated that many such companies are turning over more of their infrastructure operations to IBM to handle, noting that within the financial-services sector, long-term signings for the company's Strategic Outsourcing business were up 50% in the recently completed first quarter.

There's no secret to that development, he said: the "compelling value proposition" for clients is "a lower cost base and better variability."