Software // Information Management
Commentary
11/9/2007
09:59 AM
Mark Smith
Mark Smith
Commentary
Connect Directly
RSS
E-Mail
50%
50%
Repost This

IBM Software Group: Visionary, Conservative or Just Stubborn?

In areas like BI and IT management, you can't consider IBM as your strategic supplier, so you have to look elsewhere or count on consulting services to fill in product and technology gaps. IBM has a lot more potential, as even IBM executives recognize, so it has to determine if it can ignore these markets. Will IBM step up and acquire more companies, or will it build new products to fill these voids? Either way, I think it's time they fill a few strategic needs.

This year's IBM Software Group Global Industry Analyst Summit brought the traditional annual update of the company's progress this year and its direction in the year ahead. Led by the head of the Software Group, Steve Mills, the event focused on the theme of integration from business to IT and across the software reference architecture of IBM products. This whole area is clearly a continuing challenge for most IT organizations and the technology landscape is becoming more complex. Integration is at the core of IBM's approach, and the company capitalizes on a very strong portfolio of middleware and services. With dozens of product releases this year and a lot queued up for 2008, IBM is one the software companies that you have to watch.

IBM's Software Group is very profitable and it has grown consistently, thanks in large part to more than 50 technology supplier acquisitions since 2000. These acquisitions have blended into the existing IBM software brands of Lotus, Tivoli, WebSphere, Rational and Information Management, and the company continues to drive new capabilities and introduce technology innovations. IBM is clearly a very large and dominant provider of application, collaboration, data management, and middleware technologies that compete with those from large providers like HP, Microsoft, Oracle, SAP and plenty others. Despite heated competition from a array of software providers large and small, IBM is still very conservative about talking up any technological advantages it may have in the market. Touting size and stability as a strength is a good start, but it would round out the company's position if executives could articulate why IBM's products and approaches are superior to those of other vendors in terms of capabilities and architecture.What we industry analysts do is research the needs of IT and business and then assess what providers like IBM are doing or not doing to meet those needs. IBM presents an impressive software portfolio and strong brands but it's not always the most progressive vendor in the market. IBM has a tendency to take either a very high-concept approach to markets or a technology/product-up perspective without truly addressing the pragmatic top-down CIO/IT management role and requirements for supporting line-of-business functions.

In some technology segments, such as business intelligence, IBM is quick to discount the needs of organizations. According to IBM, BI is either just desktop reporting or applications that they don't plan to address. BI wasn't even discussed at the analyst summit, which is amazing considering that its strategic importance is pretty clear. With the last year of consolidation in BI, how could you ignore it?

Data warehousing appliances, like those from Teradata, Netezza and now even HP, are diminished by IBM software executives as toasters, and they claimed many times in 2007 that this is not an important area of focus. Meanwhile, IBM has a pre-packaged appliance approach called Balanced Warehouse. Are you confused? I am, and so, too, are the hundreds of organizations that have spent a significant amount of time and money on appliances. I remember Larry Ellison commenting in the mid 90's that Teradata was a mere passing fad, but that is clearly not the case.

In the area of IT management, IBM is focused on brands like Tivoli for operations and Rational for development life-cycle, but it lacks a strategic, top-down approach for providing software for overall IT management responsibilities, as found in HP, PlanView and others.

So what does this mean for you? Well, in some of these areas, you can't consider IBM as your strategic supplier, so you have to look elsewhere or count on consulting services to fill in product and technology gaps. IBM has a lot more potential, as even IBM executives recognize, so it has to determine if it can ignore markets that are strategically important to IT management. Will IBM step up and acquire more companies, or will it build new products to fill these voids? The company has taken both approaches over the years, but either way, I think it's time they fill a few strategic needs.

IBM is visionary, conservative and stubborn, but perhaps it has won the right to be that way given its success. It's clearly a software force to be reckoned with. With advancements in collaboration, service management, information management and application platform capabilities with SOA in the year ahead, stay tuned for a stronger and hopefully more aggressive IBM in 2008.

Mark Smith is CEO And Senior Vice President of Research at Ventana Research. Write to him at mark.smith@ventanaresearch.com.In areas like BI and IT management, you can't consider IBM as your strategic supplier, so you have to look elsewhere or count on consulting services to fill in product and technology gaps. IBM has a lot more potential, as even IBM executives recognize, so it has to determine if it can ignore these markets. Will IBM step up and acquire more companies, or will it build new products to fill these voids? Either way, I think it's time they fill a few strategic needs.

Comment  | 
Print  | 
More Insights
The Agile Archive
The Agile Archive
When it comes to managing data, donít look at backup and archiving systems as burdens and cost centers. A well-designed archive can enhance data protection and restores, ease search and e-discovery efforts, and save money by intelligently moving data from expensive primary storage systems.
Register for InformationWeek Newsletters
White Papers
Current Issue
InformationWeek Elite 100 - 2014
Our InformationWeek Elite 100 issue -- our 26th ranking of technology innovators -- shines a spotlight on businesses that are succeeding because of their digital strategies. We take a close at look at the top five companies in this year's ranking and the eight winners of our Business Innovation awards, and offer 20 great ideas that you can use in your company. We also provide a ranked list of our Elite 100 innovators.
Video
Slideshows
Twitter Feed
Audio Interviews
Archived Audio Interviews
GE is a leader in combining connected devices and advanced analytics in pursuit of practical goals like less downtime, lower operating costs, and higher throughput. At GIO Power & Water, CIO Jim Fowler is part of the team exploring how to apply these techniques to some of the world's essential infrastructure, from power plants to water treatment systems. Join us, and bring your questions, as we talk about what's ahead.