Will IBM's Big Bet on Services-Oriented Applications Pay Off?

IBM made an announcement in February perhaps only it could pull off -- a trumpeted launch of a new package of products and services targeting information management under the umbrella of "Information On Demand."

IBM made an announcement in February perhaps only it could pull off — a trumpeted launch of a new package of products and services targeting information management under the umbrella of "Information On Demand."

It's hard to get past the glitter of bigger-than-life technology marketing speak, but in promising to invest $1 billion and employ 25,000 people in the effort over three years, IBM signaled this is more than one of the company's periodic rebranding exercises. In fact this is IBM's most substantive move to date into the high-stakes competition for who will deliver the next round of services-oriented enterprise applications.

The next generation of enterprise applications will be developed as knowledge-driven applications, very unlike familiar data-driven applications. With no appetite among global businesses to repeat the frustrating overspend of the ERP era, the new knowledge-driven applications will be focused on business context, domain expertise, flexible task environment support and just-in-time information delivery.

In the new initiative, IBM is bringing together the resources required for SOA (service-oriented architecture)-based, knowledge-driven applications into a single program. Its Business Consulting divisions will contribute industry domain expertise and industry-oriented best practices. IBM Software and IBM Research will offer newly integrated software arrayed in specific application bundles (such as a master data management configuration or a workforce productivity configuration). Planned Centers of Excellence will unite business people, implementation expertise, research and development, and quality assurance.

On the technology side, IBM announced three new product configurations: a Content Discovery Server available immediately (this is the "blue washed" iPhrase technology acquired in late 2005); an Entity Analytics package (a new rev and packaging of entity and relationship analytics for DB2, due to be released in the second quarter); and a new Information Server (based on the March 2005 Ascential acquisition, also due in the second quarter). Brand new functionality is not the theme; instead the message is that IBM has taken care of much of the software integration burden for knowledge-driven applications. These products now share elements of the WebSphere infrastructure and can more readily leverage such preconfigured elements as process models and data models built with other IBM utilities.

The ambition in this vision is striking, but the devil, as usual, will be in the details. Even armed with new SOA technology and arguably industry-leading expertise, IBM won't soon be able to deliver on this vision except for restricted business problems, such as insurance claim fraud (an application IBM has created for Rockland County). To succeed, the new IBM information management program must do more than align ever-larger portfolios of IBM middleware and consulting around building custom systems. That path was rejected in the ERP era and isn't an appropriate response to the enterprise's need for agility and innovation — unless your business can tolerate a three- to five-year change cycle. But if IBM can speed up its delivery of applications and services, and produce knowledge-driven apps on the fly, it may change the enterprise software playing field.

— Hadley Reynolds, VP and director of research, Delphi Group

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