07:26 PM
Bob Evans
Bob Evans

Global CIO: As IBM Accelerates Analytics Business, Can Anyone Keep Up?

IBM has put analytics at the heart of its corporate strategy and is leveraging its entire $100-billion business to drive the "smarter" solutions that analytics animate.

It's not just the $14 billion IBM has invested in acquiring 24 analytics companies in the past four years.

It's not just that revenue for IBM's Business Analytics and Optimization unit are expected to double over the next five years to $16 billion from this year's $9 billion.

And the battle won't be won or lost on the fact that IBM in the past year has almost doubled to 7,000 its in-house roster of full-time business consultants specializing in applying analytics and optimization across multiple industries.

Or on the fact that IBM has 200 mathematicians and 10,000 software developers devoted exclusively to expanding and refining IBM's extensive product line for this high-growth business.

But when you put all those pieces together, and then add on top some of the customer testimonials IBM is compiling, it's clear that the game's going to get very tough out there for companies that don't have distinctly differentiated products, market segments, and solutions in the dynamic analytics market.

That's why yesterday's kickoff of IBM's Business Analytics Forum represents more than just the beginning of yet another industry event: I think we can look on it now, and will certainly look back on it later, as the beginning of a new era for how the IT industry defines analytics within our own closed confines.

More important, this is also a time when we are seeing critical masses of customers—including businesspeople as much or more so than CIOs—change their view of analytics from something that's fuzzy and impossible for non-specialists to understand, to a mainstream set of business tools that no companies can afford to be without.

Those customers are demanding that software providers like IBM demystify the weird science of analytics—witness the 200 mathematicians cooking up new algorithms—and make these essential products more consumable, more accessible, and more in line with the way people work today instead of being the province of eggheads through whom all analytics requests must flow.

And they are also demanding that the user interfaces for these new apps and the insights they offer enter the modern world of social media and collaboration tools, with those capabilities built-in rather than being cobbled together awkwardly after the fact.

Consider the forecasts IBM released this week:

--In three years, the global mobile workforce will reach almost 1.2 billion people.

--In five years, the volume of mobile transactions taking place will be 40 times higher than it is today.

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--This year alone, 30 billion RFID tags will be deployed in retail stores, hospitals, factories, supply chains, and other locations—and each of them will be blasting out huge volumes of data that powerful new sensors and systems will need to gather, digest, analyze, and distribute as appropriate.

As IBM noted in its materials kicking off its analytics event:

"Whether it is understanding customer buying patterns to increase sales, providing more efficient services to citizens or detecting critical health issues like severe brain injuries early, harnessing the power of information with real-time analytics is going mainstream."

What, then, does that mean for CIOs? Is this just more marketing fluff from the industry, or have we hit something of a watershed moment with IBM's rollout of Cognos 10, which IBM calls "the most significant analytics offering since the acquisition of Cognos, one of the largest acquisitions in IBM history."

That includes full support for Cognos 10 on the iPad and iPhone, in addition to its availability on other leading mobile platforms.

But details aside, the big deal for CIOs and their colleagues is that the cumulative impact of IBM's moves noted above will force every other software company—from the big guys like SAS to SAP to Oracle to the slew of highly promising and innovative smaller companies driving new approaches and new technologies—to bring their analytics products and technologies out of the labs, out of the ivory towers, and out of the exclusive domain of experts who may or may not give two hoots about business issues.

And, in turn, put those high-value analytics and optimization capabilities into the hands of mere mortals in sales and marketing and engineering and product development and service and finance—in short, into the hands of just about every knowledge worker in the organization.

Here's how IBM vice president for marketing and strategy for business analytics Mychelle Mollot described IBM's evolving approach to this new wave of mobile-social business users:

"This is huge—absolutely huge—because we know that with the arrival of this mobile workforce, we'll need to more than just support the specialists," Mollot said in a phone interview. "We'll need to be dramatically increasing our platform support as well, including iPad and iPhone support to add to what we have for BlackBerry and Symbian and Windows.

"And by support, I mean more than just for the devices—I mean allowing mobile people to be as productive in the field as they would be in the office."

Mollot said that by embedding Lotus Connections directly into the Cognos solutions, "we can help people to be collaborative around a decision by letting them put an annotation in and pass it around that that instantly becomes part of the corporate memory, right then and there.

"In turn," she added, "this can shorten the time to decisions and make people more productive and more likely to take action on what has just been discovered."

At the top of this story, I wrote a headline that says, "Global CIO: As IBM Accelerates Analytics Business, Can Anyone Keep Up?" In asking that, I'm not suggesting that IBM will dominate the analytics landscape, and would-be competitors should just take their stuff and go home.

Quite the contrary: the challenge today is for other companies to redefine their value propositions in this high-change part of the market, and to move even faster than IBM is moving in redefining analytics from arcane math-driven hypotheses to real-time, real-world business insights for every knowledge worker up and down the organizational chain.

And for CIOs, that means that the real race in analytics will not just be about powerful and elegant code, but rather about which software company can do the best job of making all that power come alive for huge numbers of your employees, your partners, and your customers.

Can you keep up?


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GlobalCIO Bob Evans is senior VP and director of InformationWeek's Global CIO unit.

To find out more about Bob Evans, please visit his page.

For more Global CIO perspectives, check out Global CIO,
or write to Bob at [email protected].

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