Home > IBM, information management, Microsoft, Oracle, SaaS, service oriented architecture, software industry, systems management > Five things I learned at IBM’s Software Group Industry Analyst Meeting

Five things I learned at IBM’s Software Group Industry Analyst Meeting

Every year at about this time I attend IBM Software Group IT Industry Analyst meeting. This meeting is attended by about 90 industry analysts and about three times that number of IBM software group leaders, managers, and support staff. It is quite the event! While I can’t possibly talk about everything I am hearing, but I will give you an overview of the events and some of the highlights.

Since I have been traveling to a lot of analyst conferences lately, I can compare the approach of different market leaders. Next week, for example, I will be at EMC’s analyst meeting and in early December I will attend SAP’s analyst event.

But I digress. Here is what I came away thinking about IBM and its software strategy. One of my first thoughts is to compare Microsoft’s SOA/BPM event the other week to IBM’s. One of the big differences is that while Microsoft is announcing new long term initiatives (Oslo) for SOA, IBM is executing on a long term plan that has been in the works for more than five years. I think the best way to understand IBM’s software DNA is to look at the perspective of its leader.

I start with an observation that is actually not new for me. Steve Mills, Senior Vice President and General Manager of the Software Group has been the force behind herding the multiple business areas within the software group to have a common set of underlying services. While this may make perfect sense, it not an easy achievement for a company with thousands of software offerings across hundreds of different business units. As an example, when I first met Steve he was grappling with a few hundred different data stores under hundreds of different products. Somehow he managed to get all of these groups to use DB2 as their underlying database engine. But that was just the start. Steve’s next big leap was to move out of the packaged software market and into the middleware and horizontal software market.





I thought Steve’s remarks were quite insightful: In essence, Mills pointed out that IBM’s focus with its horizontal software approach is on what he calls industry frameworks. With this approach he believes that IBM is armed with the right stuff to focus on what he calls “customer business outcomes.”

Rather than packaged software these frameworks are a combination of best practices and business services. For example, in the financial services industry these services would include financial services for payments platforms, high performance event processing, and large scale data mining and analytics. Therefore, the overarching strategy for the software business is to provide the building blocks that apply to business requirements across business domains.

Mills contents that the real benefit that customers are looking for is to gaining operational efficient and innovative business performance from this horizontal. He contends that the greatest benefit from a growth and cost containment basis comes from a focus on harmonizing business practices across the organization. Simply automating and re-automating vertical slides such as customer relationship systems, booking keeping, inventory, and the like not where the opportunity is. Could this be a swipe at companies like Oracle and SAP?


Like Microsoft, IBM is moving its focus to process and models-based approaches but with a horizontal flavor. Mills believes that transactions, messaging, information integration, management of an increasingly virtualized enviornment, data management, and collaboration are at the heart of the requirements to make this vision a reality. This is where IBM software is putting its money and its bets.

So, here are the five things I learned from this meeting (I probably learned more but I know that people who read blogs have a short attention span…):

1. IBM is focused horizonally and will not get into the packaged software market. The exception will be software packages that focuses on more horizontal requirements.

2. IBM is reinventing Lotus into a collaboration platform. There are many exciting initiatives unfolding in Lotus that focus on a true distributed platform. I expect to see some important Software as a Service initiatives come out of the new Lotus. I would like to see IBM move faster into Software as a Service.

3. Information Management is an increasingly strong part of the IBM platform that transcends the database. IBM is doing a good job at integrating a large number of acquisitions into a substantial SOA based information platform.

4. IBM is doing SOA well. Clearly, the investment in SOA is paying off for IBM. It has more than 5700 SOA engagements under its belt. It is now able to leverage its expertise across key verticals to present a sound strategy to customers.


5. Now, I don’t want you to think that everything is perfect at IBM. There are still areas of concern. For example, the Tivoli organization has plenty of work to do to explain its portfolio to the market and give customers better techniques to get started without getting indigestion . Like other parts of IBM software, it is, in essence a software company in its own right with hundreds of products that don’t always work together as they should. Likewise, IBM Websphere is a huge set of technologies — some better integrated that others. Sometimes customers get overwhelmed with the portfolio.

Trying to reduce IBM software strategy to under 1,000 words is a task few humans should undertake (without a stiff drink of something). I have left out a lot — and there is plenty to say. For example, I haven’t talked at all about the herculean task that Danny Sabbah (I have added a link to Amy Wohl’s blog. She has a good interview with Danny from the same meeting) has taken on to reinvigorate Rational. (Yes, he is making progress. The direction is well conceived — it will just take some time). I also have not talked about the important Express software platforms that are probably IBM’s best kept secret. There are a series of impressive product offerings designed for ease of installation and ease of use required by the mid-market. I always wonder why it is o.k. for big companies to have to do things the hard way (but that’s just me…).

I guess this means that I have to write more about IBM’s software strategy in future entries…

  1. November 14, 2007 at 2:39 pm

    Steve Mills is an amazing man. I worked with him for years and admire his leadership. There are two things that I observed about Steve:
    1. He is second to none in his ability to understand customers’ wants and needs, and how technology can solve them.
    2. His original career was not technical. He has one of the best abilities to discuss very technical aspects. Steve deeply understood many of the initiatves we pursued in SWG, including Web services and platform integration.

    We used to joke that Steve was the Chief Architect of SWG, not me. It was only half a joke.

    I think a blog centric discussion of various SW vendors’ initiatives would be beneficial to many their customers. I think this space will be multi-vendor and multi-platform.

  1. November 9, 2007 at 9:58 pm
  2. November 9, 2007 at 10:02 pm
  3. November 12, 2007 at 1:41 pm

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: