Monthly Archives: May 2012

Rebuttal to Cringely

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Rebuttal to Cringely

By Susan Eustis

Deer in the headlights is the aspect of all US IBM employees as they read the “Not your father’s IBM” blog from Cringely.  http://www.cringely.com/2012/04/not-your-fathers-IBM/.  According to the blog, “The direct impetus for this column is IBM’s internal plan to grow earnings-per-share (EPS) to $20 by 2015. The primary method for accomplishing this feat, according to the plan, will be by reducing US employee head count by 78 percent in that time frame.”  The accuracy of this observation appears to be questionable.

It is possible, I suppose, to move the IBM company to China and developing countries, but the company would surely be a shadow of its former self, much as PAN AM disappeared soon after the executives so arrogantly decided they could run the company from Hawaii.  I met those Pan Am executive men back in the 1960’s, and they had no idea they were running the company into the ground until after it happened.  The problems were clear ahead of time however.

IBM is different.  It has been through a near death experience.  These current set of executives are seasoned.  They work well together as a team.  Team is a significant strength.  In addition, the IBM company has significant hardware and software strength.  It has market entry beyond its core data center business area into the line of business through its services organization.

IBM has the mainframe computer, the best, most powerful, most utilized, most reliable and secure business system around by far.  IBM has the new Pure Systems server initiative that provides a quantum improvement in systems implementation, decreasing what used to take months or weeks of configuration to 4 hours.

Most of all IBM has integration software.  It has SOA, it has a robust WebSphere application server and mission critical messaging systems software platform that dominates the industry because of the quality of the product.  The quality of the middleware is unmatched, it is not even remotely matched by the nearest competitor.  The quality of the IBM middleware is high enough to carry the company for 1,000 years.

That IBM software suite is incomparable with respect to quality.  It is possible to criticize IBM and my fellow senior industry analysts and myself do plenty of criticizing, some of it founded and some of it unfounded, but the reality is that the IBM software is elegant.  It is a five star performance; it is as sweet as the sweetest song.  We should not lose sight of the value that the IBM company brings to every industry worldwide, we should critique the stuff that is bad, but we should always keep our eyes on what is of value.

 

Meg Whitman Announces HP Layoffs of 27,000 Jobs

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by Susan Eustis

Hewlett-Packard (NYSE:HPQ) disclosed that it plans to slash 27,000 jobs, 8 percent of its work force. It will cut 9,000 positions in fiscal 2012 with the balance by fiscal 2014.  HP s restructuring is positioned to save the company $3.0 billion to $3.5 billion by the end of fiscal 2014.

At the end of 2009, HP workforce was 304,000.  At the end of 2010, it was 325,000 employees.  At the end 2011, that number was 350,000.  Over that same period, year-over-year revenue growth was 10 percent in 2010, 1 percent in 2011… and so far in 2012, revenues have been declining.

HP and its partners are being hammered by margin pressure.  HP publicly announced a layoff plan that is a response to the fact that HP is in trouble.  HP performance is challenged.   The company needs to consistently deliver on what they say  they can do.   Whitman confirmed HP’s commitment to infrastructure, PCs and printing, servers, storage and networking.  She seeks to position these divisions with differentiating strength.

HP’s employee count is not sustainable by its low revenue.  The aim is to restore a healthy balance in order to return HP to its position as a growing, innovative enterprise.  Innovation is key.  Workforce reduction is one piece of a comprehensive effor to restore the company to a position of growth.   The aim is to remove complexity, streamline and reduce costs in a number of areas across HP.

HP strategic business pillars are cloud, security and information optimization.  Investments aim to help the company stay ahead of customer expectations and market trends.  The HP consumer-focused PC and Printing Group is focused on design, engineering, quality, and generating demand.

 

Steve Mills at IBM Shifts Company Culture – Improve Time to Value for Customers

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by Susan Eustis
Steven A. Mills, Senior Vice President and Group Executive – Software & Systems looks to achieve better, faster computing.  Steve has spoken eloquently about the importance of transaction processing, explained the economic drivers that led to the development of IBM’s new Pure Systems line of technology.

It is clear that Steve Mills has taken a page from Steve Jobs book and is trying to change the culture of IBM.  He said in a speech recently that Jobs had not new technology, only the ability to deliver what customers really want. While IBM has always had a strong customer focus, this comment takes the company to a new level of customer focus for IBM.  So this is a journey for IBM and the people are capable of making that shift, but do not have any idea of how to do it.  It seems to me that as IBM positions to achieve technology evolutions that are adapted to the market demands of customers.

IBM made the announcement of Pure Systems product line emphasizing the value for customers.  IBM has looked at understanding what is driving customer cost and how to get cost out of server implementations.  Capacity is the issues, the overall cost of compute capacity is the issue.  The cost to run the operations, configuration, loading new software represents manual activity that represents labor intensive tasks, so the IBM technology is being applied to developing less labor for processing.

Set up, operational configuration, reconfiguration are being redone to provide automation at every step of the way.   Labor saving systems are reducing customer spends.

The labor to run and operate systems is implemented with the moniker Pure Systems.  This brings better configuration, true automation of the server, storage, and networking.  It gives the ability to discover systems resources and use them efficiently in an automated manner.  At the server level IBM is providing plug and play, labor savings achieved with pre-configuration.   It literally takes less than 4 hours to get a server into production,   reducing complexity,  masking complexity, providing management of the systems from a single pane of glass.

IBM cannot take complexity out of the systems, but they call it cockpit awareness, reducing complexity to a level, hiding complexity to a level where someone can manage automatically.  The ability of the customer to work with IBM depends on a  tool set used to customize to their configuration.

IBM calls this following patterns.  There is a pattern used to auto provision the units within the data center, server, applications, storage, database, and systems.  IBM has achieved a break through in cost management and systems automation based on customer needs.

Improving the labor side depends on the ability to offer flexibility.  A set of patterns have been developed around configuration.  Simplifying patterns is the aim.  Customers want to be able to take a server out of box and use it without a lot of associated expense.  The aim of IBM has been to adapt servers to deliver lower costs of operations.  Servers are   pre-configured with automated discovery, automated configuration, and patterns of typical use.  The aim is to develop a pattern and repeat it.  IBM has been giving its customers a tool to make mass customization within highly configured system possible.

In this regard, Steve Mills is talking about delivering rapid time to value.  IBM is seeking to deliver a complete system.  It is seeking to deliver hardware and software  together.  It is seeking to deliver more margin for partners and to give customers greater value.   Analytics and big data are a priority, sales force productivity is achieved from realizing greater value from selling process.  IBM offers tools to improve the sales force.  The aim is to effectively manage the sales force.   IBM offers a visualization tool set that lets customers surface patterns within the data.


Academic Competition Develops New Ideas for Watson Technology

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By Jane Clabby

IBM and the University of Rochester’s Simon School of Business announced winners of the first academic competition focused on developing new use cases for Watson. 25 graduate students in a variety of business-related majors formed teams that yielded seven proposals illustrating how Watson’s technology could be applied to solve complex challenges in the transportation, energy, retail and public sector industries. The judges included IBM executives, faculty members and business leaders, and criteria for winning included depth of marketing research, clear articulation of concept, understanding of the technology and Big Data, as well as feasibility.

First, second and third place awards were given, and the winning ideas follow:

1)     First Place “Managing Data in the Eye of a Storm” – Weather data and the latest census numbers could be used to help organizations better prepare for a crisis and allocate resources accordingly in the event of a weather-related disaster. Watson’s ability to look at unstructured and structured information could more accurately identify weather patterns and help improve response times.

2)     Second Place “Mining for Insights, Literally” –Watson could help energy companies improve the understanding of environmental impacts, and regulatory and safety information to reduce accidents while avoiding the over exploration of natural resources by considering profit margin, consumption rates and and opportunities for exploration of oil, gas and mineral reserves.

3)     Third Place ”Unpacking Big Data Improves Travel Experience” – Watson could be used to analyze unstructured historic airport –related information and customer travel data to enhance security and reduce wait times to improve the travel experience.

This competition is an example of the type of work done through IBM’s Academic Initiative,“a global program that facilitates the collaboration between IBM and educators to teach students the information technology skills they need to be competitive and keep pace with changes in the workplace.”  Interest from both IBM and one of the nation’s leading MBA programs illustrates the importance being placed on the knowledge and use of business analytics and evidence-based reasoning for future business leaders. IBM’s press release cites a statistic from the U.S. Bureau of Labor Statistics which states that there will be a 24 percent increase in demand for professionals with management analysis skills over the next 8 years. Joint projects such as this ensure that college and graduate students will have the skills necessary to compete in today’s job market.

 

 

 

 

Colleagues In Care Uses Smart Cloud from IBM

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by Susan Eustis

‘Colleagues In Care’ global health network is using IBM smart cloud to facilitate healthcare delivery in underdeveloped regions of the world.  Smart cloud is positioned to facilitate telemedicine and clinician collaboration.  Many of the world’s leading healthcare organizations and associations are seeking to create centers of excellence that make medical specialists available remotely.

Colleagues In Care is focused on this mission.  The Colleagues In Care CIC best practices technology-leverages a volunteer model can be replicated anywhere.  There is no limitation to the potential reach of the healthcare collaboration model.

The organization is using IBM cloud-based social analytics and collaboration services to provide the global network of healthcare volunteers with immediate access to critical data and information for the current healthcare needs of citizens.  The network consists of 200 doctors, nurses, and business professionals coming together virtually from all around the globe including Canada, China, Haiti, France, Ireland, Italy, the United Kingdom, and the United States.

Colleagues In Care is using the IBM SmartCloud for Social Business to virtually connect medical workers and volunteers from around the globe.  Using the IBM SmartCloud, the volunteers and those on the front lines taking care of patients are armed with an online medical knowledge system that includes treatment options, clinical pathways, and best practices specific to the local situation.

For example, doctors on the ground in Haiti now have immediate access to information. Previously, a healthcare worker typically had no access to a specialist to consult about a specific medical condition. Via the IBM SmartCloud, they can now immediately determine how to best care for a patient directly in front of them, at the same time collaborating with colleagues to determine more population-based strategies of effective care.

Medical workers can develop, post, and share their stories about their experiences, providing this critical background to incoming medical workers.  The system supports 70 online communities on topics including “Mother and Baby,” “Hypertension,” “Heart Failure,” “Stroke,” and “Eye Care” to track initiatives from start to finish.

 

Kristof Kloeckner Talks Smart Cloud in Chicago

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Kristof Kloeckner Talks Smart Cloud in Chicago

Posted on May 17, 2012 by susan

by Susan Eustis

Kristof Kloeckner talks Smart Cloud in Chicago
Smart cloud brings a revolution in collaboration. Smart cloud enables the interconnection of business process in real time with applications – apps. Apps are software that vendors and partners bring to a catalog of social business services. Kristof Kloeckner talked about this most exciting new initiative for IBM, saying that the aim of Smart Cloud is to enlist social business structures for IT. Apps are used to link people and process to each other in real time.

Kristof Kloeckner is General Manager of Rational Software, IBM Software Group . In Chicago this week he described application patterns that can be used in a manner similar to cell phones apps, but are for full blown business applications. IBM has positioned the smart cloud as a black box that has a catalogue of applications that can be downloaded and used within minutes, just like iPhone apps work on a cell phone. IBM has loaded the Smart Cloud with an initial 80 pattern apps that have been complimented by another 3,000 patterns from partners.

The social business structures for IT are implemented as applications with a pattern wrapper. The apps are listed in catalogues. Enterprise social business apps provide a pattern for xyz problem that needs to be solved by business. The apps can get a certification that describes how well the app fits a solution. A pattern for an app means that it can be adapted.

All the IBM customers are now outfitted with a SOA services oriented modular software infrastructure so the smart cloud is designed to provide a context for using SOA modules. Patterns for social business can use the new IBM Pure Systems hardware center as server that implements fully integrated hardware solutions with databases, systems management, and applications configurations all in the server as it is shipped. Then all the social business server needs is an app — an enterprise app called from the social business catalog.

Social business structures are used to build patterns in the cloud. IBM has established a software app trial environment where communications and sharing are enabled. It has established a core governance and processes pure systems center. In this way, the new svelte IBM is seeking to imitate the functionality of the iPOD and iPAD, not yet shaking its stogy underpinnings of transaction management excellence, but adding a new layer of social business systems that provides ease of access and ease of use unimagined as few as five years ago.