Wednesday, April 24, 2024

IBM’s Pivot and Multicloud Focus

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IBM was previously known for being a one-stop shop because of its extreme breadth of products and services. This extreme breadth turned out to have advantages and disadvantages over the years. Eventually, the disadvantages of IBM’s complexity coupled with some executive communication and command and control issues led to challenges for the company. 

The IBM of today is in sharp contrast to the old IBM, which was more insular, proprietary, and less attuned to the changing nature of the market. 

As IBM’s recent financial results show, today’s IBM is more open, believes in the benefits of competition, and leads in efforts to assure the ethical behavior of companies and increasingly intelligent products.

One of the most fascinating areas to emerge at IBM is the IBM Cloud, which is a new take on the mainframe model. And it still plays to IBM’s sustaining strengths.  

Let’s talk about that here:

IBM’s unique cloud focus

IBM recently had an update on its IBM Cloud business hosted by Howard Boville, SVP IBM Cloud. 

I’m fascinated by the differences in cloud approach among Amazon, Microsoft, and Google. For instance, the current IBM cooperates and collaborates with these companies. Instead of an IBM-only strategy, IBM is taking a very different path. It focuses on specific vertical markets, those that are regulated, particularly internationally, by compliance rules and penalties that can vary a great deal from country to country.  

The global regulatory environment is a major challenge for a variety of regulated industries. IBM’s skills, developed over the century-plus the company has been in existence, are arguably unmatched in the younger cloud companies in every country, not just the U.S. 

By using its regulatory experience, IBM has crafted a multicloud solution where customers in these regulated industries can mix and match cloud providers based on their needs for the unregulated parts of their business but use the IBM Cloud to help comply with these regulatory agencies more easily when and wherever needed. And IBM provides oversight and management tools that allow for application movement, management, and global granular access controls that remain constant across both the collection of cloud vendors and the on-premises hardware that remains post-cloud.   

What I also find fascinating is that this focus on verticals is very difficult for the large cloud providers. It was hard for the old IBM, but IBM today is focused on it. The company is demonstrating how to pivot from the way it was to the way it is. It’s a skill that successful companies must develop to survive, but one IBM has used over the decades repeatedly.  

IBM discovered that the better strategy is to understand what your customers want, what they aren’t getting, and focus on helping them make the best choice — even if it isn’t exclusively from you.  

Wrapping up

IBM concluded the briefing with a talk from Shirish Netke, CEO of Amberoon, which specializes in providing IT FinTech solutions for smaller banks. 

Amberoon is what I call a super customer in that it has several banks it is responsible for and can be a great source of information about a segment.

Amberoon is a fan of IBM’s services because it cuts the cost and increases the compliance levels for its customers, allowing those banks to focus more on providing value for their employees and customers because of lowering their compliance overhead significantly. Netke was clearly a fan of the IBM Cloud and once again showcased a sustaining advantage enjoyed by IBM: the ability to get people out of regulatory environments and become advocates for its offerings. 

IBM’s approach not only showcases an advantage in its approach to regulated markets and multicloud in general, but how to compete in a market dominated by larger vendors, by finding ways to leverage them as partners.

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