IBM Connect Trip Report: Moving Up the Organization, Uneasily

IBM has celebrated its 20th anniversary of Lotusphere…by renaming it. Nearly 10,000 people are in Orlando this week at the newly-renamed IBM Connect to hear IBM’s social story.   It’s a fascinating story and Lotusphere…er, Connect…demonstrates that opportunity and tension beautifully.

I find the agenda this year to actually be fascinating.  Loutsphere used to really be a geek-fest.  All of the sessions were deeply technical and dressed up attendees wore t-shirts without holes in them.  Now, those people are still here but there’s a significant presence of people in business functions, often wearing blazers and even ties.  This clearly reflects the evolution of technology from something for geeks to something that solves business problems.  IBM has obviously embraced this with their Smarter Everything mantra.  This speaks directly to the CxO level and very little if at all to the deep technology person.

So, have they been able to pull this “social biz” thing off?  Well, first, let’s just say they’re no Salesforce.  Dreamforce was part technology conference, part evangelical fervor (http://www.hfsresearch.com/Social-Business-Goes-Mainstream).  IBM Connect is, well, IBM.   IBM’s actually in a fascinating position.  On the one hand, I love the vision.  IBM is promising and, to a large extent, delivering a solution that only IBM could deliver.  Their product portfolio is comprehensive, second to none, and surrounded by a complete set of services.  On the other hand, this is a market that’s still building bottoms up, where IBM is very, very weak.  They talk about how they have no problems getting into to talk to the C-suite but I’m not sure that that’s delivering commensurate business results.  This Smarter Everything approach requires buy-in at very high levels and that surely lengthens their deal time.  There are others who raise legitimate questions about whether IBM’s getting the return on its software investments so far. http://www.businessweek.com/articles/2013-01-22/ibm-makes-more-money-selling-less-of-what-people-want  Basically, IBM is making a big bet that the future of technology is a huge, high level business solution, which clearly moves it far afield from its traditional Lotus customer, and brand.

It has been interesting to note this week that IBM is making a big play with its Kenexa acquisition.  Kenexa and Smarter Workforce mentions have been ubiquitous.  It was so over the top that I asked a senior IBM person if this was part of the corporate-mandated talking points for everyone.  He actually found it an interesting observation, noting that while it was not a corporate mandate, Kenexa was the “new shiny thing” and that therefore, it naturally got a lot of attention, especially at that billion dollar price point.  Kenexa is certainly a noteworthy acquisition for IBM but the attention it got this week was overstated.  We can expect to find more normal positioning for Kenexa as the bloom comes off the flower…or when IBM makes its next big acquisition.

We analysts love situations where what vendors are saying drifts very far from what they’re really selling, and what the customer is buying.  IBM is dangerously close to that situation.  But I understand, and support, what they’re trying to do.  This market is undergoing a long-term evolution and it’s hard to turn battleships, both IBM’s and its customers’.  IBM is going to have to keep telling this story over and over until it sticks.  It will lead in the short term to situations like this conference, where there’s an uneasy connection between the past and the future, between the legacy technologists and the new business approach.  Each year, though, it will get a little easier and a little more cohesive.

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