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IBM Launches IBM Cloud Business Solutions, Led by GBS

IBM announced today a new portfolio of cloud-based offerings called IBM Cloud Business Solutions. Now the last three words don’t in themselves give away too much as to exactly what is on offer - but IBM is taking assets from across IBM Group, including consulting services from GBS, pre-built assets from IBM Research, IBM software, advanced analytics, and cloud infrastructure delivered via Softlayer, an IBM company, and packaging them up as multiple as-a-service components (Iaas, PaaS, SaaS, BPaaS) into turnkey solutions. After an initial set-up fee, clients pay in a subscription or a usage-based model. 

IBM is launching 12 IBM Cloud Business Solutions now and intends to have 20 in its portfolio by end 2014.

IBM’s Cloud Business Solutions are based on cross-industry patterns, with an industry lens applied to tailor them to specific industry use cases. Many of the initial 12 offerings are in the areas of marketing and operations:

  • The five marketing ones are customer analytics; customer data; digital commerce; mobile industry accelerators; and marketing management
  • The five operations ones are: predictive maintenance (developed for the utilities, auto, manufacturing, consumer products, government and real estate sectors); smarter buildings; smarter asset management; care coordination (in the health sector); and emergency management

The last two cover specific “slivers” in back office functions:

  • Finance: counter fraud
  • HR: digital environment for adaptive learning.

A big selling point in the portfolio is speed to value: in soft launches of five of its Cloud Business Solutions, GBS estimates it achieved a typical 60% reduction in implementation times. This is clearly of interest to companies entering new markets (e.g. one early client is an equipment manufacturer using the predictive maintenance solution to support its entry into a new market), and to companies looking for fast ROI in marketing initiatives. And of course, the IaaS and SaaS components provide more IT agility, a key feature in the attractiveness of cloud to enterprises.

It is significant that IBM Cloud Business Solutions is being led by its Global Business Services unit, who is offering consulting services (and analytics capabilities) on top of the SaaS, PaaS and IaaS stack. An IBM spokesperson describes this as “the next phase in the evolution of how consulting and systems integration services are consumed”. And of course when selling a turnkey “business transformation” offering, it is more likely to be into the business than to the CIO.  But this comment ignores the BPaaS layer, and the next tranche of IBM Cloud Business Solutions will apparently include more BPO in the mix. And this is where BPaaS, which has been hyped for some time by vendors, is likely to take off, for:

  • Specific activities that apply technology and analytics in areas such as digital commerce
  • Specific activities that are at the margin of corporate functions, or that have not historically not been automated

With its IBM Cloud Business Solutions portfolio, IBM is going even further than Accenture’s Business Services initiative because it has IaaS assets such as Softlayer to apply. Take up in the short term is likely to be for discrete activities - and probably by large enterprises who are early adopters (as indeed IBM has found to date). But the outlook must be very positive. Being able to procure a turnkey solution or service through a single contract that has usage-based pricing is likely to be extremely attractive – providing, of course, the pricing is acceptable.

As a footnote, I have wondered for years when IBM would start adding BPO components in earnest to its Smarter Commerce portfolio. The new portfolio could potentially make a big impact in integrating IBM’s cloud solutions, consulting and analytics capabilities with its “traditional” BPO services such as F&A. I for one have never fully understood why BPO sits in IBM’s GTS organization; now more than ever it more logically sits in GBS.

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