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IBM GBS Adds Salesforce Specialization with 7Summits Acquisition

 

We recently talked to IBM GBS regarding its acquisition of 7Summits. After years of limited GBS M&A activity, IBM has been increasing its investment level in this business. With the planned divestment of most of its GTS business, GBS is core to IBM Services. Since October 2020, GBS has made five transactions across cloud, payments, SAP, and Salesforce.

The 7Summits acquisition, which fits into IBM iX, is the first Salesforce services acquisition since its Bluewolf transaction in 2016. With Bluewolf, IBM acquired a tier-one Salesforce partner and gained further scale. Bluewolf had 500 employees and strengthened IBM's Salesforce practice in the U.S. 7Summits also enhances the Salesforce practice’s presence in the U.S.: it is headquartered in Milwaukee, WI, and brings an onshore delivery presence in 30 states, mostly in Chicago, Indianapolis, Atlanta, Austin, NYC, Minneapolis, and San Francisco. We estimate its headcount to be ~240.

7Summits Brings A Specialization in Experience Cloud and Lightning Experience

Unlike Bluewolf, 7Summits is not about acquiring for scale (IBM already has scale, with a NelsonHall estimated 4,000 employees, excluding MuleSoft and Tableau personnel). What 7Summits brings to IBM is a portfolio specialization.

7Summits has a background in Experience Cloud (formerly Community Cloud), Salesforce's portal product. To date, the company remains heavily involved in Experience Cloud and has developed ~70 accelerators, the majority of which are based on Experience Cloud. The company has ~10 Lightning Bolts (i.e., industry templates) on AppExchange, focused on partners, clients, employees, and, in the case of Higher Education, students.

Also, within its IP portfolio, 7Summits has an important IP called Migration Factory, which enables Community Migrations. Community Migration is a set of tools and services for transitioning from SharePoint, Connections, or Jive. With Community Migration, 7Summmits systematically inventories existing content, maps to Salesforce UX constructs, and focuses on contextual data migration.

Its IP also includes around thirteen enterprise applications (point solutions, such as News, Events, and Job Board) and about 30 Salesforce Lightning components (e.g., Image Gallery and Leader Board).

7Summits also created a prototyping IP. The IP relies on Salesforce's Envision for creating UX/UI designs that are compatible with Salesforce's design requirements.  

Five years after its launch in 2015, Lightning Experience continues to drive activity at 7Summmits. 7Summits has developed a Classic-to-Lightning UI migration IP and looks at providing a roadmap for the migration, focusing on the UI and custom code and libraries. 

Beyond Experience Cloud: Integration, Consulting, and UX

Experience-led business solutions require capabilities beyond Experience Cloud. 7Summits uses Experience Cloud to bring together objects from across multiple Salesforce clouds and data and content from other systems to enable digital transformation. 7Summits estimates that each Experience-led implementation requires business consulting (25% of the services provided), UX/UI design services (~10%), technology and implementation services (~50%), with integration as an essential, and project management (~15%). Thus, the company has developed its capabilities around business consulting, experience design, and technology services. Looking ahead, IBM's capabilities in application and data integration, workflows, and the UX capabilities of iX will help scale 7Summits' capabilities.

7Summits recently verticalized its capabilities, starting with the software and high-tech sector, addressing client's needs like iterative product development, customer-led product roadmaps, and field-centric code sharing. 7Summits focuses on activities such as partner onboarding, connecting clients, and maintaining products.

7Summits has found similar partnership management needs in the manufacturing sector. The company also has experience in the higher education sector, with Harvard University, around student onboarding. The company is now expanding to the healthcare payer and provider sector.

The Road Ahead: Multi-Clouds, Agile, and Industry Solutions

7Summits is gradually expanding from its Experience Cloud specialty to become a Service Cloud and helping clients in their multi-cloud journey. Again, the more diverse Salesforce portfolio of IBM will help here. Meanwhile, IBM is expanding its Salesforce portfolio beyond the core Sales and Service Clouds. IBM hints it will conduct additional M&As to strengthen its portfolio. Also, NelsonHall expects a geographical delivery expansion to UKI, the EU, LA, and APAC.

IBM's Salesforce ambitions go beyond multi-cloud and strengthening its capabilities around the different Salesforce products. A priority is accompanying the client across the program lifecycle, from consulting through to application management, through cross-selling GBS' strengths around AI and analytics, automation, DevOps, and application management services. With many enterprise clients selecting Salesforce's products as a front office foundation, IBM highlights its agile development capabilities, using its Garage delivery model and its integration expertise.

Salesforce continues its rapid acquisition strategy, which brings additional products to integration. IBM is accordingly creating templates and reference architectures to pre-integrate different Salesforce products. Salesforce is accelerating its verticalization efforts, identifying white spaces in its vertical solutions, notably through last year's acquisition of major ISV partner Vlocity. Given Salesforce's fast-moving product portfolio, major SI partners such as IBM will be relying on the strength of their partnership with Salesforce to know where to invest next in its industry solutions.

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