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Good Things Come in Threes

Analysis of News Events
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One Mo' Time

For over 20 years, IBM has relentlessly and painstakingly worked to define and refine how to make it easier for Business Partners and, hence, the SMB whom they serve, to do business with IBM. While monikers for programs, offerings, and logos have changed (and multiplied) with sometimes dizzying velocity over the years, it has become apparent that IBM does understand that Business Partners contribute significantly to its bottom line and that the SMB is a lucrative revenue source.

Last month, Terri Pensock, Director of Worldwide Small and Medium Business (SMB) Marketing and Partner Ecosystem for IBM Systems and Technology Group (STG), provided a mid-year update for IT industry analysts on IBM's four-pronged SMB Business Partner strategy and IBM Express Advantage, which was launched during PartnerWorld 2006. At that time, Pensock indicated that for 2006, IBM STG SMB had attained 75% of its revenue goals by the end of April, causing the group to reset its target for the year. Moreover, Pensock reported that at the end of May, IBM was already at 60% complete against its goal of recruiting 25% new partners on each of the server platforms and storage.

Pensock discussed IBM Express Advantage, which is designed to enable SMB customers to accomplish their business goals, and outlined three design elements:

  1. The Express Offerings Portfolio of products, which must meet specific criteria to qualify as Express
  2. PartnerWorld Express Advantage for the Business Partner ecosystem, which spans the continuum of support from identification and recruitment through enablement, marketing, and support
  3. The client experience, which features an interactive Web portal and advertising outreach

During the briefing, analysts were also updated on IBM STG's SMB priorities and highlights for 2H06, which include the following four-pronged strategy:

  • IBM Express Seller, which guarantees participating high-volume Business Partners low prices and continuity of supplies so that they can offer their SMB customers competitive products and on-time delivery
  • IBM investment in infrastructure solutions, which includes IBM Built on Express in which partners build solutions and services on top of one or more IBM Express products. Partners who have successfully submitted a vetted customer experience can use the Express Advantage Built on Express emblem. Since its launch in 2005, IBM also announced that it has just approved its 500th Built on Express solution.
  • IBM's ongoing endeavor to improve the customer experience through the provisioning of the System Advisor Tool, which is an interactive Web portal that provides recommendations to SMBs about server and storage offerings
  • IBM's investment in growing and emerging markets, which include Brazil, Russia, India, China, Poland, and Turkey


IBM has informally dubbed its 2006 SMB strategy as "simple." There is no doubt in this analyst's mind that IBM has significantly—year after year—improved its SMB and Business Partner strategies. IBM's intentions in providing a wealth of programs are positive, but the programs appear too copious and also tend to bleed into one another. This analyst often ponders whether the IBM SMB program/offering landscape is still somewhat cumbersome to navigate, especially for SMB customers and Business Partners who run lean and mean and for whom time is of the essence and revenue is at stake. It would seem that consolidation of programs and straightforward roadmaps are needed.

This analyst would be interested in hearing from both customers and Business Partners regarding IBM's 2006 strategy. It is of great interest to learn if customers and Business Partners have found the programs, offerings, and emblems to have a positive impact on revenue, time to market, ease of acquisition, implementation, deployment, and use. Please submit your thoughts in the associated forum at the end of the article.

"i" for All and "All-in-One" JDE Applications for "i"

In a press release last week, IBM announced that it would deliver to SMB customers a complete Oracle ERP Solution based on System i. The solution is designed for SMB customers with 100 or fewer users that are implementing Oracle's JD Edwards EnterpriseOne applications. This "all-in-one" System i offering is deemed to have a comparable acquisition cost analogous to Windows-based solutions. The IBM System i 520 Solution Edition for Oracle's JD Edwards EnterpriseOne applications is slated "to be available from IBM and IBM Business Partners on August 11, 2006 with hardware configurations beginning at $21,921." According to IBM, this offering targets not only new customers, but the JDE install base as well.

IBM purports that the System i 520 Solution Edition is optimized for Oracle's JD Edwards EnterpriseOne. System i developers in conjunction with the IBM/Oracle International Competency Center "tested and sized the solution specifically for SMBs." The benefit of the System i platform is that it integrates open standards, security, virus resistance, database, storage, and systems management. SMBs can run both front- and back-office applications on a single system. IT decision-makers should be cautioned that this System i offering does not have the interactive feature.

This announcement "builds on Oracle's announcement in April of its plans to provide continued enhancements to Oracle's JD Edwards World and JD Edwards EnterpriseOne applications running on System i." Readers should note that there is a System i 520 Edition for World.

The advent of the System i 520 Solution Edition is good news for those SMBs that are already running EnterpriseOne applications, plan to migrate from the World products, or are new customers, because the purchase price is competitive with Windows-based solutions. Existing System i customers are already aware that the advantages of running applications on i translate into the need for less staff and the promise of less downtime, which is critical for SMBs competing with larger enterprises.

However, while this new offering is extremely attractive, one can't help but ask the question: Will this encourage the thousands of customers who are still running World to convert to EnterpriseOne? And is this offering designed for that purpose? The System i 520 EnterpriseOne offering may alleviate some of the pain of conversion—at least from the operations and systems programming perspective—but that is merely a fraction of what is involved in converting from World to EnterpriseOne. Readers are invited to comment.

New and Improved System i Capacity BackUp Edition

While a press release for this announcement has not been issued, MC Press has learned that IBM is changing the Ts & Cs for System i Capacity BackUp. The new IBM System i Capacity BackUp Edition is the culmination of IBM having listened to its customers and understanding that many customers, especially those in the SMB arena, wish to start small when it comes to purchasing a backup server and have the option of adding more capacity over time. This announcement is also in response to the growing customer demand for high availability.

The new IBM System i Capacity BackUp Edition enables customers to start with a disaster recovery server and grow into a high availability server. While customers will pay the same price for i5 O/S and the processors, IBM is removing the O/S license restriction for customers that wish to role swap their backup and primary servers.

This announcement applies to both Enterprise and Standard Editions for disaster recovery and high availability and supports ISV solutions, Independent Auxiliary Storage Pools, and Cross Site Mirroring. Our understanding is that at this time this offering applies only to the System i 550, 570, and 595. Customers wanting more information should contact their IBM account teams or their resellers.

Good Things Come in Threes

While not earth shattering, the above SMB update and System i announcements demonstrate the following:

  • The ongoing commitment, albeit sometimes confusing and complicated, by IBM to better equip and enable Business Partners that serve SMB customers
  • Collaboration between IBM and Oracle as both vendors not only seek peaceful coopetition, but strive to improve, and not disrupt, the customer experience
  • Efforts by IBM to remove the barriers to, and simplify, entry for customers seeking business resiliency in a competitive marketplace

Maria A. DeGiglio is President of, and Principal Analyst for, Maria A. DeGiglio & Associates, an advisory firm that provides clients with accurate and actionable information on business and technology initiatives. You can reach Ms. DeGiglio at This email address is being protected from spambots. You need JavaScript enabled to view it..

MARIA DEGIGLIO

Maria DeGiglio is president and principal analyst of Maria A. DeGiglio & Associates. Current clients of Maria A. DeGiglio & Associates include the Visiting Nurse Service of New York ; Experture, LLC; and MC Press. Ms. DeGiglio has more than 20 years of experience as an IT consultant, industry analyst, and executive. From 1997 to 2005, she worked for Andrews Consulting Group and the Robert Frances Group.

 

Ms. DeGiglio received her Masters Degree in Health Advocacy from Sarah Lawrence College and graduated Cum Laude from Cornell University with a Bachelor of Arts Degree.

 

 

Ms. DeGiglio has worked with IT and C-level executives to enable IT alignment with business goals and to implement best practices. She has experience and expertise in both large enterprises and in small- and medium-sized business. Ms. DeGiglio has authored over one hundred articles, reports, and white papers.

 

 

Since 2004, she has worked in the healthcare industry and in health IT investigating the legal, ethical, and regulatory aspects of creating, implementing, and exchanging electronic health records (EHRs). Ms. DeGiglio is an expert in security, privacy, and HIPAA regulatory compliance.

 

 

Ms. DeGiglio may be contacted at This email address is being protected from spambots. You need JavaScript enabled to view it..

 

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