Smarter software acquisitions

A lot goes into building smarter software for a smarter planet. Thirty-three thousand developers; 100,000 business experts backed by a network of more than 30,000 IBM Business Partners; and over 50 years of industry, business and technology experience mean that IBM Software is infused with deep expertise of how both technology and businesses work -- and how technology can make businesses work better. It also means that IBM Software is built for change – designed on open standards and easy to integrate with a range of platforms to adapt to a rapidly shifting and complex business environment. And it means software that is industrial strength and proven ready to work. It’s robust, scalable and backed by world class support.

Another critical component to building smarter software is strategic investment. Over the past nine years IBM investment has shifted the company toward a focus on software. IBM Software profit has tripled since 2000, and in 2010 contributed 44 percent of IBM’s segment profit. Since 2001, IBM has completed more than 70 acquisitions of software companies.

Every software acquisition IBM makes supports the characteristics of being expert, open and ready to work. These strategic characteristics enable practical capabilities and solutions aimed at specific client needs. By helping meet those needs, IBM Software can fuel innovations and drive better business outcomes that help clients build smarter businesses and a smarter planet.

How do businesses understand the almost immeasurable flow of data and information that courses through their operations and the world and use it to gain insights to make better decisions and achieve better results? The IBM 2010 CFO Study discovered that organizations that invest in insights gained through business analytics are outperforming their peers in terms of revenue growth, profit growth and return on investment capital.¹

IBM is investing there, too. In 2008, IBM acquired Cognos to become a leading provider of technology and services for business intelligence and performance management. The more recent additions of companies such as SPSS and Clarity (link resides outside of ibm.com) complemented and broadened those capabilities with advanced predictive analytics and data integrity and automated external reporting technologies. The addition of OpenPages brings insight into risk management to provide a comprehensive set of solutions for clients’ business intelligence and analytics needs.

For example, the Belgian Red Cross of Flanders is using IBM Cognos software to improve the quality and supply of donated blood by managing it in smarter ways. The software provides enhanced inventory management and establishes when and where donations are needed, and identifies required blood types. Reports can be made visible to hospitals and other clients, enabling more efficient stock management, and data mining allows donor profiling to increase the chance of attracting new, healthy donors and significantly reduce waste and costs.

Few areas impacting business today are experiencing innovation at the pace of collaboration and social media. IBM is looking beyond simply leveraging social media technologies to discover expertise and speed decisions. The opportunity exists for companies to transform into social businesses – organizations that use social media in smarter ways to strengthen how they market and sell, develop new products and manage their workforce.

Several IBM Software acquisitions are helping businesses make this transformation:

The purchase of Outblaze Ltd. provided a global hub with a secure, online e-mail provisioning capability that supports cloud-based collaboration.

The acquisition of WebDialogs (now LotusLive™) expanded the web conferencing capabilities of the already powerful IBM Lotus® Sametime® by adding a software-as-a-service delivery model.

A server and software combination acquired with Net Integration Technologies helps businesses with limited technical resources focus on their business with an easy-to-maintain technology foundation that can support a full range of social media functionality.

These capabilities can help drive innovation through social media and collaboration as they did for CEMEX, one of the world’s top building materials companies. ”What started with a few hundred users in April of this year grew to 17,500 today. But it's not the numbers that define this success,” said Sergio J. Escobedo, Innovation Director, about a social media solution to boost teamwork and productivity at CEMEX. “We see a marked increase in blogs, and blog comments, as well as in the creation of more than 350 communities to bring people with common interests and goals together. Now that's the power of social networking."

IBM acquisitions are also helping clients react faster to changes in the marketplace, enable a flexible and responsive IT infrastructure and create and support more efficient and adaptive business processes. In short -- become more agile.

Software acquired with the purchase of Sterling Commerce enables clients to build integrated partner-supplier networks with the flexibility to react to changing business conditions and customer needs.

Dynamic infrastructures are aided by the addition of Cast Iron Systems (link resides outside of ibm.com) whose cloud integration software, appliances and services help clients take advantage of the flexibility and cost control of cloud computing.

The ILOG portfolio addresses process innovation with business rules solutions that empower business decision makers -- and offers optimization and visualization capabilities that can enhance software across the IBM portfolio with greater usability and scheduling and logistics power.

Acquiring Business Process Management (BPM) software innovator Lombardi gave IBM clients access to integrated BPM solutions that could respond much faster to shifting business demands. By automating business processes using software from Lombardi, financial services provider Lincoln Trust Company was able to reduce customer complaints by 90 percent and achieved expected ROI of 120 percent in less than one year and an overall cost savings to date of US$2.2 million.

When it comes to operating more effectively and efficiently, being able to automate, visualize and control assets and processes is the key. IBM has completed several acquisitions that speak to these critical needs.

With the purchase of MRO, IBM added the capability to better manage enterprise assets – from trucking fleets to production facilities to IT hardware and software. The IBM Maximo® software from MRO helps clients monitor and manage all of these assets and more from a single platform and provides comprehensive visibility to all asset types. Vallent plays a similar role for telecommunications networks with software that monitors network performance and identifies problems before they impact the customer.

Intelliden provides software that enables organizations to automate the configuration of thousands of manually managed network devices like hubs, routers and switches from dozens of vendors.

FilesX offers storage software that provides continuous data protection and nearly instant data and application recovery for enterprises and remote/branch offices.

Put it all together and these acquisitions further enable IBM to deliver service management solutions to help clients improve efficiency by operating smarter. Take the City of Cambridge in Canada. It uses IBM Maximo asset management software to proactively manage its infrastructure. This approach is expected to eliminate over CAN$71 million in repair backlog and deliver a potential savings of over CAN$6 million in annual costs.

Innovation is the key to competitiveness today. The innovators change the game and gain share. IBM is investing in helping clients drive greater product and service innovation. Two excellent examples come from the application development and software delivery area.

BuildForge helps clients automate their software development processes, as well as meet audit and compliance mandates. Software development teams can better document what was created, how it was developed and where the application was deployed – and as a result – minimize auditing and tacking tasks and maximize the focus on software innovation and speed the delivery of new software.

Telelogic solutions automate and support best practices across the enterprise. They enable organizations to align product, systems and software development lifecycles with business objectives and customer needs to improve quality and predictability, while reducing time-to-market and overall costs.

Valltech, an Indian computer services provider, used IBM Rational® Rhapsody® software based on technology acquired through Telelogic to create a new object-oriented process for global development. The solution achieved a 40 percent increase in productivity and reduced defects by 75 percent while lowering development costs.

With all that IBM Software can help clients achieve, perhaps the most important is protecting their businesses by managing security and compliance. IBM has made a number of software acquisitions to help in this area.

OpenPages, for example, not only supports analytics needs as you’ve seen above, it is does so in a way focused on risk management and regulatory compliance. Combined with IBM services capabilities, systems management, security, information governance and other IT governance capabilities, clients have an accurate and actionable view of the risks that can undermine enterprise performance.

Another example is from the acquisition of BigFix in July of 2010. The Software provides built-in intelligence that identifies all of a company's PCs, laptops, servers, point-of-sale and virtualized devices -- wherever they are -- then flags when devices are not in compliance with corporate IT standards.

Capital Region Health Care, a charitable health delivery system for community-based healthcare in New Hampshire, has been a Big Fix customer for years and is an early adopter of BigFix software. "With these new user interface changes -- particularly the ability to see all virtual and physical assets in a single place -- our IT staff will continue to be able to deliver reliable, rapid, and superior quality of service to our organization," said Mark Starry, Director of IT Infrastructure and Security.  

Ask any marketer if they could move from a slow, impersonal, single channel, scatter-shot approach to marketing to a quick, agile, personalized, multi-channel, focused – smarter -- approach, and they would simply ask: How?

That’s what is happening in marketing today. Leading Chief Marketing Officers understand that the web has changed from a network of content to a high-speed, highly interconnected network of people and interactions that can make or break their brands. The key to succes is scientifically analyzing and understanding buyer behavior and having the tools to respond. IBM has invested US$2.5 billion in technology and expertise to help them.

Acquired in August 2010, Coremetrics software provides real-time intelligence on what customers are saying about products, content and services, and enables organizations to make fact-based, accurate decisions about marketing expenditures.

Technology from Unica helps clients analyze customer preferences and trends, predict customer buying needs and execute and measure relevant cross-channel marketing campaigns. 

SPSS, helps clients apply predictive analytics to data to uncover unexpected patterns and associations and develop models to guide front-line interactions.

Sterling Commerce delivers leading e-commerce, fulfillment and business-to-business integration capabilities across a wide range of industries.

Add capabilities from IBM technologies focused on collaboration, process management, software delivery, service management and more, and clients can clearly turn to IBM to transform their marketing efforts, Swedish insurer, Länsförsäkringar, went from two nationwide direct marketing campaigns a year to 13 unique, customer-specific campaigns a day.

Whether it’s gaining insight into your information, improving agility, enabling product and service innovation or any of the other needs you may have, smarter software is positioned to craft a solution that’s always expert, open and ready. As you look at solutions from IBM, be sure to ask about new capabilities IBM Software acquisitions have brought to the portfolio and how they can fuel innovation at your organization, shape better business outcomes – and ultimately – help build a smarter planet.

¹The New Value Integrator, Insights from the Global Chief Financial Officer Study