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Interview: How do you define IBM?

It is the world’s oldest computer company, and it was once said you didn’t get fired for buying from Big Blue. But a lot has changed. Sreeram Visvanathan, CEO for UK&I, explains how IBM is reinventing itself

The face of computing is constantly changing. It was once associated with “big iron” and IBM, then there was the software stack, most notably with Microsoft and its Windows ecosystem. Today, it is the realm of the web giants, the likes of Facebook and Google, and Apple, which has mastered the knack of selling things people think they really must have.

But these giants are outside the remit of enterprise IT, which is what IBM has always seen as its domain, and where it has focused its research and development efforts.

Sreeram Visvanathan, CEO for the UK and Ireland at IBM, says: “We have always been the same. We shape the technology industry way ahead of others.”

He says the company “made big bets” on the mainframes, pointing to what it did with System/36 and System/38, WebSphere in the services-oriented architecture (SOA) era and its services play. He describes them as “industry shaping”.

Smarter planet

One of these industry-shaping things, according to Visvanathan, is the IBM campaign in the early 2000s around the concept of a smarter planet.

“What is a smarter planet? It is data, insight, intelligent workflow and an agile architecture that makes you nimble and faster. We’ve stopped talking about it because that is what the planet is becoming,” he says.

Despite this, many organisations are still struggling. “There is organisational inertia,” adds Visvanathan. “The technology exists, but people are holding onto power and unwilling to change and ask fundamental questions about why they do things the way they do.”

IBM has been working on repositioning and refocusing itself following its $34bn acquisition of Red Hat. The company completed the separation of its Global Technology Services (GTS) into Kyndryl, which has been operating as a separate, publicly traded company since November 2021.

This frees IBM to concentrate on delivering a strategy based on providing clients with the ability to deploy hybrid IT, where workloads can exist on-premise, in a private cloud or in a public cloud. In its filing for the fourth quarter of 2021, IBM posted revenue of $6.2bn from hybrid cloud, an increase of 16% on the previous year, while software revenue was up by 8% compared with the same quarter the previous year.

Not every organisation has the same appetite to adopt new technologies, which may hold them back, according to Visvanathan. “IBM recognises that people have legacy. The answer is not about pushing new technology down their throat,” he says.

“The reason we bought Red Hat is to give customers choice, to wrap an architecture around legacy IT,” he adds. In IBM’s vision of this architecture, “it only needs to be built once and can be deployed anywhere, across multiple cloud environments”.

It used to be the case that people could be sure they would not get fired for buying from IBM – but IBM is no longer the only option for IT leaders looking to build a secure and resilient IT architecture. There are a number of IT suppliers associated with a culture of innovation, and these are often used to stimulate innovation in IT departments.

But, asks Visvanathan, how much can an organisation change? “There is a risk in reframing the target of digital transformation. People buy from people,” he says.

Managing complexity

Visvanathan says IBM’s focus is on simplification of the supplier relationship, where IBM brings to the table its willingness to work with multiple partners such as SAP, Adobe and Salesforce. “I say to clients, ‘When you give us an opportunity, we earn your trust’,” he says.

This begs the question of why IBM belongs on an IT decision-maker’s shortlist. “We have great engineering skills,” he adds. “We lead in the patent space. It’s a culture you build. It is about putting the client first and working in tandem with them. We help to show what the technology can do, such as the power of AIops [artificial intelligence for IT operations], and offer the flexibility to work with multiple ecosystem partners.”

“We have great engineering skills. We lead in the patent space. It’s a culture you build. It is about putting the client first and working in tandem with them. We help to show what the technology can do and offer the flexibility to work with multiple ecosystem partners”

Sreeram Visvanathan, IBM

Tech research and advisory firm ISG forecasts that the global market for infrastructure as a service (IaaS) and software as a service (SaaS) will grow by 20% and the global market for managed services will advance by 5.1% in 2022. The analyst is seeing a pipeline of new contracts, which should be good news for IBM as it reinvents itself.

IBM has traditionally been seen as taking the lead in large and complex IT contracts involving multiple IT providers. But while such contracts are less fashionable these days, Visvanathan sees IBM’s role as the 110-year-old company that is the responsible steward of computing.

He says: “Clients used to feel, ‘We want to deal with one key organisation, but what happens when no one is watching? When things go wrong, who do I count on?’.”

It remains to be seen whether people will ever get fired for buying from IBM. What is clear is that, today, IT decision-makers have plenty of choice. But IBM remains a stalwart of enterprise IT. While its technology may not always grab the headlines, Visvanathan says IBM technology is behind many of the essential services that form the backbone of modern society.

Read more about Big Blue

  • Responding to users’ demands for dependable access to banking services, Nationwide Building Society continued its commitment to IBM’s Z series of mainframes, upgrading to the z15.
  • Allied Irish Banks has continued its investment in IBM Z series hardware and the Red Hat software portfolio to help it achieve its digital transformation goals.

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