Archive for the ‘business agility’ Category
Forbes Business Leadership Forum @ Impact 2012: Put The Customer At The Center Of Every Action
Mike Rhodin explains to the IBM Forbes Business Leadership Forum at Impact 2012 Monday morning that the best companies moving forward will put the customer at the center of their every action.
After this morning’s keynote session, I went promptly over to the Forbes Business Leadership Forum to listen for a bit to Mike Perlis, Forbes president and CEO, and Mike Rhodin, IBM’s senior vice president for our Software Solutions group.
In the spirit of full disclosure, I’m a Forbes magazine subscriber — and apparently I’m hardly alone, even in this alleged age of digital media and publishing. In fact, Perlis took great pains to walk the gathered IBM Impact audience through the evolution of Forbes magazine and its transition into the digital era, as a kind of case study into how one unique traditional media publishing property didn’t succumb to the whims of history.
Perlis outlined some key objectives for Forbes, including keeping its print business on track as it built its digital business, and also by developing its brand extensions and becoming a great technology company.
These days, Forbes has some 100 freelancers, 100 staff editors and reporters, and over 300 posts per day on Forbes.com, the centerpiece of Forbes digital strategy.
But Forbes has also embraced the social media in a huge way, with an aggressive presence on all the major social media properties, including Facebook, Twitter, and LinkedIn.
As Perlis summarized, “it’s about the right mix of quality and quantity of information, driven by great technology.”
Perlis then handed the reins over to IBM senior vice president, Mike Rhodin, who leads our Software Solutions business.
Rhodin picked up the ball and reaffirmed that Forbes business journey was an evolution, and that we live in an “information age like none before, where the complexities are forcing us to take a new approach to technology.”
Rhodin noted that companies like Forbes that successfully navigate these uncharted waters must “deploy solutions that are intelligent, integrated by design, and built atop a tech infrastructure that is inherently more cognitive.”
Rhodin went on to cite some examples of the staggering amounts of data that must be dealt with: That there are 340 million Tweets now per day, that 80% of the new data growth are in images, videos and documents, that there are 5 million trading events occurring every second!
Such astronomical figures are creating some tough new challenges, not only for IT but for the mainstream of a business. Forty-five percent of CFOs see a need to improve data integration and risk management, Rhodin explained, and 73 percent of CMOs see a need to invest in technology to manage new big data.
Business leaders aren’t just concerned with what product to buy, Rhodin explained, but are focused on garnering better business outcomes, how to improve the efficiency of their online marketing campaigns, how to improve cash flows…business problems needing business solutions enabled by technology.
Rhodin also explained that business leaders need to learn to think differently (a theme brought up time and again in Walter Isaacson’s keynote this morning) about analytics, explaining that a new pattern of automation is emerging that is being driven by the instrumentation of the world around us.
“We’re infusing intelligence into the fabric of the organization,” Rhodin continued, and that organizational leaders of the future will be distinguished by their “ability to make big and small, strategic and tactical, 360 degree-informed decisions.”
“This has become a 24/7 feedback loop where sellers and marketers constantly change roles,” Rhodin concluded, and those who put the consumer at the center of every action would be the new information age’s ultimate victors.
Simplifying The IT Experience: Introducing IBM PureSystems
I mentioned the coming announcement about our new expert integrated systems in my last post, and lo and behold, the details arrived overnight.
The new family of systems that come with built-in expertise based on IBM’s decades of experience running IT operations from tens of thousands of clients in 170 countries will be called, simply, “PureSystems.”
This effort is the result of $2 billion in research and development, along with acquisitions, over four years, and represents an unprecedented move by IBM to integrate all IT elements, physical and virtual.
This effort is also about a new offering. This new systems family offers IBM customers an alternative to today’s enterprise computing model, where multiple and disparate systems require huge resources in set-up and ongoing maintenance.
The current economics and models have far too many focused too much on the small stuff. Companies worldwide spend an average of 70 percent or more of IT budgets on simple operations and maintenance, which leaves them precious little time to invest in innovation.
Furthermore, two-thirds of corporate IT projects are delivered over budget and behind schedule, according to a recent study by IBM. That same said study also found that only one in five corporate IT departments are able to spend the majority of their IT budget on innovation.
The infographic details many of those IT headaches and challenges facing so many today.
The prime challenge facing companies worldwide is the need to spend 70 percent or more of IT budgets on simple operations and maintenance, leaving little to invest in innovation. Two-thirds of corporate IT projects are delivered over budget and behind schedule, according to a recent study by IBM which also found that only one in five corporate IT departments are able to spend the majority of their IT budget on innovation!
Introducing IBM PureSystems
In today’s unveiling of the new PureSystems family, IBM is revealing three major advances that point to this new era of computing technology designed to allow businesses to lower these costs and headaches:
- “Scale-In” System Design: With PureSystems, IBM is introducing a new concept in system design that integrates the server, storage, and networking into a highly automated, simple-to-manage machine. Scale-in design provides for increased density – PureSystems can handle twice as many applications compared to some IBM systems, doubling the computing power per square foot of data center space.
- Patterns of Expertise: For the first time, IBM is embedding technology and industry expertise through first-of-a-kind software that allows the systems to automatically handle basic, time-consuming tasks such as configuration, upgrades, and application requirements.
- Cloud Ready integration: Out of the box, all PureSystems family members are built for the cloud, enabling corporations to quickly create private, self-service cloud offerings that can scale up and down automatically.
“With its new scale-in design and built-in expertise, PureSystems represents an important advance in the evolution of computing,” said Steve Mills, senior vice president and group executive, software and systems, IBM.
“By tightening the connections between hardware and software, and adding incomparable software know-how, PureSystems is designed to help clients to free up time and money to focus on innovation that many businesses cannot address due to ever rising costs and staffing needs in the traditional data center.”
PureSystems Pricing and Availability
The first two models of the PureSystems family – PureFlex System and PureApplication System — start shipping to customers this quarter. PureSystems support POWER processors and Intel processors.
For more information visit the IBM expert integrated systems blog and be sure to follow the #puresystems Twitter hashtag to follow the emerging conversation around this breakthrough new approach to IT.
IBM Global Chief Marketing Officer Study: From Prime Time To Real Time
As a marketer for IBM who specializes in the digital realm, I was excited to hear about the pending IBM 2011 Global Chief Marketing Officer study, a study of more than 1,700 chief marketing officers from 64 countries and 19 industries, and couldn’t wait to see the results.
The wait is over.
Today, IBM released the results of this important study, one that reveals that the majority of the world’s top marketing executives recognize there’s a critical and permanent shift occurring in the way they engage with their customers, but who also question whether their marketing organizations are prepared to manage the change.
Click to enlarge. The vast majority of CMOs surveyed in the IBM 2011 CMO Study indicated that they are underprepared to manage the impact of key changes in the marketing arena.
Some other initial headlines: The study reveals that the measures used to evaluate marketing are changing. Nearly two-thirds of CMOs think return on marketing investment will be the primary measure of the marketing function’s effectiveness by 2015.
But even among the most successful enterprises, half of all CMOs feel insufficiently prepared to provide hard numbers.
Most of these executives — responsible for the integrated marketing of their organization’s products, services and brand reputations –- say they lack significant influence in key areas such as product development, pricing and selection of sales channels.
The IBM study found that only 26 percent of CMOs are tracking blogs, 42 percent are tracking third party reviews and 48 percent are tracking consumer reviews to help shape their marketing strategies.
“The inflection point created by social media represents a permanent change in the nature of customer relationships,” said Carolyn Heller Baird, CRM research lead for the IBM Institute for Business Value and the global director of the study. “Approximately 90 percent of all the real-time information being created today is unstructured data. CMO’s who successfully harness this new source of insight will be in a strong position to increase revenues, reinvent their customer relationships and build new brand value.”
An Ever-Changing Marketing Landscape, An Empowered Consumer
Customers are sharing their experiences widely online, giving them more control and influence over brands.
This shift in the balance of power from organizations to their customers requires new marketing approaches, tools and skills in order to stay competitive. CMOs are aware of this changing landscape, but are struggling to respond. Four out of five CMOs expect that they will have to make fundamental changes to traditional methods of brand and product marketing.
Baird likened marketers who underestimate the impact of social media to those who were slow to view the Internet as a new and powerful platform for commerce.
Like the rise of e-business more than a decade ago, the radical embrace of social media by all customer demographic categories represents an opportunity for marketers to drive increased revenue, brand value and to reinvent the nature of the relationship between enterprises and the buyers of their offerings. Marketers who establish a culture receptive to deriving insight from social media will be far better prepared to anticipate future shifts in markets and technology.
As someone who has been intimately involved in helping IBM make a successful transition into providing enhanced social intelligence for marketers here inside Big Blue, this is music to my ears.
While CMOs identify customer intimacy as a top priority, and recognize the impact of real-time data supplementing traditional methods of channel marketing and gathering market feedback, most CMOs say they remain mired in 20th century approaches.
Eighty-percent or more of the CMOs surveyed are still focusing primarily on traditional sources of information such as market research and competitive benchmarking, and 68 percent rely on sales campaign analysis to make strategic decisions.
Click to enlarge. CMOs surveyed in the study indicated they are overwhelmingly underprepared for the data explosion and recognize need to invest in and integrate technology and analytics.
Managing the Four Challenges
Collectively, the study findings point to four key challenges that CMOs everywhere are confronting. The explosion of data, social media, channel and device choices and shifting demographics will be pervasive, universal game changers for their marketing organizations over the next three to five years. But a large majority of CMOs feel unprepared to manage their impact.
- Data explosion: Every day we create 2.5 quintillion bytes of data – so much that 90 percent of the world’s data today has been created in the last two years alone. The increasing volume, variety and velocity of data available from new digital sources like social networks, in addition to traditional sources such as sales data and market research, tops the list of CMO challenges. The difficulty is how to analyze these vast quantities of data to extract the meaningful insights, and use them effectively to improve products, services and the customer experience.
- Social platforms: Social media enables anyone to become a publisher, broadcaster and critic. Facebook has more than 750 million active users, with the average user posting 90 pieces of content a month. Twitter users send about 140 million tweets a day. And YouTube’s 490 million users upload more video content in a 60-day period than the three major U.S. television networks created in 60 years. Marketers are using social platforms to communicate – with 56 percent of CMOs viewing social media as a key engagement channel – but they still struggle with capturing valuable customer insight from the unstructured data that customers and potential customers produce.
- Channel and device choices: The growing number of new marketing channels and devices, from smart phones to tablets, is quickly becoming a priority for CMOs. Mobile commerce is expected to reach $31 billion by 2016, representing a compound annual growth rate of 39 percent from 2011 to 2016. Meanwhile, the tablet market is expected to reach nearly 70 million units worldwide by the end of this year, growing to 294 million units by 2015.
- Shifting demographics: New global markets and the influx of younger generations with different patterns of information access and consumption are changing the face of the marketplace. In India, as one example, the middle class is expected to soar from roughly 5 percent of the population to more than 40 percent in the next two decades. Marketers who have historically focused on affluent Indian consumers must adapt their strategies to market to this emerging middle class. In the United States, marketing executives must respond to the aging baby boomer generation and growing Hispanic population.
Lack of Influence
Today’s CMOs have to cover more ground than ever before. They have to manage more data from disparate sources, understand and engage with more empowered customers, adopt and adapt to more sophisticated tools and technologies – while being more financially accountable to their organizations.
Click to enlarge. CMOs surveyed believe that they can expand their personal influence by shifting to new capabilities that focus on technology, social media and ROI.
In fact, 63 percent of CMOs believe return on investment (ROI) on marketing spend will be the most important measure of their success by 2015. However, only 44 percent feel fully prepared to be held accountable for marketing ROI.
Most CMOs have not traditionally been expected to provide hard financial evidence of their ROI.
But given the current economic volatility and pressure to be profitable, organizations can no longer afford to write a blank check for their marketing initiatives. CMOs recognize they now need to quantify the value they bring to the business, be it from investing in advertising, new technologies or any other activity.
This increasing emphasis on ROI also reflects the scrutiny the marketing function is currently attracting, itself a reflection of the function’s growing prominence. Today’s CMOs are in much the same position as chief financial officers (CFOs) were a decade ago, when their role was evolving from guardian of the purse strings to strategic business adviser.
If CMOs are to be held responsible for the marketing returns they deliver, they must also have significant influence over all “Four Ps”: promotion, products, place and price. The study found that this is often not the case.
CMOs say they exert a strong influence over promotional activities such as advertising, external communications and social media initiatives. But, in general, they play a smaller role in shaping the other three Ps. Less than half of the CMOs surveyed have much sway over key parts of the pricing process, and less than half have much impact on new product development or channel selection.
To meet these new challenges, CMOs must boost their own digital, technological and financial proficiency –- but many seem surprisingly reticent in this respect. When asked which attributes they will need to be personally successful over the next three to five years, only 28 percent said technological competence, 25 percent said social media expertise and 16 percent said financial acumen.
About the Global CMO Study
The 2011 IBM Global Chief Marketing Officer Study is IBM’s first study of CMOs — and the fifteenth in the ongoing series of C-suite Studies developed by the IBM Institute for Business Value.
Between February and June 2011, IBM met face to face with 1,734 CMOs in 19 industries and 64 countries to better understand their goals and the challenges they confront. The respondents came from a wide variety of organizations, ranging from 48 of the top 100 brands listed in the 2010 Interbrand rankings to enterprises with a primarily local profile.
Click here to register and receive your copy of the IBM 2011 Global Chief Marketing Officer study.
Live From Impact 2011: IBM Software’s Steve Mills On Business Agility
Katie Linendoll, the “chic geek” technojournalist for both CNN and CBS, spiritedly kicked off today’s Impact 2011 morning keynote.
Scott and I had the pleasure of interviewing Katie yesterday afternoon for Impact TV, whereupon Katie went out of her way to give Scott a hard time about his pad and paper “Think” pad (Us cool kids both had iPads, albeit mine, a 1st generation, Katie’s the iPad 2).
Katie explained that for today’s session, we were going to focus on the how of building towards business agility, and then promptly introduced IBM Senior VP, Software and Systems, Steve Mills.
Steve had also joined us for an Impact TV interview, on Sunday, and continued to relay to the gathered 8,000+ member audience some of the key messages he had communicated during our interview.
In his comments, Steve pointed out for the audience how well received the IBM customer participation in both keynotes and breakouts has been, and he highlighted several in his talk: Caterpillar, NY State Tax Authority, Isbank (in Turkey), all of whom have realized great efficiencies and agility via business process management.
Mills explained that over the past decade, we’ve collectively been on a journey with SOA to build towards business agility, seizing the opportunity to leverage open standards and start to build more horizontal business processes that were no longer isolated to vertical applications.
SOA, Mills explained, has been about trying to unlock those applications and assets which define your business and the particular processes that make your business run, but that you can’t get there without unlocking your own data and assets.
But Mills also pointed out that there’s not a lot of new things in IT. Watson, for example, the computer system that recently took on and beat “Jeopardy!” world champions, is not 4 years old. “There’s over 40 years of IT science behind Watson.”
Applause from the Impact audience. Mills continued: “The last four years were really fun. The past 40 were really hard.”
Business agility requires a robust SOA infrastructure, Mills explained, and we at IBM have worked on helping build a complete infrastructure because we understood our customers wanted to tie a lot of services together and to have flexible, high-performing infrastructures.
This, in turn, could help organizations build less, reuse more, and realize significant economic benefit by bringing down the cost of execution (Most businesses today spend 70-80% of their resources managing the runtime of thousands of programs).
Mills comments about the backstory of SOA served as a perfect segueway to the customer story video Katie introduced about how the City of Madrid built a coordinated emergency management response system after the horrible 2004 bombings there, and is now realizing a 25% faster response time for emergencies (and improving all the time).
And, to Phil Gilbert, IBM VP BPM, and his demo of the new IBM Business Process Manager. Gilbert observed that there are $1T in losses in process inefficiencies every year, and yet both good and bad events have increased in both severity and frequency.
Citing Alfred Sloan, former CEO of General Motors and process improvement guru, he explained that “good management rests on decentralization with coordinated control.”
IBM’s approach to BPM can deliver such coordination.
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