Winning In Europe And Oklahoma

IBM announced a couple of nice wins these past few days.

One, a partnership agreement between IBM and Itella, a leading provider of business services in Europe and Russia.

It’s a seven-year cloud computing agreement to help Itella streamline its business operations and improve its flexibility and time-to-market, and allowing them to focus on their core business and develop new services for their clients.

Itella provides postal, logistics and financial transaction process services in Northern and Central Europe, as well as Russia.

Specifically, IBM will build a private cloud to provide hosting as well as application management and development services to Itella. With the cloud, IBM will automate basic production of technology services as well as improve the quality and management of those services.

“Through this operating model renewal, we can adopt a flexible service delivery to increase automation and introduce best practices, utilizing IBM’s world-class competence,” said Jukka Rosenberg, Senior Vice President, Itella Mail Communications. “Through the partnership, we can make our operations more efficient and cut costs, without compromising our high-quality service.”

And nearly halfway around the globe and just north of here, the great state of Oklahoma is partnering with IBM to save $15 million over the next five years and to help improve services to state residents there.

As governments institute structural changes in the way agencies measure performance and deliver services, data analytics and new delivery models can help lead the way for transformations that realize a measurable return on investment and improved quality of life.

By analyzing business processes and consolidating IT projects, IBM will help the state gain significant savings in software licensing and technology maintenance costs— resulting in an expected IT budget recovery of 30 percent.

“At a time when we all have to learn to do more with less money, IBM has been instrumental in identifying and prioritizing IT consolidation projects for the state of Oklahoma, at the same time allowing us to invest in new services for our residents,” said Alex Pettit, chief information officer, state of Oklahoma.

“IBM brought not only its extensive public sector services experience to help create the initial business case for this project, but also worked with participating agencies to verify that the new technology environment would improve mainframe service and reduce costs.”

IBM helped the state to understand the challenges of providing IT services to various agencies with diverse requirements for data management and federal reporting.

The new IT infrastructure established a model for IT compliance with federal guidelines on program data and processes, using an IBM System z mainframe. IBM also helped the state meet project funding requirements—bridging the financial gap between the initiation of the project and the cost savings.

The agreement helps ensure that the delivery of technology services is more effective and more consistent. In addition, the new infrastructure gives each agency more control over the quality, performance, and support of their technology environment.

Ultimately, the consolidation of five mainframe platforms also yielded significant savings in costs and lower lease costs. The recommended options projected an 18-30 month payback period that would save 25–30 percent of the state’s combined annual IT budget.

IBM worked with the state on a detailed analysis of the IT infrastructure and opportunities to consolidate computing capacity, storage, network, backup and disaster recovery capabilities.

The plan included development of a target architecture, establishment of a high-level roadmap, and development of a services delivery schedule between the Office of Management and Enterprise Services (OMES), responsible for operating the consolidated environments, and each state agency.  

You can learn more about other of IBM’s smarter government initiatives here, and about IBM’s cloud computing offerings the likes of which it’s building for Itella here.

Gladly Pay You Tuesday…

We’re finally getting some rain in central Texas.  We’ll see how long it lasts!

And on the topic of rainmaking, this just in from our friends at Nucleus Research.

Nucleus conducted an analysis of 21 of IBM Smarter Commerce case studies and their ROI, and discovered that for every dollar spent, companies realized an average of U.S. $12.05 in returns.

According to the research, this payback occurred in an average of 9 months (with a high of 23 months, and a low of two).

The cases Nucleus analyzed included U.S. and European companies and government agencies which had deployed IBM Smarter Commerce technologies.

All the case studies were developed independently by Nucleus, following their standard ROI methodology, and IBM was privy to the results only after the research was completed.

In their analysis, Nucleus also observed some summary conclusions, finding that Smarter Commerce projects delivered both top-line and bottom-line benefits, with roughly 60 percent of returns coming from indirect benefits such as productivity, and the rest from direct savings such as reduced operational costs or hires avoided.

Specific key benefits included the following:

• Increased productivity. In many cases companies were able to accomplish more work with fewer staff or avoid additional hires as they grew by automating previously manual processes and increasing employee productivity.
• Reduced costs. Smarter Commerce customers experienced cost reductions in areas such as customer call handling costs, technology costs, and other costs associated with supply chain transactions.
• Improved inventory management. Greater visibility into customer demand and inventory levels enabled Smarter Commerce customers to gain better control over their inventory, reducing inventory carrying costs and increasing inventory turns.
• Improved decision making. Greater agility and rapid insight into data for decision making enabled companies using Smarter Commerce to more quickly make decisions and act on them with confidence.
• Reduced customer churn and increased customer satisfaction. Companies using IBM Business Analytics were able to more rapidly understand customer satisfaction and retain more profitable customers by proactively addressing customers’ propensity to churn. For example, one telecommunications customer was able to reduce customer churn by 8 percent in the first year and 18 percent in the second year by further refining its churn analysis.

Customers Leverage Prepackaged Functionality

Nucleus indicated that the $12.05 average return from Smarter Commerce was at the high end of the range of returns Nucleus had seen from other assessments of deployments such as analytics and CRM, and many IBM Smarter Commerce clients indicated they had achieved high returns by taking advantage of the investments IBM has made in providing integrated solutions, more intuitive user interfaces, and prepackaged industry functionality.

By way of example:

• Integrated solutions and prepackaged industry functionality accelerate time to deployment and time to value while reducing overall project risk.
• Usability improvements drive more rapid adoption and make it easier for companies to drive adoption of technologies such as business analytics to casual and business users beyond the data expert specialists that have historically been the primary users of analytics.

Industry-specific functionality and expertise were particularly important in the success of customers adopting Smarter Commerce technologies in the government sector, such as social services agencies and police departments, where IT often has limited resources.

You can go here to download the full report.

Blue Water

Population growth, massive urbanization and climate change are placing increasing demands on our limited water supply. Forty one percent of the world’s population – that’s 2.3 billion people – live in water-stressed areas; this number is expected to grow to 3.5 billion by 2025.

And according to the United Nations, water use has been growing at more than twice the rate of population increase over the last century.

With advances in technology — deep computing and Big Data analytics linked to sophisticated sensor networks and smart meters — IBM is helping clients and partners make smarter decisions about water management.

By monitoring, measuring and analyzing water systems, from rivers and reservoirs to pumps and pipes, we can better understand the issues around water.  IBM is applying its expertise in smart systems and Big Data to help companies, governments and citizens understand and more effectively deal with these issues.

Waterfund LLC announced today that it has signed an agreement with IBM to develop a Water Cost Index (WCI).

Scientists from IBM Research will apply Big Data expertise, acting as a calculation agent, to analyze large and diverse unstructured data sets. This will be used to develop of a WCI framework that would estimate the cost of water in different regions around the world. With its market and financial product expertise, Waterfund will work to structure and commercialize the WCI.

Discerning The Real Cost Of Water

As governments are increasingly forced to turn to the private sector to fund the construction and maintenance of complex water networks, the Rickards Real Cost Water Index™ will serve as a benchmark for helping measure hundreds of critical projects on a like-for-like basis.

Index values will reflect estimated water production costs measured in US dollars per cubic metre for a variety of major global water infrastructure projects ranging from retail water utilities and wholesale water utilities to major transmission projects.

“The backlog of investment in water systems around the world by some estimates approaches $1 trillion – quite apart from the hundreds of millions of people who have never had access to a water or sanitation system at all,” said IBM Distinguished Engineer and Big Green Innovations CTO Peter Williams.

“By creating a benchmark cost for water we intend to harness the capital market to this supremely important cause. If we can make it easier to price investments in the water sector, we can improve the flow of capital into an area where it is desperately needed. We look forward to working with Waterfund to bring this about.”

Scott Rickards, President & CEO of Waterfund said, “The principal reason behind our decision to work with IBM was their unique combination of expertise in the water sector combined with the best data analytics available. Our initiative with IBM will finally bring real financial transparency to the water sector. By calculating the unsubsidized cost of freshwater production using IBM’s Big Data expertise, Waterfund can offer the first flexibly-tailored financial tools to investors in water infrastructure. The Rickards Real Cost Water Index™ highlights the energy costs, interest rate risk, and capital expenditures required to build and maintain large-scale water treatment and delivery networks.”

Smarter Water Management Examples

Typically, investors have turned to the public equity markets to gain exposure to the water sector, with mixed results. The WCI is intended to provide a market benchmark and to spur the development of third-generation financial products for both water producers and investors and to aid the growth of the water sector globally.

Here are two examples of how it would work:

Scenario 1: A Water Agency cannot obtain bank financing for Phase 2 of a seawater desalination plant project due to previous cost overruns on Phase

1. Yet the Agency lacks the water it needs to supply a contractually specified daily volume of water to its largest customer, with a consequent risk of large penalties for each day of insufficient volume. Using strike and trigger values based on the WCI, the Water Agency could purchase a $25 million, 2 year insurance product.

Payout to the Water Agency would be triggered on the total change in its Water Cost Index (as well as some other conditions, such as a specified increase in asset failure costs).  This approach would enable the Water Agency to enhance its overall credit profile with the insurance enabled by the WCI, finance Phase 2 of the desalination plant and meet its supply obligations.

Scenario 2: A large desalination and water transmission system project needs to secure private equity and institutional funding alongside that from development banks and sovereign funds, to the tune of one third of the total project cost. To achieve this, the project needs a way to reduce risk to its investors.

Based on movement in the WCI, the project could purchase $50 million in insurance. This would enable the insurance product to then be underwritten by a large reinsurer and allow the project to secure the private sector contribution it needs in order to proceed.

Go here to learn more about IBM Smarter Water Management initiatives.  You can also go here to register for a report IBM prepared on why we need smarter water management for our world’s most precious resource.

IBM To Acquire Cúram Software

IBM has signed a definitive agreement to acquire Cúram Software Ltd. to help governments improve the efficiency, effectiveness and accessibility of social programs for smarter cities.

Today, IBM acquired Curam Software, a leading provider of social program software solutions, delivering best-in-class solutions for social enterprises globally including, health and human services, workforce services, and social security organizations.

Financial terms of the deal were not disclosed.

Cúram Software is used in more than 80 government agency projects around the world to provide the most appropriate social programs to citizens and their families in a timely manner, deliver services more effectively, and continuously monitor progress toward achieving people’s social and economic potential.

Who Is Cúram Software?

Cúram Software is the leading provider of social program software solutions, delivering best-in-class solutions for social enterprises globally including, health and human services, workforce services, and social security organizations.

Using Cúram’s solutions, agencies can immediately reap the benefits of client-centric business processes and an outcomes-driven integrated service delivery model Cúram’s solutions, underpinned by the Cúram Social Industry Platform, combines the advantages of software built specifically for social programs, an enterprise platform and service-oriented architecture with the business and technical flexibility required to allow agencies to implement solutions to meet their strategic objectives.

Cúram, which means “care and protection” in Irish, was founded in 1990 and is based in Dublin, Ireland, with offices throughout North America, Europe, Australia, and India.  One of the company’s investors was Enterprise Ireland, which helps Irish companies achieve global success.

How Is Cúram Software Used?

Cúram social managment software is used by health and human services, workforce services, and social security organizations around the world to deliver welfare, social insurance and both individual and employer based social programs.

It allows cities and governments to provide a single view of benefits and services available across agencies, levels of government and private and not-for-profit organizations.

The Social Industry Platform includes processes to deliver all types of programs and offers the flexibility needed to quickly update them as policy makers react to different economic times.

Cúram Software’s Platform also allows government and providers to focus on lowering overall program costs by ensuring that the benefits and services provided address core issues and that people become more self-sufficient.

Cúram And IBM’s Smarter Cities Initiative

Through its Smarter Cities initiative, IBM helps cities and governments serve citizens better by adopting more intelligent and efficient ways to analyze data, anticipate problems and coordinate resources.   IBM has led more than 2,000 projects to achieve these goals and through its acquisition of Cúram Software, IBM expects to extend its leadership in this area.

IDC Government Insights estimates the new Smarter Cities information technology market opportunity at $34 billion in 2011, increasing more than 18 percent per year to $57 billion by 2014.

Today’s news also builds on IBM’s Smarter Cities initiatives in Ireland.  Last year the company opened its first Smarter Cities Technology Center in Dublin at IBM’s R&D Lab,  where IBM works with city authorities, universities, small and large businesses to research, develop and commercialize new ways of making city systems more connected, sustainable and intelligent.

With the addition of the Cúram Research Institute — which is working to develop and deploy new business models for managing social programs — IBM will enhance its ability to help clients increase the social and economic potential of people and their families.“

We are working to help cities and governments at all levels transform the way they interact with citizens while improving efficiency,” said Craig Hayman, General Manager of IBM Industry Solutions.  “We all have stories to tell about standing in long lines or making countless phone calls to gain access to government services, but it doesn’t have to be that way.  Together with Cúram, IBM can transform the way citizens do business with government in a way that benefits everyone.”

Since 1999, IBM and Cúram have collaborated on federal, state, local, and provincial-level social program solutions around the world.  More than 90 percent of Cúram’s clients use IBM WebSphere middleware and nearly 70 percent of its clients use IBM hardware.  Cúram’s software is certified for use with the IBM Government Industry Framework and has been part of IBM Global Business Services’ Integrated Case Management solution since 2001.

“After 13 years of experience working with IBM, we know our companies are an excellent fit”, said John Hearne, CEO, Cúram Software.  “Many of our clients already use IBM technologies and services, and they will benefit from working with Cúram and IBM as one.  Through IBM’s global reach, we can grow our client base by bringing the benefits of Cúram’s Social Industry Platform to citizens around the world.”

IBM’s announcement of its plan to acquire of Cúram Software follows a series of moves IBM made this year to enhance its offerings for cities and governments.   In June, the company introduced the IBM Intelligent Operations Center, which provides a unified view of all city agencies so officials can predict events and quickly respond.  Shortly thereafter, IBM announced it planned to acquire i2, a leading provider of intelligence analytics for crime and fraud prevention.  The acquisition was completed in October.

After the acquisition is completed, Cúram Software will be integrated into IBM’s Software Group, which is a key driver of growth and profitability for the company.  Cúram has approximately 700 employees.

In addition to its headquarters in Dublin, the company has offices in Herndon, VA.; Toronto; Frankfurt, Germany; Canberra, Australia and Bangalore, India.  The acquisition is anticipated to close by the end of December subject to the satisfaction of customary closing conditions and applicable regulatory reviews.

To learn more visit www.cúramsoftware.com.

Tax Day

Oy, vey, it’s tax day!

Normally April 15th, you got a whole extra weekend to submit your return (or file for that extension) due to a holiday.

So no complaining!

I finished my taxes early this year.  Or, I should say, my accountant did.

I never thought I needed an accountant until he did my taxes and I compared it to what I did when I filed them using TurboTax (no offense to TurboTax).

When you go get surgery, you hire a professional, right?  Why should taxes be any different?

New York State’s Department of Taxation and Finance did just that when they turned to IBM recently to help them build the IBM Tax Collections Optimizer system.

This systems has helped NY State recover $83M in delinquent taxes thus far, an eight percent increase from 2009, and double the average increase in prior years.

The IBM Tax Collections Optimizer uses a unique combination of data analytics and other models to create action plans for each tax case.

The plan optimizes the order of activities agents will take to maximize the total amount of debts collected while taking into consideration the case load, personnel resources, and the anticipated effectiveness of the suggested actions.

For example, New York State saw significant improvements in the efficiency of their field agents in 2010 versus a year ago, with overall collections from field staff increasing by 12 percent, and dollars per staff day increased 15 percent across all its field offices, and more than 40 percent in the NYC metro office.

“With IBM’s unique analytics technology, the State of New York has recovered unpaid funds faster, more efficiently and more fairly then ever before,” said Stephen Lafleche, Managing Director of New York State for IBM, about the system. “In this economic environment, analytics technology is proving its worth by boosting tax collections, enabling states to increase revenue and invest in programs that ensure continued competitiveness.”

You can learn more IBM public sector solutions here.

And remember.  If you’re mailing your return, make sure you get that postmark by midnight tonight!

IBM Industry Summit: IBM Video Analytics For Smarter Government

As mentioned in my earlier post, I’ve been attempting to mix things up a bit, and lo and behold, as I walked around the Industry Solutions Expo here at the IBM Industry Summit in Barcelona, I had the opportunity to speak with Hans Kahler about how IBM is applying smart video analytics in the public sector, bolstering public safety and learning all sorts of things about video “events.”

Imagine this: A single security camera in a big city like New York or Chicago can capture upwards of 50,000 events, per day (car passing by, pedestrian walking by, etc.). How to make sense out of it all and separate the unimportant “events” from the critical ones?

Watch the video and find out!

Government Insight

Remember from my blogging coverage of IBM’s Information on Demand event in Vegas a couple of weeks ago IBM Global Business Services exec Frank Kern let the cat out of the bag about a couple of new business analytics centers that IBM would be opening?

One in London, centering on the financial industry.  The other in Washington, D.C., centering on the public sector.

Well, welcome to Washington.

On Tuesday, IBM officially announced the sixth in its network of analytics solution centers, this one dedicated to helping federal agencies and other public sector organizations extract actionable insights from their data.

Actionable insight out of Washington, D.C.?  Get the popcorn ready! (along with your filibuster rally hats!)

In all business analytics seriousness, the new IBM Analytics Solution Center in Washington, D.C., will draw on the expertise of more than 400 IBM professionals to apply breakthrough streaming technologies, mathematical algorithms, and modeling.

Using these tools, IBM will help clients optimize individual business decisions, processes and even entire business models, as well as manage risk and fraud and, ultimately, improve the delivery of public services.

The new center will be located in IBM’s Institute for Electronic Government at 1301 K Street, N.W., and will serve as the hub for collaboration with federal agencies, academia, and other institutions in the Washington Metro Area.

Expected analytics projects will range from transportation and social services to defense logistics and homeland security systems.

By way of example, among the analytics projects already underway with government agencies, IBM is working with the U.S. Special Operations Command (USSOCOM) to modernize the planning, programming, budgeting and execution functions within the command.

USSOCOM is the combatant command within the Department of Defense that provides fully capable special operations forces to defend the U.S. and its interests. The command also plans and synchronizes operations against terrorist networks.

The project consists of the design, development and integration of a Special Operations Resource Business Information System, which speeds access to information for the command.

Another project: IBM, the U.S. Social Security Administration (SSA) and MedVirginia developed a first-of-a-kind electronic records exchange system to shave the amount of time to receive medical records from weeks to minutes.

IBM also worked with SSA to build a predictive model using text analytics to help identify initial disability applications that are likely quick allowances and helped reduce the amount of time for a favorable initial disability determination on these applications from months to weeks.

The Washington-based IBM Analytics Solution Center, which specializes in the work of the public sector, is part of IBM’s business strategy to expand its business analytics and optimization capabilities and services globally.

IBM has opened five other analytics solution centers – in New York, Dallas, Berlin, Beijing and Tokyo — and expects to retrain or hire as many as 4,000 new analytics consultants and professionals globally as part of these centers.