IBM Canada Ltd. announced what it describes as a major shift in its strategy to help customers automate and manage business processes tailored to their industry.

Big Blue on Thursday launched 62 middleware solutions for 12 industry

sectors, including automotive, banking, consumer product, electronics, energy and utilities, financial markets, government, health care, life sciences, retail and telecommunications.

Middleware solutions for retailers, for instance, include merchandising, item management, inventory management, store operations, multi-channel management, advertising, marketing and promotions.

Demand from customers and partners drove changes to the way Markham, Ont.-based IBM Canada packages its middleware products, said Noel Paterson, director of software sales for IBM Canada.

“”Customers are saying, ‘We know you know IT. We know you know hardware and software. We know you know services. We need to know you know our business,'”” said Paterson. “”‘That’s what we really value. That is what distinguishes you, IBM, from your competition … Don’t talk to me about general IT solutions.'””

By the same token, business partners look to IBM to take care of certain details, explained Paterson. Using Toronto partner Globalmaxx Technologies as an example, he said: “”They didn’t want to be spending their development efforts building adapters and hooks into our middleware. What they really want to do, and what allows them to charge a higher rate for their customers, is they want manufacturing expertise.””

The expertise built into IBM’s new middleware comes from insights derived from its business partners and advice given by the consulting arm of PricewaterhouseCoopers, which IBM bought in 2002, Paterson said.

Although no Canadian organizations are using IBM’s new industry solutions as a bundle yet, some IBM customers have used pieces prior to today’s official global launch.

Kristina Vermer, project officer of the Connecting Windsor-Essex portal in Ontario, said Windsor-Essex began using solutions that are now part of IBM’s e-government vertical products. The portal is based on WebSphere Portal 4.2 with a complete Lotus collaboration suite.

Vermer said the Windsor-Essex community is already “”IBM-rich”” with products like DB2, Tivoli Access Manager and WebSphere. She said because Windsor-Essex’s stakeholders also fall into the health care and education sectors, “”clearly there are other areas of IBM’s package of middleware solutions”” that can complement the community’s portfolio of products.

IBM does not provide a breakdown of the specific investment dollars poured into the development of the 12 new software products, said Martin Wildberger, vice-president of industry solutions and director of the Toronto lab, IBM software group.

But the wider market is lucrative, with last year’s global opportunity in the solutions industry in which IBM competes valued at US$450 billion and growing at a rate of eight per cent, according to the company.

In Canada, 2003 figures from IDC Canada showed financial services companies spend the most money on information technology (18 per cent). This is followed by manufacturing (15 per cent), government (13 per cent), business services (11 per cent), telecom and media (10 per cent), home (nine per cent) retail and wholesale (eight per cent), three per cent each for primary resources, health, education, transportation and utilities, and construction (one per cent).

IBM’s practice has been to spend annually more than US$1 billion and acquire companies like Rational and Trigo as ways to build its middleware platform, explained Wildberger.

The impact of these decisions can be seen in the “”market share success”” of IBM Canada’s middleware line, said Wildberger. For instance, WebSphere has 62,000 customers and more than two million developers; DB2 is used by more than 425,000 data management customers, has 14,000 business partners and 40,000 independent software vendor applications; and 22,000 customers use Tivoli Systems Management while 60 million users license Tivoli Access Manager.

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