IBM seeks ISVs with open standards approach

This week, IBM is hosting a merger of its annual developerWorks event with the user conference of Rational, a software company it acqiured last year. on Monday spoke to Buell Duncan, general manager of ISVs and developer relations,

to learn more about the business issues motivating the acquisition and its partner roadmap. It was mentioned earlier at the conference companies want to get more value from their investments over the last 10 years. What’s driving this?

Buell Duncan: Competitiveness in the market. It’s how you integrate with suppliers. It’s how you integrate with customers. It’s internal process effectiveness and efficiency and external connections. At the same time, as you heard from (general manager, developer relations) Mike Devlin, software is going to enable it. It’s different from perhaps a decade ago or five years ago. What other major issues are affecting your business?

BD: The second sea change that is occurring is software companies are choosing the architecture for the future. There’ll never be just one. But the question is will it be more of a world that is based on open standards, or will it be a world that is proprietary-based and .Net? And those decisions are going on right now.

What’s exciting to me is that what customers are demanding as they re-engineer their business is the fact that integration becomes so important. And integration across different platforms and the ability to run multiple environments, which would drive this notion of open standards. So we’ve been making very significant investments to build partnerships with ISVs, large companies and industry-specific solution providers…small niche solutions providers and also to reach out and build this ecosystem of developers. The PartnerWorld Industry Networks has been around for four months and has attracted more than 900 ISVs. What has been the appeal and how do you expect the program to expand?

BD: What we’ll do in the next month or so is begin to…link not only the name of the customer, but then specifically to a solution profile of their applications. And then by the end of the year, we’ll be able to have even an external customer say, ‘I’d like to find out more. Can you call me on this?’ We can do that today, but this will all be automated. We’re surprised and delighted that this number has grown as quickly as it has. We’ll add additional industries as we go forward, and I would expect from that, and from growth in the industries that we have today, we’ll see growth continue.

We have announced banking, financial markets, retail, telco, life sciences, health care, government, insurance. We have eight today. We will announce automotive shortly. I suspect we’ll end up with a dozen or so. What is IBM looking for in a partner?

BD: If you look across the IBM company — (how we have) our ISV programs set up — we are looking for those companies that are most relevant in the marketplace and most committed to embracing open standards. So if you were to draw a little graph, you would say we want to prioritize our efforts around those who are obviously either big players or have leading, industry-specific solutions or are leaders in their local region and geography.

We are also reaching out to the venture capitalists, working closely with venture capitalists. And beginning this fall, we’re going to ratchet up our efforts there as we do programs around the world with the VC community, asking them to bring in their portfolio companies. We’ve done some of this, and it’s really been well-received. Obviously we are very interested in working with them because these could be the future solution leaders of tomorrow. IBM bought Alphablox last week. How does this firm complement Rational and other ISVs you have acquired over the last while?

BD: I’m probably not the best person to talk to you about the specifics of it, but what we will do and will continue to do (is focus on) technologies that complement IBM offerings, that build out, if you will — and there are technologies that Alphablox has in the BI space that build out some of our data management solutions. What challenges did you tackle absorbing Rational?

BD: Mike Devlin said today the integration is behind us. We did this at high speed, fast pace. And as Mike said, it was certainly for their team a transition that was not easy obviously. But it’s one that we’ve made enormous progress on. Little things. (For example), this conference. Going to one conference (from separate Rational and developerWorks conferences.)

Taking our partner programs and expanding our partner programs now to encompass Rational are very positive things as we go forth. The things that Rational helps the IBM company with – not just building out a stronger set of offerings – but how we do software development ourselves across the company. IBM has one of the biggest R&D arms in the world, so what is the incentive behind making all these acquisitions?

BD: Customers. You always, in business, will decide, ‘Am I better off to build it or to acquire it?’ And if you look at the numbers of — you know, we lead the world in patents, we spend (between US$5 billion and US$6 billion) in research and development — but having said that, there are places and times where it makes sense rather than try to build everything yourself. Our partnership programs are about increasing our reach in the marketplace. But clearly one of the benefits is also we then began to see technologies that can complement our own. We don’t have partner programs because we’re just wanting to get a shopping list of companies to buy.

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