Before I Forget…

IBM is doing something right.  Last week even the unstoppable Google stumbled, failing to meet the lofty expectations of its cheerleaders.  Microsoft too delivered mildly sub-par numbers in its fourth quarter as it felt the effect of a faltering economy.  But IBM sailed calmly on, producing its third successive strong quarter.  It is tempting to simply put this down to the resilience of Big Blue’s model.  Only about a third of revenues are now made in the US.  Half of sales come from services that produce reliable income year in, year out: such as outsourcing, or maintenance of the massive mainframe computers that the group still builds.  Yet the performance – second-quarter sales growth of 13% year-on-year – should be seen in the context of five years of re-engineering at IBM.  The move towards offering an integrated mix of IT services, hardware and software did not start well.  IBM’s purchase of the consulting arm of PwC in 2002 serves as an excellent example of how extremely difficult it is to integrate people-based businesses: as cultures clashed, the intellectual capital walked straight out of the door.  At the same time, offshoring exploded, and aggressive pricing from domestic rivals such as EDS and Indian competitors killed margins.  Since then, however, IBM appears to have slowly mastered the model of an integrated hardware, software and services supplier.  Commodity businesses such as PCs and printers have been sold, while the group has spent money expanding in software. It has shifted closer to customers in emerging markets, while concentrating on higher value areas such as security, instead of just simple labour outsourcing.  The plan, laid out in 2007, to grow earnings at an annual rate of 15% out to 2010 through a mixture of cost cutting, acquisitions and organic sales growth is very much on track.  For an octogenarian, the world’s largest IT services company has a remarkable spring in its step.

Reference : http://www.ft.com/cms/s/2/2be8f57c-568a-11dd-8686-000077b07658.html

Cool graphic -

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Very interesting graphic.  Appeared in The Guardian newspaper on Feb 1st 2008.

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Business leaders are gaining influence in BI purchase decisions, the advanced analytics market is showing signs of pent-up demand, and text mining is becoming a core capability.  These are three of the most notable conclusions of IDC’s latest annual business intelligence software sales report, released late last month.  Despite gloomy economic news in recent months, the report forecasts continued growth in BI software sales.  IDC’s report, “Worldwide Business Intelligence Tools 2007 Vendor Shares,” concludes that the total BI market grew 12.1% last year to reach $7.05 billion.  The performance marked a third straight year of 12% growth, and according to report co-author Dan Vesset, “the biggest point is that BI is starting to get to the mass market.”  Pointing to recent IDC qualitative research on “Best Practices in Pervasive BI,” the analyst reports increasing line-of-business and corporate executive influence over BI purchase decisions.  “One leading indicator of new BI projects these days is executive turnover,” Vesset explains.  “When new regimes come in, there are usually requests for more information, and for better and faster access to that information.”  Mainstream demand is also being fueled by a growing body of popular business literature on BI, says Vesset.  “Whether it’s the “Harvard Business Review” or “The Wall Street Journal” or books, such as Tom Davenport’s Competing on Analytics or Ian Ayres’ Super Crunchers, there are many sources that are now calling attention to BI.”

IDC breaks the total BI market into two segments.  The “BI Query, Reporting and Analysis Tools” segment grew 11.9% to reach nearly $5.7 billion in sales in 2007, IDC reports.  Microsoft and SAS, the fourth- and fifth-largest vendors in this segment, had the fastest growth among the top-five vendors at 15.4% and 18.3%, respectively.  The “Advanced Analytics Tools” segment grew at a slightly faster pace of 13.1% to reach nearly $1.4 billion in 2007, according IDC.  SAS continued to dominate the segment with 32% of the market, but SPSS and Microsoft, the second- and fourth-largest vendors, had the fastest growth among the top-five vendors at 17.8% and 20.0%, respectively.

 
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In theory, the smaller Advanced Analytics segment has greater potential for growth, “but we’re just not producing enough statisticians and quantitative analysts for organizations to buy into this technology,” says Vesset.  “The results suggests there’s even more demand for analytics, but to bring it to a broader audience of business analysts, I think we’ll have to dumb it down a bit by packaging canned models for specific markets such as retail.”  Another technology seeing increased demand is text mining, says Vesset, with applications blossoming in areas such as voice-of-the-customer analysis.  Vendors including Business Objects, SAS and SPSS have responded with recent acquisitions and product releases aimed at combining text mining and data mining techniques.  “The two camps of structured and unstructured data analysis remain very separate,” says Vesset.  “It’s important for vendors to respond because if the products aren’t there, it makes it harder for practitioners to invest in the technology.”  Predicting steady demand, IDC’s report concludes that “although the worldwide economy is experiencing a slowdown that is affecting overall IT spending, IDC does not expect a slowdown in the BI tools market similar to that of 2001-2003 [when growth slowed to the 2- to 7-percent range].”  Vesset says IDC has lowered its short-term forecasts “just a bit” in recent months, but he adds that the mainstreaming trend and the emergence of a new generation of BI-savvy business leaders will encourage long-term growth.  “Babson, Bentley, Boston University, MIT and North Carolina State are just a few examples of schools that have been offering coursework and programs specifically around BI,” he explains.  And as these new leaders rise in the corporate ranks, “it signals an opportunity to ask for funding for the BI initiatives that may have been denied in the past.”…..

Reference : http://www.intelligententerprise.com/showArticle.jhtml?articleID=208802671

This is a crazy-good idea.  Brilliant new way to blow past the limitations of emoticons.  Check it out.

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