Friday, November 8, 2013

Enterprise2013: Power Systems target Business Transformation for Success

Our blog, Solutions, open platform, commitment drive IBM Power System success[1], commented on IBM’s plans, strategy and solutions for Power Systems as announced in early October. At the recent IBM Enterprise2013 event, Doug Balog, General Manager for Power Systems, took the opportunity to expand on IBM’s Power Systems platform strategy for market success. It resolves around IBM’s ability to provide solutions that will make the transformation to Smarter Business operations faster, easier and more effective by using insights gleaned from Big Data-based analytics. Where the earlier piece focused on an overview of announcements and enhancements, now, we focus on the strategy and rationale driving IBM’s continued investment plan for success in the enterprise marketplace.

The IT market in the global economy is slowly lurching toward recovery. However, even the largest emerging markets (China, Brazil, Africa, etc.) once growing relatively rapidly, appear to be catching their breath. It’s no secret that the server market has become a difficult market. Currently, sales of intermediate servers like Power are flat to slightly declining. While some new contenders are performing adequately, many of the established vendors appear to be more focused on fighting a rearguard defense as they contemplate exiting the segment.

Taking a different view, IBM has been investing heavily in solutions based on the Power Systems platform. Given current trends, why take this position? No doubt one reason is the experience and insight gained through longevity in a market that has seen dramatic shifts in the past. The System i part of Power Systems was introduced 25 years ago (AS/400 in 1988). This makes it one of only two actively marketed proprietary system architectures. The other, the System z mainframe (49 years old), will be discussed in another blog.

But, longevity also argues against success as familiarity breeds boredom or exhausts innovation. To such arguments, Balog’s response is that the core of the market for Power System servers consists in large part of users committed to the platform. A core set that believe in the platform and want solutions based on it. They will also develop their own solutions for it. They want to implement clouds, deliver mobile services and apps, address security issues and leverage insights gleaned from Big Data/Analytics. Given motivation, they will use Power Systems. This is a phenomenon with considerable history in the IT market.

Doug’s team is committed to providing the motivation to the core and as many other users as they can attract. The ‘reasons to buy’ include the fast-time-to-value of integrated infrastructure, cognitive computing capabilities, intelligent applications, scalability, fully integrated solutions, Total Cost of Acquisition (TCA) and/or Total Cost of Ownership (TCO) advantages, etc. Such features drive sales, and the platform is designed to provide them. Here’s how they intend to do that.

IT users need systems and solutions that are adaptable enough to support multiple ways to develop and deliver services. High quality of service delivery and user experience provides significant competitive advantage. This requires infrastructure configurations matched to workload needs. Therefore, the Power Systems solutions come in a wide range of configurations and solutions packages. They range from Flex System components to PureSystems to Power servers to Watson solutions. All are designed for effective use in multiple configurations in cloud, on premise or hybrid operating environments. They provide access as a service for cloud, infrastructure, platform, applications and software at price points that match IT budgets.

Linux-based solutions are of high interest to this segment. Therefore, IBM is focusing on expanding the Linux-based solutions portfolio[2]. (System i and AIX remain as integral pieces in the strategy.) Another key motivator will be the availability of next-generation solutions using Big Data and sophisticated analytics to drive business success. Big Data provides significant opportunities enterprise transformation. It enables competitive advantage by improving decision making with faster data analysis. It enhances the quality of customer interactions, even make possible the elusive task of treating each customer as an individual.

But, providing such a range of choices complicates decision-making. Integrated, targeted solutions pre-built and ready-to-run simplify choice. One example is the IBM BLU Acceleration Solution that supports in-depth Big Data business intelligence and data warehousing applications. Other solutions provide predictive analytics that help avoid capacity problems, one that speeds cloud implementation, and one that optimizes virtualized infrastructure management. Another example is IBM Watson, which launched the era of ‘cognitive computing’ and is driving radical change in medical research, teaching, practice and personalizing the service experience in finance and retail operations. See our earlier blog or IBM Power Systems[3] website for more information.

In short, Balog, and IBM, believe they will win with Power Systems built as open, standards-based, feature rich platforms matched to the workload. They are designed to leverage the latest technologies to solve pressing problems and making it easier for users to develop solutions. They offer end-to-end industry-specific solutions with exceptional business and predictive analytics. They will grow cognitive computing. Finally, they foster open, collaborative development through the OpenPOWER™ Consortium.  

If the strategy and tactics sound vaguely familiar, it is. Doug admits his strategy is styled on what System z accomplished by aggressively promoting targeted solutions and Linux on z. We think this is a very reasonable strategy. After all, IBM has a good track record with this platform. Power is a major part of the very well received PureSystems family. Power technology is at the heart of cognitive computing in Watson – which is creating and expanding markets already.

The big question: Will Linux-based Power Systems turn the tide in servers? Market signals aren’t encouraging today. No other vendor has tried as aggressive a commitment. You can’t force a customer to buy something. But, offered the right products, they’ll buy. IBM’s focus on speeding and facilitating value realization sounds right. There was a lot of skepticism about Linux on the mainframe, both about the platform and the Linux strategy. IBM won big there. We think Doug has a better than even chance of succeeding.