Feb 2, 2012

IBM's Social Business Gambit - What do I think?

In my last post I outlined what I consider IBM’s Social Business gambit coming out of the Lotusphere/Connect 2012 conference this month. But I really didn't get into my opinions whether I think it will work. So, here goes...

Am I buying it?
Yes, the message. The IBM Social Business gambit and re-brand away from the Lotus marque is primarily a marketing message. Overall IBM clearly articulated and streamlined its message on the communications/collaboration tools market. I think this is a very good start. Quite frankly, given the current market and competition, it’s about the only option IBM had. The good news is that they are doing it.

To expand, IBM’s Social Business market strategy is a re-tooled perspective on where communications/collaboration has been heading for a long time. Bottom-line, the problems we trying to solve are not new; just there’s new technology to help us get things done. As Linda Stone explains we be been moving through evolutionary phases of technology changing how we work. Right now were evolving towards understanding our information by being able to use it more effectively:

Today, we are Knowledge Workers evolving into Understanding Workers.  Understanding Workers use technology to anticipate, judge and act.

This idea fits nicely with Sir Tim Berners-Lee’s Lotusphere keynote in which he spoke about being on the cusp of the semantic web. Longstanding technology that has served us well is fraying at the edges in a continually connected, multi- device, big data working world. Information management is going from find-ability to connect-ability.

The problem for most enterprises is how to provide for Understanding Workers and what it means operationally. That’s what IBM is attempting to address by shifting the conversation to Social Business and away from why e-mail stinks. Changing the topic reboots the conversation and refocuses the issues to the cultural shift that enterprises need to go through to get to the other side. So am I buying the changed conversation and the idea of the social business? Yes.

Will companies buy it?
Hard to say, but customers are looking for innovation, and that usually is a new conversation even if the problem is the same. Social software solutions are not streamlined today, although many are coming closer (e.g., Salesforce.com) or are well enabled to do so (e.g., Jive’s December 2011 $120M IPO).  But just when the business begins to take an active interest in the technological culture of the firm, the way workers access information and each other has exploded into a complex matrix of devices, technologies, and solutions.

Delivering a reassuring message about how IBM understands enterprise issues and providing understandable approaches to new technology complexities offer customers a sound starting point. IBM has got to feel confident about it, and it’s clear that they do.

However, it is a guarded IBM installed-based that IBM is running this by first. A market message is only good if it garners interest; the success of a strategy is in the technology execution and delivery. Redefining the conversation and demonstrating what life might be like only goes so far. Success depends on whether or not customers can comfortably replicate the experience being demonstrated to them.

Will IBM win?
They way I see it, IBM has three hurdles to clear in order for the social business gambit to pay off:

1.     Technology delivery
2.     Market disruption
3.     New competitors

Proof of the technology is in the execution. IBM needs to stay the course and execute its technology and delivery well. I didn't get to see the technical presentations at Lotusphere/Connect 2012. Combine that with IBMs increasing coyness to reveal the inner workings of its technology and it's hard to for me honestly evaluate whether the technology is sound. Given IBMs performance over the last 4 years I am cautiously optimistic.

In its last major communications/collaboration software change-up IBM effectively sold the message of a new beginning to many customers. The long awaited Domino 8.0 and the Eclipse-based client (delivered in August 2007) provided a B12 perception booster for customers eagerly awaiting improvements to a haggard code-base. The message worked, staving off customer defections temporarily, but the technology of the updated system was not as promised. This caused a lot of buyer’s remorse and IBM struggling to keep its customer-base intact.

Even the die hard, bleed yellow folks were exasperated. Attributed by some to the offshoring of development and the decimation of the US development and QA, the execution of the early Notes/Domino 8.0.x code stream opened the doors for competitors and other IBM Lotus technologies (i.e., Connections) to swoop in and displace the Lotus crown jewels. Note, general consensus is that the 8.5 release of Notes/Domino at the end of 2008 was much more stable as are subsequent releases, most recently version 8.5.3 released in October 2011.

More recently IBM has placed its marketing focus on the front end and user experience of its communication/collaboration tools. This approach has been successful in capturing the attention of the business buyers, however, the once-bitten, twice shy effect of unrealized Domino 8.0 promises has left a degree of skepticism in customer’s minds that IBM continues to contend with.  

Which comes to market disruption. A frustrated customer-base makes for easy fishing by competitors, and both Microsoft and Google have been casting long lines with varying success. For IBM to succeed it needs to be disruptive enough not only to stop this feeding frenzy and but also for its competitors to stop writing IBM off.  IBM needs to make it a goal to get its competitor’s sales reps to start complaining about IBM disruption.

On the one hand IBM could simply write off the likes of Cisco, Google, Microsoft and Oracle as being behind the social times, however that would be short-sighted since these business have large customer bases in other areas that can be leveraged for new technologies, no matter how passé their messages seem.

It’s not only the usual suspects that comprise the social IT market. IBM, by changing the discussion, wittingly or not, jumped into a competitive pool that includes a new breed of providers. In addition to the known entities, IBM will need to fend off a variety of social software sharks including, Jive, SocialText, Salesforce.com, and Yammer.

The competition boils down to gaining the attention of customers – existing and new - enough to be disruptive. With this many players the market share will be diluted until acquisitions and dropouts consolidate the market place. Until then IBM will need to gain the attention of customers that have lots of choices and little (for now) internal direction on where to go.

Final words
Overall my analysis is, it depends. It depends on what IBM can and will deliver. It depends on whether or not IBM can become disruptive enough to gain new customers in a crowded market place. It depends on if IBM can compete against a new breed of competitor.

Ok, pretty wishy-washy, but here’s what I will say. IBM’s Social Business message is a good start to driving the mindset of the market, and if IBM manages to get it to trickle into its sales and development ranks, then IBM is on the right path to restoring customer confidence and sparking innovation. Since the social market is hardly a vacuum these days, IBM will need to get more down and dirty to influence things. Although I am doubtful about the likelihood of IBM doing this, a couple strategic acquisitions would go a long way to thinning the competition and is likely to gain customer confidence in IBM’s commitment to social business.

I predict that IBM will succeed in attracting business buyer interest with its Social Business message but it will likely stumble on the same hurdles that have challenged IBM in the past, including staying on message throughout the IBM organization; a cultural shift that IBM has yet to accomplish.

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