Integrating IBM

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If you looked simply at his resume for the past few years, you might conclude that he has trouble holding a job. But in fact, Mike Borman, appointed vice president of sales for IBM's Software Group last week, has emerged as something of a troubleshooter within IBM.

For example, after returning to IBM from a brief stint as president of CRM application vendor Blue Martini, Borman, as IBM's worldwide channel chief, in 18 months overhauled IBM's much-vaunted channel program to the point where it now dominates both the CRN Channel Champs and VARBusiness Annual Report Card (ARC) awards. Then he moved on to become general manager of IBM's troubled iSeries unit six months ago and is now taking on the task of reinvigorating IBM's $13 billion middleware empire.

That empire will continue to be run by Steve Mills, the group's general manager. But while Mills is long on technical vision, he is short on tactical execution. The end result of that has been an IBM Software empire that has lots of piece parts that are not very well-integrated and, more telling, a pretty low attach rate when it comes to selling multiple IBM software products into the same account.

Worse yet, there is a lot of conflict between IBM Software and the rest of the IBM sales force, IBM Global Services and IBM's partners. And to make matters even more complicated, there is a fair amount of conflict among IBM partners, many of which are clamoring for a more structured approach to deal registration.

Borman's first challenge will be to clean IBM's fractured software sales effort, where all too often IBM salespeople who have never met one another show up at the customer's site pushing different products with conflicting stories. This leaves both the customers and the solution provider that brought IBM into the account shaking their heads in bewilderment, especially when nobody actually takes any responsibility for fulfilling pledges made to the customer.

Given his time as IBM worldwide channel chief, Borman is all too familiar with this side of IBM. In fact, the software group at IBM was the only group that marginally participated in the grand, unified channel plan that Borman outlined in 2003, supposedly because it needed years to adjust its longer sales cycles to the new plan. The translation for that is with so many IBM software people participating in deals strung over multiyear contracts, IBM's Software Group probably has one of the highest cost-per-sales ratios in the business. Streamlining that mess to the point where fewer salespeople can sell WebSphere, Tivoli, Notes and Rational software as part of a solution set is still going to take years, but Borman is probably only one of handful of executives with the skills needed to clean up the mess.

The other, of course, was John Swainson, who prior to Borman briefly held this job before exiting to become president and CEO-elect of even more troubled Computer Associates. Swainson is credited with much of IBM's success around WebSphere, but he was unable to make any real progress running IBM Software sales because he only had the job for a few months before taking the post at CA.

What makes Borman--who is more reminiscent of Clark Kent than Superman--likely to succeed is that he's a quiet, thoughtful, unassuming guy that listens to people and has a relentless focus on getting the task at hand done. And given a relationship with IBM CEO Sam Palmisano that harkens back to their days together at IBM Japan, Borman has the juice inside IBM to move mountains. And if he succeeds here, the impact that realigning this business would have on IBM's overall profitability would make him a strong contender to one day be the CEO of IBM.

In the meantime, Borman has the knowledge and credibility in the channel to bridge that gap between IBM's Software Group, the direct-sales force, IBM Global Services and the rest of the IBM channel. For many of IBM's competitors, it has been IBM's inability to bring all of its software resources to bear--as much as their own innovation--that has allowed them to succeed. Borman will go a long way to make sure that it is not IBM mistakes that will allow competitors to win deals.

And once that begins to happen, the effects of those efforts will be felt first at BEA, Oracle and Microsoft, followed by Hewlett-Packard, Dell and Sun as they try to cope with an IBM that is just beginning to flex its real bundling might.

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