CRN Interview: Doug Elix, IBM Global Services

Doug Elix, senior vice president, group executive at IBM Global Services, answered questions from in an e-mail exchange

CRN: What is the role of solution providers as IBM Global Services moves forward with the on- demand computing initiative?

ELIX: IBM's e-business on demand initiative addresses clients' need to increase their productivity and enhance their business performance. As business models shift toward horizontal integration, the underpinning infrastructure--the hardware, the software, the storage--needs to be architected differently to support these new models.

Given these shifts, clients will be looking for different ways to access, manage and buy technology. To continue to meet our clients' needs, we must share our industry experience and offer technology that transforms business for competitive advantage. Our reseller/solution provider Business Partners need to increase their consultative selling and solution-selling skills. They also have to understand their customers' industry and business processes, and know how to improve productivity in their customers' organizations. IBM will continue to develop offerings that will be enhanced by the skills of our partners, and customers will continue to acquire hardware, software and services as they apply technology to solve their business challenges.

CRN: Talk about the impact the IBM Global Services Principles of Engagement have had on the field engagements between IBM and solution providers.

ELIX: We are encouraged by the preliminary results and feedback we have received on the Principles of Engagement, but there's more work to be done. A key component of the [Principles of Engagement] was the creation of IGS Business Partner Advocates, a new role within IBM to address issues and concerns that cannot be resolved satisfactorily in the field. The feedback from our Advocates is that Business Partners are aware of IGS' intent to improve its relationship with them, and are now bringing up the Principles of Engagement during sales opportunity discussions as a point of reference, thereby reducing the risk of conflict--exactly what the [Principles of Engagement were] intended to do. Business Partners have also told us that they are experiencing much stronger and proactive contact from IGS.

CRN: What kinds of partnering data are you seeing with regard to IBM and partners in the small-business and midmarket segments?

ELIX: According to a RoperNOP Technology study, approximately 57 percent of IGS Business Partner revenue comes from customers with fewer than 1,000 employees. And, according to IBM research, solution sales account for 65 percent of the total opportunity in medium business, with solutions spending in medium business growing twice as fast as the overall medium business IT opportunity. In addition, midmarket customers prefer to buy from regional/local service providers. This indicates that Business Partners with a services and solutions orientation have a tremendous opportunity to grow their businesses in the expanding SMB market.

CRN: Compare the IBM Global Services partnering strategy to the strategy being pursued by Hewlett-Packard, EMC and others.

ELIX: The key difference is that IGS' partnering strategy is more mature than that of our competitors. We have simply been developing services relationships with Business Partners longer, and therefore have more innovative approaches to teaming. In addition to the Principles of Engagement, other initiatives designed to strengthen the relationship between IGS and Business Partners include:

Teaming relationships with regional system integrators at the territory level.

Financial management workshops to help Business Partners decide when to build their own services capabilities and when to resell IGS' services.

Clarifying routes-to-market of offerings.

Providing Business Partners a PartnerWorld Portal.

CRN: What is the big challenge that IBM Global Services faces as it moves to work more with solution providers in the small- and medium-business segments of the market?

ELIX: As Business Partners expand their own services capabilities, IGS will need to help them strike a balance between reselling IBM services vs. building their own services offerings. Together with our Business Partners we must continue to drive complementary and innovative teaming approaches to grow and win in the SMB market.

CRN: Talk about the reselling agreements IBM Global Services has with other vendors such as Sun Microsystems and what impact that has had on the organization?

ELIX: IGS is platform-agnostic and does not offer increased incentives to IGS consultants and principals to include IBM software and hardware in a customer solution over the offerings of other vendors, despite claims by some industry executives to the contrary.