IBM Partners See Growth In Big Blue's $4 Billion Cloud, Mobile, Analytics Investment

Partners cheered IBM CEO Ginni Rometty’s $4 billion pledge to bolster its cloud, mobile and analytics business. Unlike investors who have grown weary of IBM’s poor financial performance, Big Blue partners said they see the big IT picture and maintain Rometty is steering IBM in the right direction -- albeit slowly.

"The industry is changing so quickly. It’s clear that IBM is having troubles," said Debbie Fitzerman, president of DFC International Computing, a small Toronto-based SaaS provider and IBM partner. "IBM isn't nimble enough to make the type of quick moves it needs to pivot with the industry. It's getting there, and $4 billion and a nimble partner community can make a big difference in pushing it faster in the right direction."

On Thursday, Rometty told a group of investor analysts the $4 billion investment in cloud, mobile and analytics will, in return, deliver $40 billion in annual revenue for those lines of business by 2018. In comments made to the media, Rometty made no apology for shrinking IBM’s sales from $98 billion in 2013 to $93 billion last year.

[Related: Winds Of Change At IBM: Will Partners Be Blown Away?]

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"Much of the decline in revenue has been engineered by us," Rometty said at IBM's annual investors meeting in New York. "We restructured the hardware business, and it is now less than 10 percent of the company, and we returned that business to profitability."

The meeting comes on the heels of IBM's reorg, designed to break down walls between business units and more tightly align core IBM businesses, including SoftLayer, Watson, security, mobile, systems, services and analytics, into a unified solution.

Rick Bailer, senior vice president of sales at Sirius Computer Solutions, said, from the top down, IBM's leadership gives him confidence that while the company has hit a few bumps with its massive transition, it's now pointed in the right direction.

"IBM is making the right investments in security, software and cloud, and they have an impressive executive team to help partners grow their business," Bailer said.

Fitzerman said, as a smaller partner with growing cloud and mobile business, she's cautiously optimistic to hear of IBM's billion-dollar commitment to growth markets. "Where is IBM going to invest that money? Is it headed to marketing fluff or bean counters? Or is IBM going to get serious about support and helping partners?" she asked. "Right now, when a partner needs help we are directed to offshore IBM support techs reading from prompts. If they fix that, then I grow my IBM business."

Over the past several weeks, as IBM has taken its reorg message to the partner community between PartnerWorld and InterConnect conferences, Bailer said he has been impressed with the executive lineup who are charged with delivering on IBM's aggressive goals.

Brendan Hannigan, general manager, IBM Security Systems; Bob Picciano, senior vice president, IBM Analytics; and Tom Rosamilia, senior vice president of IBM Systems, to name of few, he said, are firing on all cylinders poised to move IBM forward in the wake of two major divestitures of its x86 server and chip manufacturing businesses.

"IBM has planted the seeds organizationally and leadership-wise to help partners move in the direction the industry is moving. Hardware is becoming a smaller part of what delivers the highest value," Bailer said. "What we are hearing is IBM needs partners more than ever to deliver on IBM's solution message. IBM needs the partner feet on the street."

Partners, such as Bailer, argue while IBM's z system business, storage and power businesses are far from inconsequential and still represent a meaningful percentage of revenue, it's security, software, services and cloud that represent IBM's biggest emerging opportunities. IBM, partners said, is now reorganized to deliver more comprehensive solutions that pull from a wider range of IBM's portfolio, as opposed to individual products.

"Take a look at cloud. IBM has an advantage with their SoftLayer cloud offering, which focuses on applications and solutions," Bailer said. "It allows IBM to leverage tools, such as Bluemix, and IBM's vast portfolio of software."