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IBM CEO Arvind Krishna: Digital Transformation Accelerating In Wake Of Global Pandemic

Krishna ‘is making a positive impact in how IBM interacts with its customers and partners,’ said one solution provider CEO, who is projecting strong growth in IBM-related revenue this year.

IBM CEO Arvind Krishna says he expects that the amount of digital transformation set to take place over the next two to three years would have taken far longer to accomplish if it wasn’t for the events set into motion in 2020.

“What we have witnessed over the past year is an acceleration of digital transformation,” Krishna said in a recently released letter to investors. “Every company in every industry wants to build a much stronger digital foundation to fundamentally change the way its business works. There is no going back. In the next two to three years, we expect to see digital transformation at a rate that, before 2020, we thought would take 5 to 10 years.”

[Related: IBM CEO Arvind Krishna’s ‘Deeply, Deeply Passionate’ Plan To Make IBM-Red Hat No. 1 In Hybrid Cloud, AI]

And IBM expects to play a central role in the accelerating digital transformation work, he said. Ultimately, IBM “is positioned to lead as we enter the era of hybrid cloud and AI,” Krishna said.

IBM’s cloud-related revenue grew 20 percent to $25.1 billion in 2020, year-over-year. Cloud now represents more than a third of the company’s total revenue.

Helping IBM’s leadership position in hybrid cloud and AI are a focus on Red Hat OpenShift, reimagining workflows with AI, marketing with industry clouds, growing cloud consumption and working with partners, among other factors, according to his letter.

At Boston-based Ironside Group, CEO Tim Kreytak said he agrees with Krishna’s strategy of focusing in on areas including hybrid cloud and AI

COVID-19 has accelerated companies’ digital transformation and cloud adoption plans from a three-to-five year plan to a 12-to-24 month plan -- and sometimes even sooner, said Kreytak, who is also the co-founder of Ironside Group, an IBM Premier Business Partner.

The increased demand for hybrid cloud and AI has Ironside projecting a 10 to 15 percent increase in its IBM business across software and services for 2021, year-over-year, Kreytak said in an email.

Overall, Krishna “is making a positive impact in how IBM interacts with its customers and partners,” he said. “To Ironside, early returns certainly signal a shift in the right direction.”

Ironside has also made its own investments in answering customers demands for AI. In January 2020, Ironside introduced “Ascend AI,” a packaged service for customers in the early stages of establishing AI.

“Accelerated digital transformation and the desire to leverage AI to improve efficiency while reducing risk are top of mind for many of our customers,” he said. “Our goal with this service is to make these first steps much more attainable.”

To help with speeding up hybrid cloud consumption, IBM has “elevated the role of partners,” Krishna wrote in the letter to investors. The company is also adding hundreds of new partnerships with global system integrators, independent software vendors and major third-party software partners, he said. “We are investing $1 billion in our ecosystem so that our partners can play a much bigger role in fulfilling the many needs of our clients,” Krishna wrote.

Krishna recently told CRN that expanded focus on partners comes with IBM simplifying its go-to-market model and betting bigger on the partner ecosystem, with the number of customer groups at the company being reduced from from 50 to just two.

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