IBM reorganizes channel with vertical focus

LAS VEGAS — IBM Corp. plans to announce Tuesday at its PartnerWorld show in Las Vegas a reorganization of its business partner program, instituting an industry focus on an organization traditionally arranged around products.

IBM will now group its ISV (independent software vendor) partners into networks by industry and tailor its communications and partnership programs to the various verticals. The move is intended to make it easier for ISVs to access the information and contacts they need from IBM, according to Scott Hebner, IBM’s vice president of marketing and strategy for developer relations. The first six verticals for which IBM will introduce the program are retail, financial services, banking, telecommunication, life sciences and health care, he said.

The move is part of IBM’s company-wide effort to tailor and bundle its products to meet the specific needs of its customers on an industry-by-industry basis, and to build its channel strength through better geographic and vertical targeting, Hebner said.

“This is very much a reflection of what the customers want us to do, not just the ISVs,” Hebner said.

The new vertical channel networks are a continuation of changes IBM began last year, when it introduced ISV Advantage, a program that offers IBM’s top midmarket ISV partners an array of marketing and support services in exchange for a commitment to lead with IBM for at least 60 percent of their outside software, hardware and services needs. IBM relies on its partners to provide customers with applications, which the company generally does not develop. IBM’s strategy is to partner with application vendors and provide for those vendors’ customers their underlying hardware and middleware infrastructure.

One ISV Advantage member, Interchange Solutions Inc. President Mark Durst, said the program has been very useful in allowing his company to more quickly access needed IBM resources.

Markham, Ontario-based Interchange makes a Lotus Notes-based CRM (customer relationship management) system for midmarket financial services companies. The company has been an IBM partner for years, but the last six months of its relationship with IBM have been the best, largely thanks to IBM’s new approach to working with partners, Durst said.

“What’s totally different this year is that they sat us down and said, ‘Let’s create a plan together,'” Durst said. “IBM’s now being proactive, as opposed to reactive, and saying, ‘Let’s attack the market together as part of a larger group.'”

ISV Advantage offers participants a single contact person for working with IBM, a feature Durst said has been the largest factor in improving his organization’s dealings with IBM. Previously, when Interchange needed to work with IBM, it would have to sort its way through a crowd of contacts in sales, marketing and support. Now, the company’s staff can pick up the phone and quickly resolve problems and answer questions, Durst said.

IBM’s Hebner said the new vertical focus to IBM’s channel activities is helping the company identify, by territory, areas in which it needs to attract additional ISVs. The company is drawing up “solution blueprints” for problems it sees customers facing in various industries, and with those blueprints it can determine where functionality gaps exist, and seek new partners to fill them, while also encouraging existing partners to expand their offerings, Hebner said.

IBM’s new focus on vertical solutions reflects what Interchange has long seen in the market, Durst said.

“Customers don’t say, ‘We need to buy Lotus,’ they say, ‘We need to buy a sales solution,'” Durst said. “IBM has evolved. They used to be more product-oriented, but they realized people are not out buying products, they are buying solutions. I think right now, that’s their number-one strength as a partner. Together we can provide business solutions, not products, that meet (customers’) needs.”