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Of IBM's systems management initiative

Wrong premise, says Gustin Partners' Cormac O'Reilly

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Comment IBM is in full swing promoting its highly integrated and extensive It management tools and technologies which it's ready to roll-out into an enthusiastic, waiting business community. Or so it thinks. Why does this seem like another chapter in Kafka's The Trial to me?

Perhaps because I remember the first "trial", a visit to Hursley Park, IBM's research and Training center in England a good number of years ago. IBM then owned over 80 per cent of the IT world. I was a young systems manager who, with the encouragement of my IBM salesman,had my business management team colleagues attend a future technology briefing.

At issue then was emerging database technology and how it would change the information systems landscape by efficiently collecting and rationalizing data such that one instance per organization existed. The killer benefit then was the control provided by data integration. And the most obvious payback was, believe it or not, reduced disk storage spending and less data entry.

Fast forward all the years (and "trials") in between, to an age where database technology has proved a boon mainly to the IT community, where disk costs are heading towards zero and data preparation as a free standing activity is thankfully a distant memory. And business teams are heartily sick of IT panaceas.

Marketing types reminds us that for years IBM has been building a portfolio of advanced IT management tools - Tivoli (the physical computing environment), Rational (for software development) and now a slew of new acquisitions that are beeing integrated into what IBM hopes will be a "killer" revenue generator.

This gives me a bad existential feeling. I question the appropriateness of the fundamental control model on which IBM's solutions are based and believe it's plain wrong from three perspectives: it does not fit with contemporary business models; it does not take into account contemporary technology deployment; and, dare I say it, fles in the face of ageless commonsense.

Way back when IBM started this initiative, businesses were models of monolithic construction, essentially developed to control of every facet of business operation. Today's business construction is highly fragmented, often more like a patchwork quilt of highly focused, independent (internal or external) organizations efficiently delivering their share of customer value.

A master organization (like GM or WalMart) integrates that value component into the final customer offering (a product or service) and uses advanced in quality management, and of course electronic systems, to accomplish to deliver and profit from that value. The the patchwork of companies use IT products and services that makes sense for them. The point being, that the days of single organizations spanning "value-chain-wide" operations are now hardly a blip in the rearview mirror. So where's the business business beef in IBMs portfolio, I wonder?

If the conceptual case for the business is misplaced, so also is the case based on technology deployment. We already know that large IT shop operations are increasingly farmed out to specialist firms which have already placed their bets on management systems and tools.

There is no value proposition in having these investments, skills and disciplines in-house anymore, and in any case control customization of computer processing and networking offers very little intrinsic value. Base line software is standard and systems are now bought-in, or increasingly bundled into functional solutions (like SalesForce.com).

Today, PC providers (like Dell) master employee-focused configurations based on ever simpler software, which in any case are in the hands of more literate user increasingly unwilling to be language tutors for the massed Indian help desks. Add the growing public services that woven into corporate life (search engine, eMail, IM etc.) and you really have to wonder what the value proposition is.

Finally, commonsense - usually the last thing traditional computer industry majors want to deal with. The old adage was that what you if don't measure, you don't control - and what you don't control, you don't manage. It's still valid but smart businesses have adapted this to commonsense.

Today, management starts from the value end, not the construct end. Management mechanisms are based around the value and quality that a product or service provides, and the customer experience it engendes. Every fragmented organization piece, whether a subcontractor in China or assembly plant in Kansas, taht is empowered around the customer, delivers value. Sure there are quality checks and balances, but nobody specifies the how to of IT, they rather focus on what to, and the associated value consequences.

At the end of my years-ago management briefing visit to IBM, while having a coffee on the lawn of Hursley House, I asked my CEO what he though of time spent at at the briefing " It's a very nice house," he said casting his eye over the William and Mary architecture of Hursley House. We went on to decentralize IT over the following three years using IBM computers that never featured in the briefing. ®

Cormac O'Reilly acts as a senior advisor for Gustin Partners, a Boston-based boutique management development firm, while not spending his ill-gotten gains living in Texas and the UK.

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