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IBM ecosystem strategy embarks for hybrid cloud, AI future

Big Blue said it has laid the groundwork to rapidly grow hybrid cloud and AI business through its partner ecosystem, which includes VARs, ISVs and systems integrators.

Less than two years after its Red Hat acquisition, IBM is ready to shift its ecosystem strategy into high gear.

That's according to Bob Lord, senior vice president of worldwide ecosystems and blockchain at IBM. The redesign of IBM's partner ecosystem strategy began with the company's $34 billion purchase of Red Hat in July 2019. The renewed strategy centered around Red Hat OpenShift, an open source container application platform that Lord described as "a fundamental piece of platform software that enables [IBM] to activate the ecosystem at scale" and pursue hybrid cloud market opportunities. After reengineering IBM's go-to-market approach, along with its supporting programs and resources, partners can now accelerate adoption of OpenShift-based hybrid cloud architecture and AI platforms, he said.

"We have seen really good progress with the global systems integrators, with the ISVs of the world, and even with our [value-added distributors] and VARs that have really accelerated their learning, their education and using the IBM [portfolio] to go after new deals and markets," Lord said.

He noted that IBM has also installed an ecosystem leader in each of the markets it aims to capture. Those leaders are charged with implementing strategic plans down into local markets. Additionally, to increase its commitment to its hybrid cloud and AI future even further, IBM in October 2020 disclosed plans to spin out its Managed Infrastructures unit.

IBM ecosystem partner types

The IBM partner ecosystem can be broken down into four broad segments, Lord said:

  • Traditional distributor, VAR and reseller partners;
  • ISVs, such as Workday and Adobe;
  • System integrators such as HCL Technologies, Infosys, Wipro and Accenture; and
  • Elite partners, such as Salesforce and ServiceNow.

In terms of traditional IBM partners, Lord stressed that IBM has no intention of pulling back on the reselling or distribution programs that have been in place. The company, however, will provide additional incentives and resources to those traditional partners to drive adoption of IBM software with their clients.

He cited distributor Arrow Electronics, which is in the process of building a Red Hat OpenShift practice for its network of channel partners. "We are providing [Arrow] with extra resources and extra funding" to enable its OpenShift practice, Lord said. "The core Arrow business itself is still solid and still runs, so [Red Hat OpenShift] is really on top of the program, not replacing anything."

Going vertical

As IBM seeks to verticalize its hybrid cloud offerings, as it has with IBM Cloud for Financial Services and IBM Cloud for Telecommunications, Lord noted partners will play a key role in that strategy. He said IBM views its ecosystem partners as part of the overall value proposition for customers in vertical markets.

"It is important to build the technology, but it is just as important to build the ecosystem around the technology, because, to a client, that is really the power. [You] can port into one cloud, and by the way, [you] get access to this ecosystem," he said.

As a result, partners that specialize in a vertical market will "have a leg up over other partners," he added. "I do think for partners as they come on board, actually understanding what they are known for is going to be really important, because we are providing a horizontal platform. If you are well known in the insurance industry and you can take our platform into the insurance industry, that is a home run for you."

IBM and Red Hat in September 2020 launched the Red Hat Marketplace to help further its vertical market efforts. The Red Hat Marketplace distributes ISV and other partners' products that are built on Red Hat OpenShift.

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