Hardware may be out of fashion, but it is still proving profitable for IBM, after the vendor announced it has driven $76 million in new revenue and doubled the number of new customers choosing its System I platform in the past 10 months.
The reason for the upturn, according to David Kinsey, VIP sales manager at IBM, is the vendor’s Vertical Industry Program (VIP), launched back in January for partners. "We wanted to launch a program that would resonate with customers and partners, so we invested a lot in headcount and resources to find where our products had the best fit within specific industries," he said. "After we identify the subindustries, then we look at what the partner community looks like in that area."
The program, Kinsey said, also pairs up System I resellers with ISVs who have vertically targeted software for small and midsize businesses. "Usually the ISV and VAR already have a relationship to hit the subindustries, but when they don’t we can look into pairing them up," he said. "People think there is a limited-sized pie out there, but when it comes to SMBs there are thousands of subindustries to target."
Kinsey said IBM had initially invested $6 million in the program and plans on doubling that next year as well as increasing its spread from 12 countries to 20 countries.
"By taking this vertical approach, it means we can replicate our solutions around the globe—take one solution in one industry in one region and then replicate that throughout the world."
VIP runs across IBM’s Systems and Technology Group and System I platform. Kinsey said other parts of IBM have their own vertically focused programs.
One of the most challenging aspects of VIP was holding back, he said. "We have to restrict ourselves from going everywhere and doing everything. SMB is the fastest-growing area of technology sales, but part of our formula must be to stay focused."