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The Six Five CXO at IBM Think: IBM Ecosystem Strategy

On this episode of The Six Five CXO, hosts Daniel Newman and Patrick Moorhead welcome  IBM’s Kate Woolley, General Manager, IBM Ecosystem, VMWare’s  Zia Yusuf, SVP Strategic Ecosystem and Industry Solutions, and Brian Mullaney, Chief Revenue Officer of CrushBank.

Their discussion covers:

  • An update on IBM’s Partner Plus program, along with key takeaways from the early days of the program
  • Insight on VMWare’s partnership with IBM and how the IBM Partner Program has brought value to the company and its clients
  • Details on the expansion to the IBM embeddable AI software portfolio, and how IBM is enabling the Ecosystem Partners using IBM AI technology
  • What’s next for AI and Crushbank, and how its partnership with IBM will evolve

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Disclaimer: The Six Five CXO is for information and entertainment purposes only. Over the course of this webcast, we may talk about companies that are publicly traded, and we may even reference that fact and their equity share price, but please do not take anything that we say as a recommendation about what you should do with your investment dollars. We are not investment advisors, and we ask that you do not treat us as such.

Transcript

Patrick Moorhead: Hi, this is Pat Moorehead and we are live at IBM Think 2023 in Orlando for a Six Five CXO. Dan, in-person events are back, lot of excitement. I mean, we’re going in between two hotels, a conference center, riding boats to dinner. I mean this is great.

Daniel Newman: Yeah, we are at a tech conference, Pat. But you know what, it’s an exciting one, because we are in the middle of a big year of AI, and this one will not let you down, because you could just feel the energy, you can feel the excitement. And you know, you also can feel is all the interesting collaboration that’s going on with so many companies working so closely together. Competing interests perhaps, but in the end, it’s all about driving value to the enterprise and to the user. And that’s a lot of what I’ve taken away from things so far.

Patrick Moorhead: Yeah, it does take a village. And by the way, we could sit here and talk the whole time, but the interesting part are our guests. Kate, welcome back.

Kate Woolley: Thank you guys.

Patrick Moorhead: Good to see you.

Kate Woolley: Great to see you too.

Patrick Moorhead: Brian with CrushBank and Zia with VMware. Great to see you.

Brian Mullaney: Thank you very much.

Patrick Moorhead: Veteran of the Six Five. Actually, first time? Second time in the Six Five with Zia?

Daniel Newman: Second time.

Brian Mullaney: Well yeah, I had the chance to sit down with Zia in beautiful Palo Alto, but we’re in beautiful Orlando.

Patrick Moorhead: Great to see all of you here. Yeah. So Kate, let’s start with you. So you had a recent announcement around Partner Plus. You actually briefed us. We’ve had you on the Six Five and we talked about it. Some time has passed, it’s gone into the marketplace. Give us a little bit of update on how that program is evolving, what you’re hearing so far from your partners. We’d love to know.

Kate Woolley: Hearing a lot of positive reactions from the partners. The partners are really liking the program. The things they like the most about the program, how simple it is, how easy to understand it is, how transparent and predictable it is for them as they think about how they engage with IBM. Yesterday we made some announcements around the program as well. So we’ve included technology lifecycle services is now included in the program. And we made an announcement yesterday about our Partner Plus awards that will start next year. So be fantastic to continue to evolve the program. A couple of stats we’re seeing, so we’ve had 60,000 course enrollments since we announced the skilling and badging back in October. So a lot of engagement in the program. The program’s all built on skills. And we’ve also had 2000 new partners join the IBM Partner Plus program since we announced in January. So a lot of excitement from our partners to be a part of the ecosystem.

Patrick Moorhead: Congratulations. And I think one of us said it on the show, we like the new IBM working with partners that we may not have expected for IBM to work with in the past. But hang on, let me do a quick fact check. Zia, I’m just of course kidding, how is IBM Partner Plus working with you and your clients? Can you talk about new logos, new brands. How’s it working out for you?

Zia Yusuf: Sure. First of all, I’m excited to be here and the announcements, especially around generative AI and Watsonx. Look, we have a multi-decade partnership with IBM, that has gone through so many different technology cycles, and we’re super excited about this next generation of technology cycles. We collaborate on IBM Cloud, we started interacting on IBM consulting, we co-create and co engineer with IBM on multiple places. So that partnership has been evolving.

I think as you look at work that Kate and her team are doing and Partner Plus, above and beyond some of the kind of normal things you would expect. I think it’s super important and beneficial that we are getting the inside knowledge and expertise that IBM has built up over years, that they’re willing to share that. At the end of the day, the ecosystem is not just about the companies, it’s a human ecosystem. And making sure that we can train and enable both the VMware colleagues, but also our joint ecosystem, our GSI partners, we were talking about that today. So it’s a great step forward, and at the end of the day, that ecosystem has to come together. You have to architect that ecosystem, and we’re super proud of what we’re doing with it.

Patrick Moorhead: So we’d love to talk about wins. Okay. Can you share any wins here for the show?

Zia Yusuf: Look, we’ve been focused on financial services together and regulated industries. As you look at American Airlines, as you look at Bank Paribas, these are all joint customers that have gone through, again, a transformation journey. VMware has a very large install base, as does IBM. So there’s a lot of opportunity for us to connect at the customer side and we continue to improve how we do that.

Patrick Moorhead: Excellent.

Daniel Newman: Yeah, we do like to talk about the customer wins, don’t we?

Patrick Moorhead: It’s just fun. I mean, especially when it comes to partners and channels and wins.

Daniel Newman: Well, I think that also really comes back to we have a lot of things announced in tech, and of course there’s a kind of a rapid fire. You and I spend, now that we’re back to events full-time, 47, 48 weeks a year at events, sometimes 2, 3, 4 a week. And you hear, and you hear, and you hear, one of the things that we’re always so interested in is the follow through, meaning you made that announcement, yeah, you’ve got this partnership. Was it a posturing or positioning thing? Was it a headline grabbing, news jacking moment, or are these partnerships really materializing? And I think in the era of AI, the partnerships are going to be really important. And Kate, I’d like to kind of come back to you here because last fall the company announced it’s embedded AI. We talked about that, which of course was going to open the door to lots of partner use opportunities. With all the announcements here, I’d love to get your take through the partner leadership lens of why this is such an important inflection for for IBM and its AI strategy.

Kate Woolley: I think it’s really exciting what we can do with our partners in the AI space. I mean, I think all of our partners and our partners clients are really overwhelmed as they look at the AI space and how do they get the most value out of it. So if we look at the announcements here around watsonx and what that delivers as kind of a workbench for our partners and their clients to build on, to embed AI, to think about governing their AI, I think it’s very exciting. And I think the IBM and SAP announcement is a perfect example of this, as we think about SAP leveraging IBM’s AI technology to make a better user experience, faster decision making. And by embedding a IBM’s AI, we can allow SAP to do what they do best in terms of building a world class, leading ERP platform. So it’s really a perfect match in terms of bringing together that AI technology with our partners.

Daniel Newman: Yeah, it’s really interesting. I know in the midst of Covid pandemic, we all talked a lot about how digital transformation was accelerated at some breakneck. We did 10 years, pulled forward in two minutes, or whatever different quote we came up with. But it’s interesting is I would actually… I’m starting to feel like I could make the argument that this inflection of AI will accelerate even faster than what we were done… What would happen when we were forcing, and there’s a forcing function of AI. But I do want to ask you, Kate, just as kind of a follow up is, you have to be an enabler. And so for a company like SAP that has tons and tons of resources, but you have partners of all sizes and all shapes, how do you see IBM becoming a facilitator and an enabler to help companies of all sizes really deliver on the promise of AI as a whole?

Kate Woolley: I think there’s a lot of different ways in terms of how we think about engaging with the different partners. I mean, if I go back to just some of the basics around how do we skill and enable our partners, all of our skilling, training, enablement materials are all available to our partners free of charge now as part of Partner Plus. So anything we are doing with our IBMers around AI, and anything that rolls out with the new Watsonx platform, how we’re training, how we’re skilling, that will all be available to all of our partners to build those skills so that they can go and reach their clients and we can work with them to do that. And then you talked about the embeddable AI, how can we continue to work with our ISV partners and invest in the resources to help them leverage the Watsonx platform? So a lot of different ways in terms of how we think about engaging the ecosystem partners and investing to give them the support they need to go and do more in this space.

Patrick Moorhead: So Kate, really glad to see the success in IBM’s embedded AI. I’m not actually surprised you’re having success with it, because quite frankly there is this distinguishing difference between B2C AI and B2B AI, and even inside of B2B AI, there’s this factor of trust. And with all great technologies you can get into trouble too, particularly with generative AI. Brian, you’re using IBM’s embedded AI with your clients. I wonder if you could share for the audience what you’re doing with them and how it’s benefiting them.

Brian Mullaney: So our entire business is built on IBM’s embeddable AI. We go years deep. We started very early stage 2014 when the partner program first opened. I think we were literally the seventh or eighth Watson partner. It’s iterated three or four times since then. Our whole business is really built around leveraging Watson to bring forth assets, information, and solutions from existing data sets from our client base. So to ask, the real answer is it’s the entirety of our solution and our relationship is really tightened up not only being the platform, but now a real partner over the last nine to 12 months, where we work very closely with opportunities and solutions that we can bring to market.

Patrick Moorhead: So you’re actually using in production what was announced just a few months ago and then kind of enhanced here at the show?

Brian Mullaney: So sort of backed into it. I mean, yes is the answer. As I said, we’ve truly been doing it for years, couple generations on our side, along with a couple generations of Watson. When Embeddable AI came out as a partnership or as a product, if you will, we started working closely with our IBM counterparts to turn that into a real revenue generator and a value generator. And what we’ve heard from the market, I was just down earlier today with a client of IBM’s and a potential client of ours, and we can turn the concepts of these tools into revenue and value in a matter of months as opposed to quarters and years, which is huge value to IBM sellers and it’s huge value to the IBM community, and to the end user to be able to turn what exists into B2B value right now.

Patrick Moorhead: Gosh, it’s exciting. I mean, you talk about something happening in the future and the future is important, but you’re adding value today. But I have to ask, because I’m an industry analyst, what about the future between CrushBank and IBM?

Brian Mullaney: So full speed ahead. We see what we’ve done around semantic AI search has really set a table that we believe is foundational for the way that our client base leverages AI. And it went from, “Oh, an interesting conversation,” 12 months ago to people being assigned this topic and given a job to run this internally, which is good and bad, but in general we see it as a positive because you need that foundational semantic AI search, from our view, to start any sort of solution. From here we love the brand of trustworthy AI going forward. There’s all sorts of generative AI that we’re building into it. So you’ll see a lot of further builds around content creation and optimization from CrushBank over the course of the year, which really builds on our promise, which is to take what you have and optimize it right now.

Patrick Moorhead: It’s interesting, we heard at the show, AI plus deleting with AI. I mean that’s a perfect example, at least if I’m understanding you correctly.

Brian Mullaney: No, for sure. The challenge in our marketplace, anyone who’s doing IT support, which is generally our client base, whether you’re an OEM or an IT services company, is human capital. Even in spite of the last 12 months, everyone tells you how bad it’s getting, and you’re watching another quarter million jobs get dumped onto the top of the heap every month. So it’s not getting cheaper, it’s not getting better. You’ve got to get more intelligent around the way that you use the human capital you have. So we’re all about taking what you have and driving more value out of it.

Daniel Newman: Yeah. We’re been very focused on the deflationary aspects of tech in our upcoming summit. That’s the navigating rough waters. 2023 has been a complicated year and tech is… I always say we’re going to tech our way out and you’re kind of talking about this is teching our way out of tougher markets and then into the next phase of growth. Kate, I’m going to come back to you in a second, but Zia, you’ve been a little quiet. And we got to hear… Well, it’s because we haven’t asked him anything. But Brian-

Patrick Moorhead: I think I asked him a question.

Daniel Newman: No, not lately though. Brian got to talk about the future and I want to wrap up by hearing from both Kate and Zia about it, but I want to get Zia’s take. What are you excited about as it pertains to the partnership, to the relationship, as we head in through 2023? What’s your outlook?

Zia Yusuf: I think, look, the foundation is both companies have a superior focus on customer value and customer outcomes. I mean, let’s just start from there. And it may seem like a very motherhood and apple pie statement, but it really does help to anchor in that. From a technology perspective, you heard IBM talk about obviously AI piece, but hybrid cloud is a very important foundation for them. And as you know and you’re familiar with VMware, that’s very much has been our perspective for the last few years, and our entire product strategy has been based on that. So yes, somebody will have multiple public clouds, they’ll have a private cloud, they’ll have some on-premise piece of it.

And yesterday there was an interesting comment, and I kind of thought about it, and he’s absolutely right, where people have kind of backed into a hybrid cloud strategy because just somebody kind of picked up some workloads here, sent the stuff there. And I think that needs to be converted into a very deliberate strategy on behalf of our joint customers. Where do you put what? Now you add all the AIPs, you add all the data lake in stuff that needs to happen. There’s a social responsibility piece. It truly is a little bit of a perfect storm of technologies. You had internet, you had mobile, you had cloud. This definitely feels like another one of those moments. And we I think, from a VMware perspective, standalone feel pretty good about the products that we’ve brought to market, whether it’s on app modernization, whether it’s on cloud management, whether it’s our interaction with AWS and Azure and GCP, what we’re doing there. So that’s what the next few years are going to be about, and delighted with the multiple layers of partnership and engagement with IBM.

Daniel Newman: Yeah, and I think that’s really important and I appreciate both of your sentiment. Kate, this is your partner program, obviously on behalf of IBM you represent. Talk a little bit about the energy of the event, as you’ve had a lot of these conversations here and as you’re heading through the rest of the year. What’s sort of the things you’re excited about as it pertains to this program?

Kate Woolley: It’s really exciting to be here. The energy that we had yesterday with the Partner Plus Day. And you kind of said, “Is this real?” And this is very, very real. This is coming to life now and is very real. And as I think about where we go with the ecosystem, there continues to be so much more we can do. Even Zia and I were together earlier today and VMware has very strong relationships with system integrators. IBM has strong relationships with system integrators. Is there more we can be doing in three-way partnerships there? And I’ve had several of those conversations today. Just goes to show everyone’s continuing to think about how we do more and more with our partners, which is fantastic. We had a video yesterday that we showed that said, “Alone we can do a lot, but together, what can’t we do?” And I think that reflects how we’re thinking about the ecosystem. There is so much more we can do and we are pouring the focus and investment behind that.

Patrick Moorhead: That was a great place to wrap. Kate, Brian, Zia, I just want to thank you for coming on to the Six Five here.

Kate Woolley: Thank you Pat.

Patrick Moorhead: And hopefully it won’t be the last time.

Zia Yusuf: Pleasure. Thank you very much.

Brian Mullaney: Thank you.

Daniel Newman: That was great.

Patrick Moorhead: This is Pat Morehead, signing off with Daniel Newman here at IBM Think 2023, for the Six Five CXO. We love these shows. We appreciate you. Check out all of our coverage from IBM Think, whether it’s on video, or for our respective analyst firms. Thanks for tuning in. Take care.

 

Author Information

Daniel is the CEO of The Futurum Group. Living his life at the intersection of people and technology, Daniel works with the world’s largest technology brands exploring Digital Transformation and how it is influencing the enterprise.

From the leading edge of AI to global technology policy, Daniel makes the connections between business, people and tech that are required for companies to benefit most from their technology investments. Daniel is a top 5 globally ranked industry analyst and his ideas are regularly cited or shared in television appearances by CNBC, Bloomberg, Wall Street Journal and hundreds of other sites around the world.

A 7x Best-Selling Author including his most recent book “Human/Machine.” Daniel is also a Forbes and MarketWatch (Dow Jones) contributor.

An MBA and Former Graduate Adjunct Faculty, Daniel is an Austin Texas transplant after 40 years in Chicago. His speaking takes him around the world each year as he shares his vision of the role technology will play in our future.

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