© 2014 IBM Corporation

How IBM is fuelling Enterprise Transformation and Innovation

Laurent BoesDisruptive Technologies Strategist @laurentboes

© 2014 IBM Corporation‹#›

OPEN

HYBRID

PARTNERSHIPS

DATA

CLOUD

ENGAGEMENT

MOVE UP THE VALUE STACK

INDUSTRY EXPERTISE

SPEED,

AGILITY

ELIMINATE COMPLEXITY

ENGAGEWITH OURCLIENTS

STRATEGIC IMPERATIVES

DIFFERENTIATED VALUE FOR

OUR CLIENTS

FOCUS ON HIGHER VALUE

RUNNING OUR ENTERPRISE

The IBM and Weather Company AllianceKey themes of the IBM Strategy

#Newwaytowork

STRATEGIC IMPERATIVE

1. Make markets by transforming industries and professions with data.

WHAT WE SEE SHIFTING

Data is becoming the world’s new natural resource.

CONSIDER:

$187Bpotential market in 2015. Survey results suggest 61% of

enterprise tech projects are now funded by the business rather than the IT department.

61%

$14B

CRO

$17B

$16BCity

Manufacturing

Officer

$25B

$28B

$40B $61B$99B

$39BChief Customer

Officer

CFO

CHRO

CSCO

CPO

Chief MedicalOfficer

CMO

CSO

Market opportunity (SWG + GBS + GPS)

Scale the market Incubate

the market Emerging

priorityCity Legal Officer

IBM CONFIDENTIAL 2014 4

$24B

$18B

$31B

City Leaders

connected objectsand devices on the planet generating data by 2015.

1,000,000,000,000

increase in data-transmittingtransistors per human by 2017.

3x

DVDs worth of datais generated daily.

500M

petabytes of data is collectedevery hour by a major retailer.

2.5

gigabytes of new datagenerated every day.

2.5Bof the world’s data is unstructured. Audio. Video. RFID data. Blogs. Tweets. All represent new areas to mine for insights.

4/5thsThe growth rate of IT spending by groups outside of IT than in IT from 2014 to 2017.

2.5x

Making markets by transforming industries and professions with data.

Data is the new basis of competitive advantage.

INVESTMENT INVESTMENT

$1BEXPERTISE-BUILDING

INTELLECTUAL CAPITAL

$24B

$1B

$17B

$7B

of IBM Researchis focused on bigdata and analytics

5

1/3rd

Analytics everywhere

Speed of insight core differentiator

Cognitive capability is key

IBM CONFIDENTIAL 2014

EXPERTISE

analytics-based patents generated each year.

500

MARKET IMPACT

invested to date to buildIBM’s capabilities in Big Data & Analytics.

in Flash technology, providing industry-leading speed and efficiency to enable data tobe real-time ready for analytics.

in Big Data & Analytics acquisitions, including more than 34 acquired companies.

cumulative organic development since 2005.

to establish the IBM Watson Group, dedicating 2,000 professionals to the effort. Includes $100 million to enable an ecosystem ofentrepreneurs and partners.

IBM analytics consultants.

15,000

IBM mathematicians.

400

IBM business partners.

2,215

dedicated Watson professionals.

2,000engagements to date

40,000

Big Data & Analytics revenuein 2013. It is expected to reach $20B in 2015.

$16B

university partnerships.

1,000

Big Data University enrollments.135,000

active practitioners in AnalyticsZone.com.

40,000

OUR POINT OF VIEW: THEREFORE IBM IS:

Voice of Customer

Understand individuals

Product Research& Innovation

Identify unmet needs

Real Time OperationsSense demand shifts

Talent AcquisitionWork with the best

Behavior Driven ServiceEngagement in context

Insights from Twitter can shape every business decision

Twitter distinctively represents the public pulse of the planet

Integration of Twitter data

with IBM analytics

services on the cloud

New data intensive

capabilities for the

enterprise

Specialized enterpriseconsulting

Business decision making will never be the same.

And what it means to you?

The value of the IBM / Twitter partnership…

Segment of “interested in weight loss” focused on “smoothies” shows mostly young, single females

While creating campaigns, doing product research or looking for new target segments – IBM classifies data in a way that results in more informed decisions

Active reports let you dig into the data to pull insights

Dr. Tom Frieden actually influences conversations of many other users:•> 15000 accounts influenced•Some of the accounts are known to Client However, most of the influencees are new for Client:

Kathleen Sebelius (ID SEBELIUS)Former secretary of HHSCategory: Policy MakerVery influential:38511 followers, less active (284 tweets), generates lot of engagement (54860) and has very high authority

Influencee Twitter Handle

Strength of Influence

Influence Score

Sebelius 52.682674 93NIHDirector 52.682674 80ashishkjha 52.682674 60HHS_DrKoh 52.682674 38drjmob 52.682674 12Farzad_MD 95.786674 9charlesornstein 86.208 8Surgeon_General 81.41868 8HarvardHSPH 62.261337 8

Exa

mpl

e in

fluen

cees

/ in

fluen

cers

Actual Analysis – Influencer Networks

Actual Analysis – Influencer NetworksIBM and Facebook

Watson Analytics for Weather and

Industry Solutions

Cloud and Mobile App Developer

Tools

Business and Operational

Weather Expertise

#WeatherMeansBiz

The IBM and Weather Company Alliance

The IBM and Weather Company Alliance

© 2014 International Business Machines Corporation 13

Welcome to Watson

IBM Watson

Natural Language

Discover

Learn

Understand

Confidence

IBM Watson

IBM Watson is on the market today, not in research labs

IBM Watson Health ongoing partnerships

IBM Industry Analytics Solutions

IBM & Spark commitment

STRATEGIC IMPERATIVE

2. Remake enterprise IT for the era of cloud.

WHAT WE SEE SHIFTING

The emergence of cloud is transforming IT and business processes intodigital services.

CONSIDER:

1/4th 50% 85%

72%$250B 100

CloudNon-Cloud

CAGR growthfor Cloud by 2020

-2%7%

46%

Today 2020

Cloud percentageof total IT spend

6

25%

IBM CONFIDENTIAL 2014

of the world’s applications willbe available in the cloud by 2016.

potential market sizefor cloud by 2017.

of large enterprises will havehybrid cloud deployments by 2017.

of developers already reportthat cloud-based services or APIs are part of the applications they’re designing.

of new software is nowbeing built for the cloud.

countries have data-protection regulations in place.

Remaking enterprise IT for the era of cloud.

Cloud is the path to new business models.

INVESTMENT

EXPERTISE

PORTFOLIO

MARKET IMPACT

500+

7

$7B 1,500+

36,000

70%

5.5M

$4B+

Hybrid clouds are key

Cloud needs same rigor as on prem

Leverage clouds to reinvent your business

INTELLECTUAL CAPITAL

IBM CONFIDENTIAL 2014

16

DEVELOPERS

OUR POINT OF VIEW: THEREFORE IBM IS:

invested to date to build Cloud capabilities. $1.2B tobuild SoftLayer pods in 2014.

acquired companies,including SoftLayer.

CLIENTS

80%of FORTUNE 500 companiesuse IBM’s Cloud capabilities.

client transactions processed through IBM’s Public Cloud daily.

Growth of year-to-year revenue.

Revenue in 2013, with a $2B annual run rate for “as-a-service.”

8,000

20,000

100+

15

40

virtual machine configurations available to IBM’s clients (versus 27 fixed configurations by nearest competitor).

SoftLayer exposed services to provide a view of the client’s environment.

industry leading SaaS and IaaS offerings.

new cloud data centersplanned for 2014, bringing global total up to:

developers contributing toopen-standards projects as afounding member of OpenStack.

Cloud-based patents.

Cloud experts.

IBM Bluemix

IBM Bluemix: developers’ expectations have evolved

Failing Fast

Seconds to

Deploy Friction Free

Any Language

Continuous

Integration

Mobile Ready

Focus on Code

Choice of Tools

Useful APIs

IBM Bluemix: how does it work?

IBM Bluemix: the innovation platform

IBM Hybrid Cloud approach

IBM and SAP Cloud Partnership

IBM & Box new way to work partnership

IBM Watson Health Cloud

STRATEGIC IMPERATIVE

3. Enable “systems of engagement” for enterprises. And lead by example.

WHAT WE SEE SHIFTING

Social. Mobile. Data. Together they are empowering people with knowledge, enriching them through networks and spawning expectations for real value in return fortheir information, with enterprises they trust.

of Millennials say social anduser-generated content has an influence on what they buy.

57% of companies in 2014 expect to devote more than 25% of their IT spending to systems of engagement. (Almost double the investment one year ago.)

CONSIDER:

of smartphone users check anapp as soon as they wake up.

of U.S. adult smartphoneusers keep their phoneswith them 22 hours per day.

The response time users expectfrom a company once they have contacted them via social media.

of individuals are willingto trade their information for a personalized offering.

of U.S. adults say they would notreturn to a business that lost their personal, confidential information.

2x

57%

8IBM CONFIDENTIAL 2014

of upside potential in onlineretail sales if buyers trust more.

of Boomers agree.

as many people in 2013were willing to share their geolocation data in return for personalized offers compared to the previous year.

$1T

2/3rds

84% 5mins.

4/5ths 80%

84%

70%

THEREFORE IBM IS:

We are enabling “systems of engagement” for enterprises. And leading by example.

OUR POINT OF VIEW:

A systematic approach to engagement isnow required.

Speed and responsiveness

Personalize interactions

Earn the right through security

8

6,000

companies acquired in mobile.

companies acquired in security.

69%year-to-year revenue growth in Mobile.

year-to-year revenue growth in Social Business.

25.

10security operation centers globally.

billion security eventsmonitored daily in 130 countries.

2,800+.19%year-to-year revenue growth in Security.

4,300+

IBM AS AN EXAMPLE

Gartner positions IBM as a leader in its Magic Quadrant for Social Software in the Workplace.

IBM Social and Digital Analytics applies behavioral sciences and analytics, supported by IBM GBS.

Top banks globally use IBM Security Solutions—7 of the top 10 in the US, 9 of the top 10 in UK and 2 of the top 4 in Australia.

60% of Fortune 100 companies are using IBM’ssocial business solutions.

200,000

MARKET IMPACT

9

Sales Connect:100% of sellers transitioned.

Client Collaboration Hubs:30,000 IBMers collaborating.

Kenexa as a centerpiece acquisition in social.

IBM CONFIDENTIAL 2014

INVESTMENT EXPERTISE

45%

INTELLECTUAL CAPITAL

15

12PORTFOLIO

3,000

patents in social, mobileand security. security labs globally

social business experts,including 200 behavioral scientists

security professionals.

mobile development and delivery professionals—added more than 1,000 in 2013 alone.

social communities.

IBM Interactive Experience Studios

Design Thinking

Users first

Contextually aware

Aesthetically pleasing

Fun to use

Clear and in-context

Obvious

Everywhere

Apple and IBM

IBM Verse

Realtime

Analytics

Delivery

Mail Reimagined

IBM and SAP HR Partnership

No Engagement without Enterprise Security governance

QRadar

Trusteer

Identity and Access Management

InfoSphere Guardium

AppScan

Network andEndpoint Protection

IBM X-ForceMonitor and evaluate today’s threats

Detect, analyze, and prioritize threats

Reduce fraud and malware

Manage users and their access

Discover and harden valuable assets

Secure critical business applications

Protect infrastructure against attacks

The IBM Security Framework

Leaders will take a systematic and integrated approach to drive enterprise innovation by creating the right ecosystem

Systems of Insight

Enterprise Innovation

Systems of InsightHow are you harnessing Big Data for competitive advantage?

Systems of EngagementHow are you harnessing mobile and social to transform relationships with customers, employees and citizens?

7 © 2014 IBM Corporation

Systems of Record

Systems of Engagement

Systems of RecordHow are you transforming your existing IT systems for the requirements of the new era?

Systems of Record

Systems of Insight

Systems of Engagement

Pervasive Security Intelligence

Enabled by Cloud

EnterpriseInnovatio

n

Thank you! Questions?

@laurentboes