Dr. Danny
Sabbah
General Manager,
IBM Rational Software
No content below this line - No content below this line - No content below this line - No content below this line - No content below this line

Today’s Discussion
• Rational Strategy Review
• Our Approach to Real Results
• Time to Get Real
No content below this line - No content below this line - No content below this line - No content below this line - No content below this line

The evolution of Rational strategy
2006 2007 2008
Strategic Strategy Strategy
Imperative Announced In Action
Accelerating Deliver value efficiently Helping guide you
software and effectively in from the cathedral
development evolution distributed organizations to the bazaar
Empowerment Enabling governance Ship early
Modularity Adopting flexible Ship often
Communities architectures Listen to your customers
Leveraging communities
No content below this line - No content below this line - No content below this line - No content below this line - No content below this line

Rational strategy in action over the past year
CONTINUED DELIVERING on the promise and vision of a flexible
Jazz architecture
• Shipping early, shipping often with a transparent product development on Jazz.net
• Delivering 8 Jazz-built products and 18 Jazz-enabled products
CONTINUED EXPANDING Rational communities to listen to our
customers and partners
• Launched Open Services for Lifecycle Collaboration initiative
CONTINUED INVESTING to evolve current portfolio
• New releases of ClearCase and ClearQuest and 73 other C/ALM products in 2008
EXTENDED REACH into systems engineering by integrating Telelogic
No content below this line - No content below this line - No content below this line - No content below this line - No content below this line

Rational strategy in a broader context:
The world needs to get a whole lot smarter
INSTRUMENTED INTERCONNECTED INTELLIGENT
We now have the ability People, systems & objects We can respond to changes
to measure, sense can communicate quickly & accurately, & get
& see the exact & interact with each other better results by predicting
condition of everything. in entirely new ways. & optimizing for future events.
No content below this line - No content below this line - No content below this line - No content below this line - No content below this line

A smarter planet will require a significant
investment in software and systems
Imagine the amount of software necessary to:
• Leverage a wealth of information
to make more intelligent choices
• Take action on energy, the environment
and sustainability to deliver a greener world
• Manage an interconnected infrastructure
with billions of devices
Success in building a smarter planet is highly
dependent on our ability to manage effective
software and systems delivery
No content below this line - No content below this line - No content below this line - No content below this line - No content below this line

Challenges to effective software delivery remain
and expand
Individual Team Organizational Business
Challenges Challenges Challenges Challenges
Lack of standards Geographically Greater need More granular
impacts ability dispersed teams for market service functionality
to collaborate, experimentation and composite
Effective cross-
automate and report applications
organizational Blind adherence
Frequent asset visibility and to process insensitive Growing number
updates and synchronization to potential business of assets including
complex trade-offs custom, outsourced
dependencies and packaged
Need for agility@scale
No content below this line - No content below this line - No content below this line - No content below this line - No content below this line

Economic conditions add significant pressure
to the reality of software and systems delivery
Transformation and
A new approach to Companies successfully
innovation will lead recovery.
IT delivery models and addressing the challenges
When we come out the other
sourcing options is required [of delivering product
side of this crisis, companies
that allows IT organizations innovation from software]
will look different – technology
to be more responsive to are driving higher
will have been a catalyst
the needs of the business. profitability.
in those changes.
Barbara Gomolski, Gartner Michelle Boucher, Aberdeen Group George Colony, Forrester Research,
October, 2008 March, 2009 October, 2008
No content below this line - No content below this line - No content below this line - No content below this line - No content below this line

Rational strategy can bring focus in
uncertain times
• Provides measured, short-term Return on Investment
• Enables longer-term management of Return on Assets
• Delivers a platform and processes to make those returns
come to life
• Encourages and informs, rather than dictates
• Supports incremental improvement, leading to faster
decision making
No content below this line - No content below this line - No content below this line - No content below this line - No content below this line

A maturing approach to software and systems
delivery based on measurement
Business
Value
Software
investment
Efficiency management
Predictable aligned with
governance business and
and asset operational
Global utilization priorities
effectiveness
Control Productivity and collaboration
through
automation
Individual Team Organization Business
No content below this line - No content below this line - No content below this line - No content below this line - No content below this line

Realized by continuous improvement on
business objectives
Improve business flexibility
Accelerate progress and lower costs / risk
Improve stakeholder
Reduce scrap / rework
satisfaction and output
Business Reduce cost of change
Value Improve team productivity
Reduce custom training
and tooling variants Software
investment
Efficiency Reduce human error management
Predictable aligned with
Reduce manual tasks governance business and
Improve release quality and asset operational
Global utilization priorities
effectiveness
Control Productivity and collaboration
through
automation
Individual Team Organization Business
No content below this line - No content below this line - No content below this line - No content below this line - No content below this line

Invest to manage risks and optimize measured
outcomes
Improve Improve Improve Increase Flexibility
Automation Collaboration Process & Investment Value
Cost to Implement: Cost to Implement: Cost to Implement: Cost to Implement:
Business <5% 5%-10% 10%-35% 25%-50%
Value Very predictable Predictable Some culture change Much culture change
ECONOMIC IMPACTS
Productivity: Productivity: Productivity: Productivity:
5-25% 15-35% 25-100% 2x-10x
Timeframe = Days Timeframe = Weeks Timeframe = Months Timeframe = Years
Efficiency
Control
Individual Team Organization Business
Note: Implementation costs are per person per year
No content below this line - No content below this line - No content below this line - No content below this line - No content below this line

Pragmatic steps we took to mature our own
software delivery
1 Established business and operational objectives
2 Prioritized practices and defined implementation roadmap
3 Accelerated practice adoption with Rational products
and programs – “Tools, Not Rules”
4 Reported, analyzed, and regularly acted on our results
No content below this line - No content below this line - No content below this line - No content below this line - No content below this line

Established business and operational
objectives
Improve market share
Business
Achieve profit margin
Objectives
Reduce time-to-value
Heighten responsiveness and increase linkage to customers
Operational Innovate to differentiate and capture new value
Objectives Increase quality
Shorten project development cycle times
Improve schedule predictability
No content below this line - No content below this line - No content below this line - No content below this line - No content below this line

Prioritized practices and defined
implementation roadmap
Change and Release Management Initial Rational
Change Management
Team Change Management Focus Area
Formal Change Management
Requirements Management Quality Management
Shared Vision
Shared Vision Concurrent Testing
Concurrent Testing
Use-Case-Driven Development
Use-Case-Driven Development Test Management
Test Management
Requirements Management
Business Process Sketching
Agile Core Independent Testing
Performance Testing
Iterative Development
Iterative Development
Application Vulnerability Assessment
Two-Level Project Planning
Two-Level Project Planning
Whole Team
Whole Team
Governance and Compliance Architecture Management
Continuous Integration
Continuous Integration
Risk-Value Lifecycle Evolutionary Architecture
Evolutionary Architecture
Test-DrivenDevelopment
Test-Driven Development
Practice Authoring and Tailoring Evolutionary Design
Performance Measurement
Performance Measurement Component Based Software Architecture
Design Driven Implementation
No content below this line - No content below this line - No content below this line - No content below this line - No content below this line

Accelerated practice adoption with Rational products
Leveraged Agile Core practices to improve cycle times and predictability
Required adoption of agility@scale
Rational Results
• 2,000+ developers, testers, managers 100% Release Cycle Times 18
(in months) 16
• Varying team sizes 90%
14
80%
• Geographically distributed locales 12
70% 10
• Diverse development contexts 8
60% On-time Delivery
– from mature products to Web 2.0 apps 50%
6
4
Embraced Rational Team Concert 40%
2
30% 0
• In past year, RTC:
2007 2008 2009*
*Projected
– Projects grew by 291%
– Number of users grew by 321%
No content below this line - No content below this line - No content below this line - No content below this line - No content below this line

Accelerated practice adoption with Rational programs
Leveraged Requirements and Change & Release Management practices
Rational Results
Increased customer involvement,
building on “Whole Team” agile practice
90%
• Design Partner Program growth of 352% since 2006 Beta reported defects
75% fixed in GA releases
• Transparent, iterative development on Jazz.net 60%
RFEs included
in GA releases
– 5 products available today
45%
– Over 17,000 participants in Jazz forums
30%
• VoiCE sessions expanded to India and China 15%
• Lab Advocacy program has grown 567% since 2005 0%
2007 2008
• Beta programs doubled in 2008 to 35
Customer satisfaction up 4 years in a row
– 12x growth in open beta downloads
No content below this line - No content below this line - No content below this line - No content below this line - No content below this line

Reported, analyzed, and regularly acted on our results
Aggregated data from multiple sources to provide new insight
Executive and Operational Dashboards
Jazz Integration Architecture: Using REST Open Services / ODBC / XML
Rational Rational Rational Rational Quality Rational Rational Rational Project Headcount Sales & Customer Manual
ClearQuest Requirements Team Concert Manager Test Manager RequisitePro ClearCase Data & Financials Pipeline Support Data
Composer
RATIONAL THIRD-PARTY
Data Sources: Quantitative and Qualitative
No content below this line - No content below this line - No content below this line - No content below this line - No content below this line

Obtain a single view of project health across Rational
Quickly identify delivery issues that need immediate attention
No content below this line - No content below this line - No content below this line - No content below this line - No content below this line

Align business and operational measures
Drill down into real-time data from disparate source repositories
No content below this line - No content below this line - No content below this line - No content below this line - No content below this line

Pragmatic steps we took to mature our own
software delivery
1 Established business and operational objectives
2 Prioritized practices and defined implementation roadmap
3 Accelerated practice adoption with Rational products
and programs – “Tools, Not Rules”
4 Reported, analyzed, and regularly acted on our results
Started next incremental improvement
No content below this line - No content below this line - No content below this line - No content below this line - No content below this line

Rational’s next incremental improvement
Focus on Quality and Requirements Management practices
• Extend transparent development on Jazz.net
– Further improve products and enhance the way we engage with you
• Further engage community in the design of products
– Leverage Rational Requirements Composer capabilities such as
storyboards and domains of expertise
• Build on bootstrapping of Rational Quality Manager
– Incorporated key feedback from SVT organization to drive version
1.0.1 and 2.0 capabilities
– Expand use of RQM 2.0 to all Rational test teams
– Publish and share RQM tests
No content below this line - No content below this line - No content below this line - No content below this line - No content below this line

Rational experience demonstrates incremental
improvement in software delivery
• Experience the
same results
• We can help
– We offer an
incremental Collaborate Automate Report
improvement Achieve common
goals by optimizing
Increase control
and efficiency by
Continuously improve
by measuring progress
how people work integrating workflows in real time
framework (MCIF)
– We deliver a real-
time collaborative
platform (Jazz)
No content below this line - No content below this line - No content below this line - No content below this line - No content below this line

Time to Get Real – Starting Today
GET REAL Align teams to business and
TEAMS operational objectives
GET REAL Gain insights to incrementally improve
INSIGHTS software and systems delivery
GET REAL Measure, monitor and steer
RESULTS to desired results
No content below this line - No content below this line - No content below this line - No content below this line - No content below this line

No content below this line - No content below this line - No content below this line - No content below this line - No content below this line