How IBM innovates dec 2013 - the front end of innovation in IBM

3. Innovation@IBM IBM’s definition of innovation § Intersection of invention and insight § Creates value § Holistic view – Business model – Products & services – Operations ! “Innovation is a societal -- not a technological -- phenomenon, Sam Palmisano, CEO, IBM Corporation © 2013 IBM Corporation

7. IBM’s Ongoing Transformation Journey Remixed our portfolio toward services, software, and integrated solutions… 2011 another record year… § Exited commoditized businesses: –PCs –Hard disk drives –Printing Systems –Network § Created a partner world of more than 100K partners: ISVs, VARs, resellers, developers, CSIs § Strengthened position in: –Business Consulting –Service-Oriented Architecture –Analytics & cloud computing –Virtualization –Open, modular systems § § § § 8th consecutive year of double-digit EPS growth Revenue of $99.9B – up 4% Record net income of $14.8B – up 10% Growth markets accounted for 21% of IBM’s total geographic revenue § More than 6.300 US-patents § Highlights since 2000 … – Added $10B in growth market revenue – Tripled SW profits ! § Acquired 127 companies in last 12 years –to complement and scale our portfolio of products and offerings – EPS nearly tripled to almost 15$ in 2011 – $109B in Free Cash Flow – Returned $107B to shareholders 4 IBM Do not Distribute ©2012 IBM Corporation © 2013 IBM Corporation

8. Enabling culture change Innovation@IBM We Embrace Collaborative & Open Innovation Why? What we’ve done § Become our clients’ “innovation partner” § Established an innovation agenda that spans multiple dimensions: – Address client priorities – Build deeper client relationships ! Respond to changing nature of innovation ! § § Organizations need each other to be successful – Pace of innovation outstrips an organization’s ability to “go it alone” ! ! § Changing workforce dynamics – Globalization – “Millennials” Venture  Capitalists ISVs Investors Clients Product Services Business process Business model Management and culture Policy and society § Enabled global collaboration – Culture of collaboration – Innovation ecosystem IT Analysts Regulatory Bodies – – – – – – Business  Partners Innovation Ecosystem Employees Standards  Bodies Policymakers Competitors Alumni Universities § Technical § Business Community Leaders “We opened up our labs, said to the world, ‘Here are our crown jewels, have at them’. The Jam -and programs like it – are greatly accelerating our ability to innovate in meaningful ways for business and society.” - Sam Palmisano, IBM CEO © 2013 IBM Corporation

10. Innovation@IBM IBM has a workforce of over 500,000   of which almost 50% are mobile Major Employee Sites Customer Fulfilment Manufacturing Employee Service Centers IBM Research Centers IBM location Mobile employees • 190 countries • 2,000 locations • More than 100 acquisitions since 2003 • 50% employees have < 5 years experience LC © 2013 IBM Corporation

12. Innovation@IBM Innovation Enablers § Permission and alignment  § Open & transparent business strategy ! § Collaboration tools § Communities of adopters ! § Employee awareness & education ! § Social networks 8 8 © 2013 IBM Corporation

15. Mission Innovate Demonstrate to accelerate CIO initiatives what “the future of work” can be Develop alternate application management paradigms !15 We discover, create and incubate emerging technology solutions and nurture innovation, to accelerate IBM’s transformation Transform Innovation Programs to support the Smarter Enterprise © 2013 IBM Corporation

16. Innovation@IBM Our philosophy of innovation is: Fail many, but fail cheap   - A new paradigme in innovation enabled by Web 2.0: Yesterday – as was Ideas source: Internal idea idea idea 1 § Ideation and Product Inception from the expanding source for innovation ! § Use Collaborative tools to solicit interactive feedback. Today – As is Ideas source: Internal, partners and customers idea ideaidea ideaidea idea idea idea idea idea idea idea idea 18 months to 2 years § Limited community to foster new innovation Service § Little user interaction and market feedback Service § Service silos § Limited reuse § “Build it and they will come” approach 3 Service Service 2 § Larger variety of compelling offerings to offer customers Weeks to months idea § Use of exposed common capabilities to enable rapid service assembly Breadth © 2013 IBM Corporation

18. Innovation@IBM IBM’s innovation portfolio reflects the tremendous creativity and contributions of many organizations – both within and outside Generally  Available l IBM Industry  Solutions l l IBM Business  Partner Solutions Product & Service Offerings l l Maturity of Tech-  nology/Solution l l Emerging Business Opportunities l l IBM Research Services l l “Bleeding   Edge” First Of   A Kind l Ideahub l IBM Basic Research Projects IBM / Client Joint Innovation l AlphaWorks IBM Institute for Business Value – studies and PoVs l IBM Applied Research Projects l Academy of Technology l TAP / BizTech IBM-led   Innovation !18 l CIO-fund Acquisitions VC Backed Firms  (Late Stage) Idealabs, Jams l l l Seed-stage Startups University Programs Extreme Blue Involvement of  External Partners l Startups / Entrepreneurs External-led  Innovation © 2013 IBM Corporation © 2013 IBM Corporation

19. Innovation@IBM Innovation as a core discipline at IBM INSIDE Identity Challenges/ Create Ideas Mobilize Interest, Mobilize Interest, Collaborate Collaborate Incubate, Prototype and Validate Implement, Take to Market IBM Lines of Business Internal Stakeholders Global Technology Outlook Clients OUTSIDE FOAK IBV reports !19 Partners © 2013 IBM Corporation

21. Innovation@IBM IBM’s research and development IBM is 19. year in a row leading the way in IT-reasearch by having: – a yearly R&D-budget of six billion dollars – over 3.000 researchers, scientists and engineers – five Nobel prize winners – eight research laboratories in six countries – 24 development laboratories worldwide ! IBM has the most IT-patents in the world: – In 2011 IBM beat its own record with 6180 patents and can call itself world champion in ”most granted patents.” – Over 50.000 active patents globally ! IBM’s number of non-IT-related patents is growing: – Patents regarding organisationaldevelopment, solutions and business processes !21 © 2013 IBM Corporation

22. Innovation@IBM A successful Research Division….. § Clearly defines its success goals § Leads through partnerships § Leverages its global presence § Couples with outside world § Partners with its customers § Is constructively self-critical § Focuses on productivity To be successful, IBM Research must enable employees to grow and develop in their careers!! !22 © 2013 IBM Corporation

23. Innovation@IBM IBM Research: Globalization Dublin§ Smarter Cities Zurich Almaden § Analytics § Storage § Nanotech Healthcare Austin § Semiconductors § Processors § Science Watson § Nanotech § Semiconductors Materials § Systems § Software & Services China Haifa § “Big Data” Analytics § Security § Internet of Things Tokyo India § Services § Mobile Communications § Industry Solutions § Accessibility Africa Brazil § Natural Resources § Smarter Devices § Human Systems/Events § Next Gen Public Sector § Water & transportation § Human Capacity Development Australia IBM Research Labs § Natural Resources § Disaster management § Healthcare/Life Sciences (60% funding from gov’t) IBM Research – Openings in 2011 IBM Research – Openings in 2012 !23 © 2013 IBM Corporation

25. IBM Research IBM Research: Collaborative Innovation China Watson Almaden Austin IBM Research Lab Global, Smarter Planet Collaborations !25 Zurich Pangoo Tokyo Haifa India

26. Innovation@IBM We engage in public/private partnerships, like the EDISON and ECOGRID projects on Bornholm § § § ! § ! § § § § 4 !26 Total budget: 24 million Euro (EU funding 13 million Euro) IBM: 171 man months, around 2.2M DKK of servers and other equipments, IBM SWG products (ILOG, WAS, MQ, DBMS) Demonstration > 50 % of budget (excl. replication/ deployment) A large scale demonstration of a real-time market place for distributed energy resources A demonstration of a real power system with more than 50 percent renewable energy ! To implement ICT systems and innovative market solutions - offering TSOs additional and more efficient balancing services ! To enhance small consumer and local producers to participate in the power market through real-time operation, energy storage and savings ! To make a prototype solution for Europe - offering a “fast track” option towards market-based Smart Grids in Europe © 2013 IBM Corporation

27. Innovation@IBM First of a Kind Program (FOAK):  IBM jointly invests with clients on cutting edge innovations § A Collaboration among Research, Sales & Distribution, Clients and Partners § Experimental technology-based solutions engagements BPI for Core Insurance • 50%-60% reduction in work effort • 55%-65% reduction in project duration § Testing tomorrow’s innovations on real business problems and new growth opportunities § Yielding prototype solutions across a range of industries § Clarifies client requirements and tests market readiness § Established in 1995 § 20 – 25 projects funded each year § 70% successfully transfer assets for reuse § 75% drive or influence additional business § Some Danish / Nordic FOAK projects: § Intelligent Oil Fields for Statoil, Aker a.o § ASME – medical information hub – with Aarhus University § Intelligent Trade Lane – Maersk Smart Surveillance for Intelligent Oil Fields • Breakthrough in discovery of anomalous patterns • Accurately demonstrated sand production prediction 23 days in advance during trial Customer Lifetime Equity • Reduced marketing costs by 20% • Improved response rates by 10% • Improved customer sat by 10% © 2013 IBM Corporation

28. Innovation@IBM Container Centralen, using advanced secure RFID tags to solve a business problem and provide opportunity for new services  Started in 1976, the CC system was created due to demand for a solution to transport flowers and plants !28 80.000 users across 22 countries in Europe, e.g. growers, auctions, transporters, exporters, retailers Based on an exchange system, leading to increased efficiency and lower number of containers needed © 2013 IBM Corporation

29. Innovation@IBM The IBM Institute for Business Value research in market trends, best practices and process on a business and industry level. Our Objectives § Content: Create extraordinary, fact based business insights § Market Impact: Differentiate IBM in the marketplace § Value Creation: Value-based approach to identify and deliver client results § People Growth: Attract, retain and motivate top GBS talent !29 Our Focus § § § § § § § § § § § § Our Research Types Our Deliverables Distribution Financial Services Industrial Public Strategy & Change Innovation CRM Human Capital Supply Chain Financial Management Application Innovation Emerging Markets § Future Agendas § 3 to 10 year industry and/or functional area outlook with action oriented next steps § Value Realization Studies § In-depth assessment of today’s critical issues, opportunities, and value potential § CXO Surveys § Chief officer studies § Executive Briefs § Quick Read (Executive Summary) § Event and Conference Presentations § Blue Paper (What and How to Sell) § Knowledge e-cards § Pod/Webcasts § Books § By-lines and articles © 2013 IBM Corporation

31. Innovation@IBM What are   Jams? ! How do Jams work? How IBM has used Jams How customers  are using Jams An introduction • A massive online discussion using the Internet. • A time-limited event that can elicit participation from thousands of individuals anywhere in the world. • Subject-matter experts and moderators guide participants to build on each other’s ideas. • Advanced real-time text analytics and moderator tools • Sharing the value with participants - give to get !31 © 2013 IBM Corporation

32. Innovation@IBM Global collaborative inside/outside-firewall innovation Jams  enterprise-wide discussion, collaboration and decision-making, examples §Real-time threaded discussion §Open idea-rating §Equal access by all employees WorldJam 2001 ! Anew collaborative medium to new collaborative medium to capture best practices on 10 urgent IBM issues !32 ValuesJam ValuesJam 2003 ! An in-depth exploration of IBM’s in-depth exploration of IBM’s Values and Beliefs by employees ! ! WorldJam 2004 ! 2004 WorldJam ! Focused on pragmatic solutions aroundon pragmatic solutions focus growth, innovation and bringing the company’s solutions around growth, innovation and To life bringing solutions to life ! ! ! InnovationJam InnovationJam ! 2006, 2008 TM For the first time, IBM’s clients, IBM’s clients, Business Partners, and our business partners and Family members joined in a family members joined in a new collaborative exercise new collaborative exercise © 2013 IBM Corporation

35. Innovation@IBM Idea management goes social – the Innovation Hub model Engaged business leaders share their challenges with the community Successful ideas get communicated and celebrated Community leaders review ideas – implementing successful ones Employees respond by posting ideas and collaborating !35 © 2013 IBM Corporation

36. Innovation@IBM Innovation Hubs 24x7 innovation marketplace § Localized collaborative innovation model for directed results § Next iteration of ThinkPlace program § Integrates Lotus Connections social network with idea sharing § Sharing business needs, innovation, implementation and recognition § Estimated impact of idea programs: – 45% new revenue opportunities – 37% time savings improvements – 18% cost savings improvements – cultural suggestions !36 © 2013 IBM Corporation

37. Innovation@IBM Innovation Hub: 24x7 Idea Marketplace § Open, collaborative system: ideas submitted, discussed, then refined by community § Every employee can see ideas from others, comment on ideas, rate them, or tag them § Facilitates social networking by using tags  to enable discovery of similar ideas and people  with similar interests § Personalized action lists with simple workflow  for idea evaluation and collaboration § Executive Challenges request ideas to  address specific issues § Hundreds of Catalysts worldwide facilitate  collaboration and implementation in their areas of expertise § Linkage to prototyping/validation programs (BizTech & TAP) and other resources § Innovator’s Awards for implemented ideas ! !37 http://ideas.tap.ibm.com/i_dir/ihubidea.nsf/ © 2013 IBM Corporation

38. Innovation Fund l Encourage innovation by funding small solutions l Bring employee ideas to proof of concept and beyond l l l l Ideas from bottoms up: è New solutions - explore new technologies/areas è Fix problems - small fixes can have big benefits Projects selected by cross-organization Review Panel og Prediction Markets model 3-10projects each round, funded to prototype 28 Projects Funded since start 2.5 years ago, 20 completed (400 ideas submitted) ! Benefits – lowers barriers for ideas to get implemented ! Sample Project Wins ! Text Analytics within the Global IT survey process (19 days down to 1 per question set) ! l l l l !38 BlueThx – digital/social, company-wide peer-to-peer recognition © 2013 IBM Corporation

39. Innovation@IBM Innovation Hub: BizTech prototypes deliver proof points § Top talent from across the company gain opportunity to work on innovative projects one day per week for 6-8 months ! § Senior business and technical leaders serve as project mentors ! § Projects sponsored by business unit managers and executives “[ThinkPlace Prototyping] provides a stage for people who have an innovative idea and want that idea to be transformed into valuable business for IBM.” - Participant ! § Staffing and project support provided by ThinkPlace corporate innovation team § ! Measurable results presented at Showcase event twice annually © 2013 IBM Corporation

41. Innovation@IBM TAP Examples: Hard to find the right person, the right information, the right tool FACES a faster, more intelligent people search About 14000 visits a month ! ! ! EXPERTISE LOCATOR Employees can share Areas of expertise 10,000 logins, over 100 experts contacted by end users ! ! ! ! ! ANSWERS find and provide answers Approximately 8000 users per month !41 © 2013 IBM Corporation

43. Innovation@IBM Technology Adoption Program Distribution channel for innovators 2.999+ Innovators Technology ! Adoption Program 168.000+ early adopters concepts & ideas hundreds of offerings: hit 1.276000 downloads in 2013 Enable innovators Measure Value Engage the Community IBM PRODUCTS OFFERINGS production enables the route to market !43 © 2013 IBM Corporation

45. Can you afford to ignore Innovation@IBM a better way of working Measured Benefits together?Software in IBM of Social ! ! ! Why Corporate Soc+al Networks Matter For!most!organizations,!collaboration!is!not!just! – 87% of IBMers collaborating with others using social software increase skills important,!it!is!essential.!Working!in!teams!or!with!others! is!simply!the!way!work!gets!done!today.! – 84% access experts quicker But!the!way!we!collaborate!is!rapidly!changing.!Work! force!demographics!are!shifting,!workgroups!are! becoming!more!global,!people!are!becoming!more!mobile,! and!new!tools!are!transforming!the!work!place.! – 74% increase their productivity – 64% improve personal reputation As!business!leaders!wrestle!with!their!collaboration! strategies!and!decide!how!to!manage!all!the! – 84% share knowledge with others communication!and!content?management!tools!they!have! now,!their!people!are!already!building!corporate! – 77% re-use assetscommunities!and!social!networks.!What!is!driving!this! move!to!corporate!social!networks?!Are!they!in!your! ?term!best!interests?!And!how!should!you! respond!to!this!new!wave!of!collaboration!technology?! – 64.5% improve personal reputation – 64.5% increase their sense of belonging The!best!way!to!answer!these!questions!is!first!to! network!and!determine!the!benefits!to!your!business!and! – 59.9% increase sales to!your!workforce.! – 42.4% improve customer satisfaction ! ! ! ! ! End Notes! 1) 2) !45 ! People work+ng together dr+ve bus+ness results You!are!wasting!time.!Find!out!why!:!The!Cost!of!Ineffective!Search ;!!Brodkin,! John;!!Network$World,!January!23,!2007! 3) 4 Information,!Technology!and!Information!Worker!Productivity ;!! Sinan!Aral!,!Erik!Brynjolfsson!and!Marshall!W.!Van!Alstyne;! NYU$%$Stern$School$of$Business$,$Massachusetts$Institute$of$Technology$(MIT)$%$ Sloan$School$of$Management$and$Boston$University$%$Department$of$ Management$Information$Systems$ Justifying!Instant!Messaging!Investments? ;!!Cain,!Matthew;!Gartner$Research! 4) Costs!of!Employee!Turnover ;!!Bliss,!William;!Bliss$&$Associates! 5) © 2013 IBM Corporation Engaged!Employees!Inspire!Company!Innovation ;!Gallup$Management$Journal! Understanding!the!True!Cost!of!Disengagement ;!!Hewitt$Associates!

51. Innovation@IBM IBM and the Venture Capital Community IBM Credibility & visibility “Gives” IBM Revenue Growth “Gets” Expertise Expanded ecosystems Infrastructure Strategic insights GoTo Market activities Portfolio Gaps addressed VC Community Acquisitions IP 3 © 2013 IBM Corporation

53. Innovation@IBM Case Study: The Solution: Advanced power management and Smart Grid solution for enterprises ! Development • IBM Innovation Center La Gaude • Cloud enabled • IBM hardware, software integration • Enterprise-ready, SAFE approved • IBM Cognos Analytics on top ! Mentoring and Networking • Technical road with IBM IDR experts in Europe and US • Business planning with IBM E&U Industry experts ! Sales and Marketing • Marketing material, exhibition in IBM Forum in Kgs. Lyngby and La Gaude • • • 4 On-going joint projects with large customers Joint go-to market in Europe, US and Australia Part of IBM Smart Grid Solutions portfolio © 2013 IBM Corporation

54.   Innovation@IBM Social Media Outside the IBM Firewall examples ( incl Alumni) 80+ accounts using “IBM” in the name (25% from outside the US) – over 3,000 IBMers on Twitter 200+ IBM channels 39,000+ users, 500+ IBM groups (65% outside the US) 378,000+ (*including Alumni) 166 communities, 200+ blogs, 5000+ profiles 75,000+ 100,000 IBMers collaborating with 200,000 non-IBMers !54 © 2013 IBM Corporation

55. Innovation@IBM Innovation Discovery Client Program for mutual benefits Extreme Blue for Clients Clients who need an introduction to Innovation at IBM Innovation Discovery Explore FOAK Curriculum Strategic Value Creation Clients that are ready to focus on specific problems and look for innovative opportunities Innovation Discovery Focus Customize Innovation Discovery Define 360/Collaborative Innov New IBM Offerings & Major transformation partnerships Incubate • Academy Studies for Clients • Virtual Collaboratories • Project Definition Workshops • + others Software Business Dev Channels for Development of Cross-Brand Solutions Existing IBM Offerings © 2013 IBM Corporation

57. Innovation@IBM IBM develops the future of shopping with one of the world’s largest retailers Comfort  Shopping Smart  Check-out Infrastructure WLAN Server Content Bus RFID   Inventory   In-store  Information Management !57 © 2013 IBM Corporation

58. Innovation@IBM AlphaWorks  - Speeding IBM Emerging Technologies to the outside early-adopter community § Promising software programs in research not yet commercialized. § Outside companies and developers contribute valuable ideas about bringing them to market. § First-cut versions of research technology available for free trial attracting thousands of early adopters, innovators, and entrepreneurs to site. § 40% of technologies on the site graduate into IBM products or industry standards.    © 2013 IBM Corporation

59. Innovation@IBM Wider IBM Resources External web pages • • • • • • • • • • • • • • • • IBM Research Global Innovation Outlook Collaborative Innovation with IBM IBM Institute for Business Value IBM Smarter Planet First-of-a-Kind Projects IBM Jams Technical Exploration Centers IBM Innovation Centers IBM Software Labs IBM Systems & Technology IBM Design Centers IBM Benchmark Centers IBM Executive Briefing Centers IBM Watson Ecosystem Innovation Discovery • IBM Global Entrepreneur • IBM Voices (social media agregator) 67 © 2013 IBM Corporation

60. IBM Research ! ! Anders Quitzau Innovation Executive ! andersq@dk.ibm.com +45 2880 4705 ! about.me ! ! ! ! @Anders_Quitzau Anders Quitzau AQuitzau Aquitzau !60

How IBM innovates dec 2013 - the front end of innovation in IBM

You are reading a preview.

Check these out next

How IBM innovates dec 2013 - the front end of innovation in IBM

More Related Content

Slideshows for you (20)

Viewers also liked (19)

Similar to How IBM innovates dec 2013 - the front end of innovation in IBM (20)

More from Anders Quitzau (11)

Recently uploaded (20)

How IBM innovates dec 2013 - the front end of innovation in IBM