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© 2011 IBM Corporation
Running an information-services business within a
large corporation
March 2011
© 2011 IBM Corporation
IBM Market Insights
Our job is to help IBM grow.
 We start by aligning our work with the company’s...
© 2011 IBM Corporation
IBM Market Insights
3
Our Knowledge Services team serves a large portion of IBM
employees worldwide...
© 2011 IBM Corporation
IBM Market Insights
44
Knowledge Services – how do we deliver these
insights to IBM?
 Self-Help To...
© 2011 IBM Corporation
IBM Market Insights
55
MI Self-Help Tools for 24X7 Service
 bluemine provides a single entry point...
© 2011 IBM Corporation
IBM Market Insights
66
 MI Knowledge Center supports over 20,000 individual requests a year
 Know...
© 2011 IBM Corporation
IBM Market Insights
7
How Do We Measure Value?
Growth in page hits and downloads
Growth in unique...
© 2011 IBM Corporation
IBM Market Insights
8
Our Self-Funding Model Is the Basis for All Services We Deliver
Every year w...
© 2011 IBM Corporation
IBM Market Insights
9
How do we build our budget*?
Electronic
delivery
COMP Knowledge
Gate
Knowledg...
© 2011 IBM Corporation
IBM Market Insights
10
How Do We Price Services?
Pricing methodology is based on some key principle...
© 2011 IBM Corporation
IBM Market Insights
11
How do we bill?
 Collect and verify usage/billing data from each of the
app...
© 2011 IBM Corporation
IBM Market Insights
12
Key Considerations for Implementing a Self-Funding Model
1. Keep it simple.
...
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Running an Information Services Business within a Large Corporation

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Mark Pandick (IBM) provides insight into providing information services to a for profit business.

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Running an Information Services Business within a Large Corporation

  1. 1. © 2011 IBM Corporation Running an information-services business within a large corporation March 2011
  2. 2. © 2011 IBM Corporation IBM Market Insights Our job is to help IBM grow.  We start by aligning our work with the company’s priorities.  We build new assets and expertise where needed.  We prioritize and execute our work as one team.  Our unique insight and tools give business leaders the confidence to take the actions required to drive growth for IBM.
  3. 3. © 2011 IBM Corporation IBM Market Insights 3 Our Knowledge Services team serves a large portion of IBM employees worldwide. Sales Scientific & engineering Marketing IBM Knowledge Services Competitive how-to-win Company information Lead generation tools Product comparisons Technical journals Computer science Physics Engineering Market sizing & forecasts Global news & research Brokerage research IT analyst services Industry sources Emerging markets Three main targets: Marketing Sales Scientists & engineers
  4. 4. © 2011 IBM Corporation IBM Market Insights 44 Knowledge Services – how do we deliver these insights to IBM?  Self-Help Tools – find the information yourself 24 x 7  MI Knowledge Center – send your information requests to our Knowledge Center analysts
  5. 5. © 2011 IBM Corporation IBM Market Insights 55 MI Self-Help Tools for 24X7 Service  bluemine provides a single entry point to conduct a high-level search across multiple internal and external sources  COMP is IBM's premier competitive resource – access valuable toolkits to beat IBM’s competition  KnowledgeGate brings together external sources (news, scientific & technical, and market research) where users can conduct in-depth searches across these sources  Market Insights website can be used to browse research produced by IBM's MI organization and to learn more about the MI discipline
  6. 6. © 2011 IBM Corporation IBM Market Insights 66  MI Knowledge Center supports over 20,000 individual requests a year  Knowledge Center Relationship Managers are aligned by MI client teams and have in- depth knowledge of the IBM business needs and secondary research sources. MI Knowledge Center for synthesized client, industry, and competitive-related research
  7. 7. © 2011 IBM Corporation IBM Market Insights 7 How Do We Measure Value? Growth in page hits and downloads Growth in unique users Expansion into new geographic regions Embedding content into different workflows Usage by business units Cost savings delivered through centralized purchases Improved efficiency to find information Customer satisfaction Successful Self-Funding Model
  8. 8. © 2011 IBM Corporation IBM Market Insights 8 Our Self-Funding Model Is the Basis for All Services We Deliver Every year we start from the premise that we have no budget The self-funding model includes: Research requests to our Knowledge Center Document delivery (mostly for scientific-engineering content) Search costs on internal systems where we deliver external content The self-funding model is designed to fully recover costs of: Content IT systems, maintenance and development People
  9. 9. © 2011 IBM Corporation IBM Market Insights 9 How do we build our budget*? Electronic delivery COMP Knowledge Gate Knowledge Center 2011 Total Microbilling funding 1,000 12,000 5,000 1,500 19,500 Client flow-through funding 15,000 0 1,700 300 17,000 Total funds 16,000 12,000 6,700 1,800 36,500 Funding YTY +10% +8% -3% -20% -5% Total projected content program spend 15,000 11,000 6,100 900 33,000 Spending YTY +6% +20 -4% -8 +5% Net Surplus (Deficit) 0 1,000 600 900 3,500 Infrastructure and IT - - - - 3,200 2011 Net Surplus (Deficit) - - - - 300 * Budget numbers are illustrative
  10. 10. © 2011 IBM Corporation IBM Market Insights 10 How Do We Price Services? Pricing methodology is based on some key principles:  accurate forecast of demand and recovery (based on historical usage and trends, and customer demand)  product prices that aim for breakeven point  flexibility to manage as a portfolio of services as needed Pricing options we use:  price per each research request  subscription cost for single-user seats to expensive IT analyst research  annual subscription cost for use of an application with enterprise access to content single search/session costs for sci-tech content, i.e. IEEE  ‘free’ access to enterprise services and/or reports purchased elsewhere in IBM  pass-through expenses from internal clients for vendors with which we have relationship
  11. 11. © 2011 IBM Corporation IBM Market Insights 11 How do we bill?  Collect and verify usage/billing data from each of the applications/services  Assemble into billing tables  Pass verified billing data with individual charges rolled up to departmental billing codes via US and international financial systems.  To accomplish this we have our own Financial Control Desk that manages these processes and transactions  We have passed rigorous financial process and certification requirements to allow us to operate and enter financial data that affects IBM’s bottom line
  12. 12. © 2011 IBM Corporation IBM Market Insights 12 Key Considerations for Implementing a Self-Funding Model 1. Keep it simple. 2. If users value the services, let them vote with their dollars and be willing to pay a fair price for what they use. 3. A microbilling model can minimize large budget targets and direct expenses to where they are consumed. 4. If starting from scratch, it will take a substantial effort to get line Management, Finance, and IT behind you. 5. You’ll need resources to build, run, and maintain an accurate billing and financial system. 6. In IBM there were significant financial certification hurdles to allow us to pass data to our corporate ledger. 7. The model has been very beneficial, as our proof point, to continue to deliver our value services to IBM in such a cost-driven environment.

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