IBM Moves to Reinvent Commerce

Michael Vizard

One of the sadder truths concerning the way business transactions are conducted within most enterprises today is that chaos reigns. More often than not, different lines of business are using different transaction processing systems, while the Web team operates in isolation from the rest of the business. Worse yet, the tools used to analyze these transactions are either rudimentary or non-existent, which leads to all kinds of product shortages and lost revenue opportunities.

At the first annual Smarter Commerce Summit, IBM today said it wants to help companies rein in all that chaos by leveraging a raft of new IT offerings designed to return control of the business to the managers responsible for running it.

To achieve that goal, IBM is pulling together products and services based on software from its Sterling Commerce, Cognos, SPSS, Coremetrics, Unica, Netezza, ILOG, WebSphere and FileNet product lines that are now available in a mixed mode of on-premise and cloud computing delivery models. The basic idea, says John Mesberg, is not to create a rigid commerce framework based on an enterprise resource planning (ERP) application as much as it is to allow customers to mix and match products and technologies by leveraging open RESTful application programming interfaces.

Mesberg says he expects a lot of companies to be interested in IBM's cloud computing offerings because they provide a simplified way to rationalize many of the rigid, fragmented systems they currently depend on for processing transactions. For example, IBM is now making available a configure, price and quote system along with a PCI-based payment system as a cloud computing service to complement existing analytics systems. Mesberg says IBM doesn't expect customers to move their entire commerce system infrastructure to the cloud, so in order to facilitate the development of hybrid systems that span both cloud and on-premise systems, IBM will be making greater use of the Cast Iron middleware technology that the company acquired last year.

Craig Hayman, general manager for IBM industry solutions, adds that the ultimate goal is to break down the silos that currently exist between various commerce systems to make it possible for changes in demand that are identified by marketing teams in real time to then be used to dynamically adjust orders across the supply chain. The end result, says Hayman, is that instead of having a purchasing cycle based on a yearly or seasonal calendar, the purchasing process becomes continuous.

In order to execute transactions at this scale across multiple organizations, IBM concedes that most businesses will have to engage in some major process re-engineering, which is one reason that IBM is devoting over 1,000 people to create Smarter Commerce centers of excellence around the globe.

Smarter Commerce projects of this type and scale obviously require commitment from the senior business leadership of the company. But it's becoming clear that business leaders are not only demanding a more flexible IT environment, they are also starting to appreciate how to use IT to fundamentally change business outcomes for the better.

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