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The sort of managed services that Johnson purchased are the type that Gordon Haff, a senior analyst at Illuminata Inc. in Nashua, N.H., believes are IBM's real future in the midmarket. "I think the most interesting long-term play for them is in managed hosting services," Haff says.
"In general -- especially midmarket -- companies do not get competitive advantage out of running most of their IT themselves," Haff says. "It makes a huge amount of sense for them to outsource the things that aren't core to their business. Because IBM is not coming to your shop, you don't have to worry about enlisting IBM Global Services for a custom engagement." That way, midmarket CIOs needn't be concerned about any surprise fees from IBM, he adds. "You're buying in most cases a fairly well-defined service [like MessageLabs], and you can compare the price to the alternatives."
IBM is also joining forces with some of the world's largest software companies, such as SAP AG, to appeal to midmarket customers. In August, IBM and SAP announced that Oneida Ltd. had chosen an IBM Express mySAP All-in-One package -- basically SAP software running on IBM hardware -- with IBM playing the part of implementation partner.
"We were looking for a solution that IBM had put together a model for," says Rob Hack, senior VP and CIO at the 125-year-old flatware company. "IBM really is leading us through the process. We were looking to do a global ERP project as quickly as possible, but as thoroughly as possible."
Was he worried about bringing two huge companies together to bear on a $350-million company? "There was the usual concern that goes along with choosing companies the size of SAP and IBM," Hack says.
Initially, the Oneida CIO was handed a boilerplate contract, which he summarily rejected. "It's almost insulting," says Hack. In hashing out the contract negotiations, the two vendors took about nine weeks, and Hack made sure Oneida got a fixed-price, fixed-scope implementation. "Our services agreement with IBM is very much based on a defined scope. We had a date we wanted to hit, and also our statement of work -- our contract of work -- with IBM is very detailed. It's right down to the business processes and functions. It ensures that we are all on the same page."
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