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IBM Gives IT Services a Product Makeover

Shifts its focus to packaged offerings that can be repeated for different users

October 2, 2006 12:00 PM ET

Computerworld - IBM last week formally announced a major change in the way it will sell its portfolio of IT services, rolling out the first two of more than 30 “service products” that it expects to begin offering by year’s end.

The initiative is aimed at turning IBM’s customized services into standardized, product¿like offerings that can be repeated at different user sites, according to Marisa Viveros, director of a new integrated communications services unit within IBM Global Services.

“It’s almost like a cookie cutter,” Viveros said, although she added that IBM still expects about 30% of its work on individual projects to be devoted to customization efforts.

The packages unveiled last week are networking services designed to help IT managers with IP network convergence and IP telephony projects. But an IBM spokesman said that by year’s end, the company will announce service products across the entire range of its services portfolio.

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Christopher Smith, IT director for the Bath Central School District in Bath, N.Y., said he understands how IBM might be able to generalize the work it does on projects such as voice-over-IP installations.

But Smith questioned whether the school district — which has spent $1.5 million over the past three years on a converged voice and data network, with IBM as its systems integrator — would still get enough hands-on guidance from the IBM workers who know his specific needs.

“The beauty of working with IBM Global Services has been having the same main contact person the entire time,” he said. “I hope that wouldn’t change with the new system.”

David Komaromi, manager of technical services at Fraser Milner Casgrain LLP, a law firm in Toronto, said he has been working with IBM on an IP network-convergence project for more than two years.

Komaromi said he has benefited from IBM’s close relationship with his firm during the $1.5 million project.

But he added that he sees the value of taking proven methodologies and creating more standardized services for new customers.

“I don’t see their service products idea as a rigid approach,” Komaromi said. “There will always be that level of customization.”

IBM didn’t release pricing information on the two networking services. But Bob Djurdjevic, an analyst at Annex Research in Scottsdale, Ariz., predicted that overall costs will be reduced for customers and that projects will be completed more quickly.

“Rather than reinvent the wheel, you can put together the basics,” Djurdjevic said. He added, though, that the new approach will impose a large cultural change on IBM’s IT services workers and sales force.

Wu Zhou, an analyst at IDC in Framingham, Mass., said that IBM’s service product strategy appears to be the first on the market, although she added that “the idea is bubbling up in the industry.”

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