IBM surprised Wall Street earlier this month with unexpectedly good Q2 financial results. (CNET's Larry Dignan wrote an excellent summary.) As with Oracle, IBM's profit surge came amid declining revenues, and once again, a CFO's boasts proved rather revealing.
An article in yesterday's Wall Street Journal plumbed IBM's success at converting business advisory to tech consulting, and consulting to software sales (but not, ultimately, hardware sales). To quote:
- "'We look for the consulting arm to lead our entry to the client,' driving sales of other products, says IBM Chief Financial Officer Mark Loughridge."
It's old news that IBM's Global Services arm has become a bigger part of the company with each passing year. But what sometimes comes under dispute is whether IBM consultants actually push IBM technology over those of competitors. "We do more [BEA] WebLogic implementations than [IBM] WebSphere," one Global Services consultant protested to me a couple of years ago, in an attempt to compare his employer to the likes of Accenture. I took him at his word, but all the anecdotes that cross my path seem to suggest otherwise. (Check out, for instance, this oldie but goodie from 2005.)
I won't begrudge IBM its success. And other major consulting firms can exhibit serious conflicts of interest as well. But you the customer have to remain alert to the consequences. Consider the following hypothetical sequence:
- Your executives bring in IBM for some business re-engineering (perhaps you've seen the commercials)
- At some point -- for better or worse -- this devolves into a technology program
- Your organization makes a big investment in WebSphere-based middleware
- Your web team gets forced to use WebSphere's bundled Web Content Management tool
If you want to know what's wrong with that last step, you can consult our Web CMS Report. Of course, some version of this sequence can happen with Oracle, EMC, and Microsoft, too. (And the particular travails of accepting a WCM tool from an ECM vendor are well-known to some Alfresco customers.) But the larger point here is that IBM has evolved sales-via-consultant into a science, particularly with its emphasis on initial "business" consulting after its PriceWaterhouse acquisition.
In the end, let's ditch that old canard about "not getting fired for going with Big Blue" and admire their big profits instead. Then let's also acknowledge that you need to take firm responsibility for making the right technology choices for your enterprise, regardless of the consultants you hire.