Honest Vendor Ratings – IBM

Introduction

A company that needs no introduction, IBM has been one of the giants in computer hardware and software since there was computing. It now makes most of its income from software and consulting.

Quality of Information Provided

IBM provides the very low quality of information to its customers.

Consulting and Support

IBM Global Services is one of the major consulting companies. As IBM is more services business than software driven, IBM has a great deal of credibility with some clients with regards to technology advice. However, the problem is that all of IBM’s advice comes with a heavy financial bias – that is they are serving as a “trusted advisor,” but curiously all of their recommendations lead to the selection of either IBM or partner software (i.e. Oracle or SAP) for which they have large numbers of resources for which they can bill. How a firm can be both a trusted advisor while they both own applications, and have resources trained on specific products, is difficult to understand. In fact, it is a joke. IBM has a clear and indisputable conflict of interest in any recommendation it makes. IBM as with any of the large consulting companies lengthens the amount of time projects take in order to maximize billing hours, and has their clients implement very complex applications which are most often uncompetitive solutions.

Internal Efficiency

IBM’s is an enormous company with a correspondingly low-efficiency level.

Innovation

IBM was at one time an innovative company and is still the number one producer of patents in the US. However, this is entirely not evident from evaluating their applications. In fact, IBM is one of the great Fake Innovators. This is a bit like analyzing Microsoft, which has 90,000 people that work for it, but its impossible to tell from actually analyzing the company’s output.

When one looks at IBM’s enterprise software offerings, they are almost entirely acquired applications that receive very little software development and typically obsolesce several years after the acquisition. IBM advertises its innovation in areas like hardware and it does employ scientists that do actual research, and in things like “big data,” but we rate them as a laggard and a last choice in data applications. IBM’s large number of patents may have something more to do with how the company has the resources to invest in the patent process – which is expensive, and IBM’s weak actual innovation compared to its patent ownership also says something about software patents generally, which are by many patent experts not considered particularly legitimate. It also says something about our patent system that it can be gamed by large companies like IBM that have the resources to put into patent applications creating the illusion of innovation. As a counterpoint, none of the best of breed software vendors that we analyze, that are actually the most innovative companies have very many patents.

IBM is primarily a serial acquirer for software that it does not improve, and which it then uses its connections into its large customer base to sell into.

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