How Strategic Partnerships Help IBM Deliver AI And Hybrid Cloud To Customers

Building strong partnerships is important for every business, and this is no less true if you are one of the oldest and most respected technology companies in the world.

IBM spent the last 12 months evolving the IBM Ecosystem. Called Partner Plus, it’s designed to ensure the right relationships are in place to deliver emerging technology solutions to clients. And right now, there are two technologies in high demand – artificial intelligence (AI) and hybrid cloud.

To maximize its ability to roll out these technologies and support clients with consulting expertise, as a part of the IBM Ecosystem transformation, it was decided to focus on a short list of core partnerships, which includes many of the world’s largest hyper scalers and ISVs. Known as the "blue partners," these are Adobe, AWS, Cisco, Microsoft, Salesforce, Samsung, and SAP. IBM has even gone as far as creating a new partnership tier to manage these valuable relationships, ensuring they work together to create the most innovative and cost-effective solutions for their clients.

I was recently joined by Nick Otto, Head of Global Strategic Partnerships at IBM, for a conversation to discuss how strategic partnering enables organizations to provide value equivalent to more than the sum of their parts.

Strategic Partnering Benefits

Otto told me one of the biggest changes to the partnering strategy was the creation of the blue partnership tier embedded into the overall IBM Ecosystem program. He said, "We've got a whole tier just for blue partners – and that has enabled us to align better with resellers, service partners, and build partners. These strategic partners are industry-leading cloud service providers and infrastructure and software vendors that partner with IBM Consulting™ and IBM Technology Solutions. When combined with IBM, these partners are the most relevant and recognizable technology players in the world. Collectively they are responsible for over $1T+ in global technology purchases, have over 100M developers and have incredibly strong brand value as well as market pervasiveness.”

The Blue Partner designation maximizes collaboration between IBM and its strategic partners, matching resources, strengths, and capabilities to ultimately create the best products and services for our joint clients.

“What I’m most excited about,” said Otto, “is the technology embed component of our blue partnerships. IBM and our partners both have highly differentiated technology capabilities and when they are brought together, it truly is a 1+1=3. This is leading to the development of partnerships that are more holistic. And further, IBM Consulting then provides the deep expertise to deploy these solutions across the entire suite of applications offered by both companies.”

“For example, with SAP, we've announced our AI collaboration taking Watson capabilities and bringing them into SAP while exploring new advances in generative AI. And if you look at Adobe, we are partnering on embedded AI and GenAI. They’re a significant adopter of Red Hat OpenShift as well.”

All blue-tier partners have three things in common: First, they have a meaningful impact on IBM’s business (ex. AWS, Microsoft and SAP are all $1B+ revenue), and second, they engage across IBM’s ecosystem, from technology to consulting services. Most importantly, they are all in alignment when it comes to IBM’s strategy of focusing on deploying AI and hybrid cloud for its customers.

Otto told me, "Our strategic partners … are very aligned with the IBM core technology objectives – and the two we hit on consistently are hybrid cloud and AI … there's always a hybrid cloud angle, and there's always an AI angle."

Managing Relationships and Competition

With such high-value partnerships, effective relationship management is crucial. At IBM, this is done by appointing a managing director for each partnership to ensure there is executive-level oversight. Their job is to ensure that the strengths and skills of each partner are fully focused on solving client problems.

Otto said, "That manager has a relatively small team … driving the 360-degree relationship with that partner across everything we’re doing and across all parts of IBM. They own that relationship and own that roadmap.”

What makes this particularly interesting is partnering often involves working across fields where two businesses might be competitors. Otto told me this is because it’s become apparent the value that can be achieved for the clients by working together far exceeds the value either organization would achieve by working alone.

"If you look at the things IBM does today, on the surface, our portfolio competes with pretty much everybody … however there are things we're really good at, and there are things they're really good at. The opportunity and joint value to come together and solve problems for our customers far outweigh those competitive areas."

It’s true, however, that this is new thinking – and that this openness to cooperating, even with competitors, marks a significant cultural shift.

"IBM saw working with respected technology companies like AWS and Microsoft as an opportunity to achieve great things for our clients," said Otto.

The Future?

Although IBM currently works with seven blue-tier partners, that list is not set in stone. The partnerships are consistently reviewed to ensure they are offering clients the most potential.

"We place our bets," Otto tells me. "We don't have a lot of churn. But I would expect some additions over the coming years.”

Assessing new potential partners is a case "where we take a step back and say what are you guys great at? And what are we great at? And how can we help our end customers do more?"

Otto said that although the hype cycle might top out this year, he expects AI to remain high on the agenda for most of IBM’s customers.

“The more we’re able to figure out collaborative opportunities with our AI, and with our partners’ AI, to improve each other’s products jointly – that’s the part I’m most excited about going forward.”