Sunday, April 2, 2017

IBM is Everywhere and Things are 'A Changing

by Brenda J. Christie

Motley Fool's Timothy Green does an excellent job of succinctly summarizing some of the highlights of IBM's 2016 Annual Report in his March 20, 2017 article.

The article highlights how IBM, through Watson, is using huge amounts of data to improve results and reduce costs in areas ranging from healthcare, to transportation (the airline industry) to banking and other industries subject to regulation.


Through IBM's 2015 purchase of Merge Healthcare (covered on this blog in Socially Conscious IBM post) as well as its purchase of Truven Health Analytics a year later, IBM's Analytics revenue (part of its Strategic Imperatives) increased 9% from 2015.  What this means is that huge quantities of data can be quickly analyzed and presented to researchers and doctors to enable better and quicker cures and prognoses and consequently save lives.  To health care companies, it also has to potential to drive down costs through more accurate diagnoses in less time.


IBM's analytic prowess is also apparent in the airline industry, both on-land and in the air.  Through its 2015 acquisition of the Weather Channel, IBM has provided the means for airlines to reduce one of its largest operating costs - fuel.  As Timothy Green's article points out, airlines are able to react quickly to turbulence and in doing so reduce fuel costs due to the availability of data analyzed by the Weather channel.  IBM's MobileFirst for iOS and Watson iOT applications enable maintenance crews on the ground to quickly respond to flight delays and to have the required crews readily available for airplane maintenance.

Paper, Paper Everywhere!

Other areas where IBM Watson is being employed include the legal, compliance and tax fields where millions of pages of changes and requirements can easily cost companies millions of dollars to peruse and encounter risk of hefty fines for non-compliance.  Timothy Green estimates these fines and penalties to be in the vicinity of $250 billion annually for banks alone.


As is to be expected, security continues to be a significant business concern.  IBM's revenues attributable to security increased 9%, as reported in its 2016 4th quarter 2016 and 2016 full year press release, 


In summary, through recognizing and taking advantage of changing business needs and innovations, IBM continues to be relevant.  Despite the continued commentary of naysayers that it has outlived its heyday, hardware (which includes mainframes) and operating system software still generated $2.5 billion of revenue for IBM in 2016.  Indeed, Timothy Green's article (read it here) reports that 90% of global credit card transactions are still handled by mainframes!

To read Timothy Green's 10 Key Numbers from IBM's Annual Report, click here.  The IBM 2016 Annual Report can also be read in its entirety here.

Bye for now,

Brenda J. Christie