System iNetwork

September 2008

September 22, 2008 9:47 AM

Top Ten IT Problems We Don't Have . . . with IBM i

It seems to me that the value propositions of IBM i and the Power Systems they run on have gotten a bit muddied of late--or perhaps diluted. So in the interest of good positive fun, I'm thinking we might be able to restate some of these benefits of a Power System with IBM i--either from a hardware, software, business, or IT pro perspective. Please post your thoughts, serious or funny--all are welcome. If all goes well, in a few days, I can hammer out a more presentable top ten list, which might be handy to have . . . or to forward along to a CIO. I'll get us started:

IT Problems We Don't Have with IBM i:

• Virtual Machine Sprawl
  Background: In an interesting twist, the so-called answer to x86 server sprawl has more recently been to virtualize the servers, which, because of their ease of implementation, has resulted in data centers littered with unseen virtualized servers, some of which even get misplaced. Because IBM i can handle such scalable workloads, in addition to multiple applications, VM sprawl isn't a problem with IBM i.

Got any to add?

Posted by cmaxcer on September 22, 2008 at 9:47 AM | Comments (30)

Are You in Dallas at COMMON Directions This Week?

If you're attending the COMMON Directions 2008 two-day conference in Dallas this week, consider sharing a bit of your experience with the rest of us who remain chained to our desks. First impressions of the two-day event? Any particularly interesting nuggets of information rise to the surface? Got any juicy new bytes of IBM IT gossip? Just kidding about that last part. Kind of. Seriously, consider posting a comment. Tell your friends.

Posted by cmaxcer on September 22, 2008 at 9:46 AM | Comments (2)

September 17, 2008 9:55 AM

SMB ERP Running Strong for VAI--Despite a Lagging Economy

VAI is one of the longest living System i and IBM i-focused ERP solution providers--and that fact is an anomaly in and of itself. The company's ERP suite, S2K Enterprise 5.0, was just released, and get this: it still runs on i5/OS-IBM i and only i5/OS-IBM i. VAI hasn't rejiggered its ERP solutions for a Windows, Linux, or Unix market--the company is all about the i.

And more importantly, the strategy seems to be working.

I spoke with Joe Scioscia, VAI's VP of sales, and Kevin Beasley, VAI's CIO, to talk about what the company has been seeing in the market these days, as well as a bit about the new S2K 5.0.

VAI's largest customer generates about $2 billion in revenue each year, but VAI's sweet spot tends to be with smaller and medium sized (SMB) businesses that bring in $20 to $500 million each year. S2K 5.0 has modules that focus on wholesale distributors, manufacturers (both process and discreet), and specialty retail, which is usually for customers that combine wholesale and retail operations: building materials, HVAC, lighting showrooms, furniture, sporting goods, and the like.

No Economic Slow Down Here

"We were worried about the economic slowdown but we really haven't seen it in our segment, and I'm attributing that to the notion that companies in the SMB segment are trying to do more with less and they need to get their systems in place to accomplish that," Scioscia says.

"They need to be more lean and have more efficiencies in their buying, picking, shipping, and manufacturing processes, and these companies are now turning to technology to keep them afloat. We are not seeing much of an economic slowdown and our pipelines have never been more full," he adds.

Plus, from an IT perspective, he notes, "Our message of lower total cost of ownership is also resonating with these business as they come down to make a decision. As they look at the System i platform--now Power Systems, obviously--and hear our message about lowering their IT staff costs, that it's virus resistant, all-inclusive, and supported by IBM--that's a message that's resonating with our new sales."

And, it turns out, about 50 percent of VAI's sales are customers who are new to IBM--they are new System i/IBM i installs.

Working the Channel

While VAI is part of most every IBM promotional Business Partner program, including the successful Vertical Industry Program, IBM only drives about 10 percent of sales toward the ERP company. VAI goes to market through a reseller channel of 100 resellers in the U.S., Canada, and the Caribbean, with a direct sales force, too.

So what about competing with ERP heavyweights SAP and Oracle, both of which have been announcing targeted efforts to penetrate the SMB ERP space for years?

"They still are not priced right for the SMB market, even though they think they are," Scioscia says. "They are going to have a tough time with any customer that's under $300 million, for a number of factors."

The implementation cost is usually the biggest problem, he explains, and occasionally the actual license fees are getting more palatable to smaller customers. But the implementation cost can be 3-to-5 times the cost of the license fee whereas VAI's implementation costs are closer to 1-to-1 or 1.5-to-1. Because VAI is the author of the software it's installing, it can be much more efficient with the install process--not to mention more knowledgeable about the ins and outs of the solution.

S2K 5.0

"The main applications are still written in ILE RPG built over the DB2 database," Scioscia says. "We're using Seagull's graphical rich client, and what that enables us to do, from an end user perspective, is really provide a very attractive Windows look-and-feel user interface."

VAI also uses IBM's WebSphere Portal with its S2K Enterprise Portal. "We're getting a lot of traction with that lately. What customers are starting to understand is that it's not just e-commerce anymore. We're seeing them open the portal to their own sales forces, for CRM . . . to do things with the portal they haven't done in the past," Scioscia notes, including using VAI's mobile device interfaces for devices like the Apple iPhone.

"We're really seeing a convergence of technology in the enterprise, the web, with wireless, and our customers want to take advantage of these technologies to better serve their customers," Scioscia says. "And to take advantage of any efficiencies in their own business."

So what about push back over the "aging" System i? If half of VAI's customers are new to the IBM i world, how does VAI deal with misperception?

"We always still see that . . . and I think that comes more from our competitors. I think the mindset of our customers who are questioning that . . . is it is often coming from our competitors who are planting it--a Windows guy selling a Windows-based solution will come in and tell a prospect, 'Oh, the System i, that's an AS/400, that's old technology and it's going to be sunsetted'," Scioscia says.

"If we come in and make a pitch, our pitch resonates very well. First of all, it's easy to tell them that this is new technology because it just came out. It's the latest and greatest from IBM. In fact, the processor that's in this unit is the world's fastest chip. Once they start to hear that, they start to understand that what they've been told or what they've heard third-hand may not be true," he explains.

"It usually tends to work in our favor at that point," Beasley adds. "Some of those tactics that used to work in the past aren't the best tactics anymore."

And for IBM i lovin' aficionados, that is good news indeed.

Posted by cmaxcer on September 17, 2008 at 9:55 AM | Comments (1)

September 8, 2008 9:30 AM

PowerVM on the Rise

The last time I spoke with Ross Mauri, general manager of IBM Power Systems, he mentioned IBM's new PowerVM virtualization technology and his thoughts on what's going on with virtualization. It was a side note, really, in a conversation about the System i and IBM i financial performance and IBM's quarterly reports, but Mauri made a few points I've been wanting to share. Today, it turns out, is the day for sharing.

"One of the interesting things for the quarter," Mauri said, is that "64 percent of all orders went out with PowerVM, which is starting a significant uptrend. In past years, the virtualization technology was mostly used on the high-end systems, a little on midrange, and not below. And now we're seeing very good penetration in midrange and even down into the 550 systems. So our PowerVM story is resonating with customers and penetrating across the line."

So why do I bring this up now?

As the new Power System lineup settles down and IBM i versions become available across the line, there's a good chance that we'll have some decent sales that can help provide some trend news. Besides, in the history of all IBM name changes and name creation, I can't think of a better move than "PowerVM"--especially as the x86 virtualization world heats up as Microsoft's Hyper-V and VMWare's suite battle for mind and market share.

In addition, Mauri noted seeing some anecdotal movement. Of IBM's larger customers, "Some were into virtualization before, some had decided not to try it all . . . but now, they are all thinking through virtualization options because of both the flexibility it gives them and the better HA characteristics," he said. "I would expect that 570, 595 i clients will--there will be a major shift to a virtualized world over the next two years, and I'm watching that closely, and that's my prediction. Smaller and mid-sized customers in the mid-market . . . I think there will be a lot who will buy 520 and towers, but I also think we'll begin seeing a significant shift to blades."

No matter what the adoption rate is, if the only good that PowerVM brings to the IBM i world is the knowledge that it exists alongside other modern virtualization solutions, that's still good for i.

Posted by cmaxcer on September 8, 2008 at 9:30 AM | Comments (3)

September 3, 2008 9:43 PM

Business As Usual for PowerTech After Help/Systems Acquisition

In a security and compliance-focused interview with John Earl, CTO and VP of PowerTech, my colleague, Linda Harty, and I had to ask about the surprisingly quiet acquisition of PowerTech by Help/Systems and its private equity muscle.

Basically, much is as we already suspected or was previously reported: PowerTech will retain the PowerTech brand and continue to run as a separate company that's focused on security. While there are some areas of synergy for customers and the product lines, it's going to be business as usual for PowerTech.

"I think it's really a great fit between a couple of companies that have carved out leadership niches in the OS/400 utility space. I'd like to think PowerTech has carved out a leadership spot--I know for sure that Help/Systems has," Earl said.

"What we're seeing here is a couple of really good companies coming together and we're in a position to augment each other's products. We've had interfaces to Help/Systems' Robot/ALERT and Robot/CONSOLE products in our Authority Broker and Network Security products for as long as I can remember. They are just a natural fit and we never thought we'd go out and build a competing kind of product because we knew that the Robot products did that message management and the alerting capabilities so well," he noted, adding, "There's just a number of great places where we fit together and I think these two product lines can add a lot of value for both of our customer sets."

For the full interview that focuses on security and compliance, check out Linda's "Straight Talk About Getting Your Company into Compliance" post on Product Lines.

Posted by cmaxcer on September 3, 2008 at 9:43 PM | Comments (0)