IBM's future looks wobbly in Shaky Isles

Speculation is mounting here on IBM's future following the INCIS police computer system debacle and the loss of the Telecom New Zealand outsourcing deal to Electronic Data Systems (EDS).

Opinions at the recent Telecommunications Users Association of New Zealand (TUANZ) awards ranged from: "IBM is pulling out of New Zealand" to "They'll cut back to around 80 staff". (See "NZ, Colorado telco file suits against IBM," 27 August, page 32 and "Telecom NZ signs $NZ1.5b outsourcing deal," 23 July, page 8.)Computerworld has been canvassing the market and has come up with this likely scenario.

Heading the likely changes, IBM New Zealand managing director Ken Symington was said at TUANZ to be packing his bags. There's not really enough left to manage, was the view. IBM has been in close talks with two of its resellers, CSI and Madison.

In recent times, much of IBM's product has been directed through these two. It seems that's only going to grow.

Direct selling will become even more a thing of the past. IBM will probably become a product agency for Big Blue overseas. Product will be directed through the resellers. This will create a much lower overhead, and loyalty from business partners will be greatly enhanced.

The sales force is likely to be rolled into the services group, which will become, in effect, IBM in New Zealand. The bloke who was betting that IBM will become a company of around 80 people is probably not that far wrong. IBM recently beefed up its global services operation in New Zealand. It has hired former Price Waterhouse systems integration expert Elaine Ford to head that side of the operation. Among others, several experienced CSC people have been added to the mix.

So, who gets to be the face of IBM? Al Monro, who used to head the Auckland operation, was recently named national sales manager, replacing Mark Giles, who has moved on to Alcatel. Monro is a long-time industry professional, deeply steeped in the IBM culture. Ford, on the other hand, might be riding the cusp of the "women can do anything" wave.

However the scenario plays out, IBM has to move quickly. Uncertainty about its future is the last thing its customers, its staff and the industry in general needs.

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