IBM is placing a US$1 billion bet that helping businesses better manage and glean insight from their data will be a profitable software and services business.
The company said Thursday that its software business will develop more advanced information management software while the number of service consultants dedicated to this area will grow from 15,000 to nearly 25,000.
"Any data, any format, anywhere, and at scale," was the mantra voiced by Steve Mills, senior vice president and group executive, IBM Software, at Thursday's press event. "It's all about the quantity of data and the speed at which you need to get it."
IBM provided details on a range of new software and services geared toward improving information management.
On the services side, IBM's Business Consulting Group rolled out a half-dozen new offerings that specifically target business challenges such as analytics, risk and compliance, business processes and workforce productivity.
On the software front, IBM discussed two new products that incorporate technology gained during IBM's shopping spree of software vendors in the past year. The first, WebSphere Information Server, incorporates technology IBM gained through its acquisition of data integration software maker Ascential Software in March last year. It allows businesses to pull data together from a variety of different federated sources, said Mills.
The software combines IBM WebSphere Data Integration Suite's information integration capabilities and IBM WebSphere Information Integrator's federation functionality with new service-oriented architecture (SOA) service publishing capability.
It will be available in the second quarter of 2006.
The second offering, WebSphere Content Discovery Server, is search software based on technology from e-commerce search technology developer iPhrase Systems, which IBM acquired in November last year. IBM is offering different flavors of the tool geared for online shopping sites, contact centers and self-service portals. The software uses content integration, search, semantic analysis and contextual information to interpret the underlying meaning of online inquiries and to make recommendations based on those interpretations, IBM said. For example, if an online shopper misspells a word or uses jargon, the system is designed to recognize that. The software is available now.
Globalization, mergers and regulatory compliance are among the chief drivers for businesses seeking to better manage information, IBM said.
One user at Thursday's event is using IBM software to analyze data on Medicaid claims that could potentially save money for taxpayers in the state of New York.
The Medicaid program is the most expensive program for New York counties, said Scott Vanderhoef, county executive for the New York State Department, Rockland County, who spoke on a panel at the event.
"Just for Rockland County alone we spend over a million dollars a day on this one program," he said.
The county used IBM's Fraud and Abuse Management System software in a pilot program to look for aberrations in past claims for a 21-month period. IBM provided the software as a service for the county and ran the claims through its own supercomputer.
Of the provider claims evaluated in the pilot program, nearly half were deemed questionable. If those questionable claims were successfully resolved, Vanderhoef estimates the county could recover nearly US$13 million.
"Even if half of those were resolved, that's still pretty good savings," he said.
But now that the data has been collected, the next step for the county is how to reap the potential savings from it.
"Now the question becomes who is going to do the footwork to walk into these places and do forensic audits to check which are fraud," he said.
Vanderhoef said IBM is also developing software that could allow the state of New York to spot aberrations in claims before they are paid out.
"You're talking about mining and harvesting information that has always been there and using it to actually change how you do business, in this case to save money for taxpayers," said Vanderhoef.