Enterprise Technology Marketing at Scale:
Doug Brown, CMO, IBM Systems
Enterprise Technology Marketing in a Huge Organization Enterprise marketing at a large scale involves working across organizational boundaries to develop strategies that work for a broad range of customers.
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Enterprise Technology Marketing in a Huge Organization
Enterprise marketing at a large scale involves working across organizational boundaries to develop strategies that work for a broad range of customers. Data and analytics are important parts of the marketing toolkit, along with a deep understanding of the complex relationship between Chief Information Officers and other parts of the customer business.
Our guest, Doug Brown, is Chief Marketing Officer for the IBM Systems Group, part of IBM Systems and Technology, which had revenue of $10 billion in 2014.
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Michael:
(00:04) Marketing is a huge huge topic. What happens when marketing takes place in a huge huge company like IBM? Today, on episode number 116 of CXO-Talk, our guest is Doug Brown the CMO of IBM Systems. I’m Michael Krigsman and I’m here with my co-host Vala Afshar, hey Vala how are you?
Vala:
(00:35) Michael well I’m great and it’s an honour to have Doug with us today to talk about big marketing in big companies. Hello Doug.
Doug:
(00:46) Hey Vala how you doing, Michael, good to see you guys again.
Vala:
(00:50) It’s great having you on the show and perhaps we can kick off the show with you giving us and our audience a little bit about your background and a little bit about IBM Systems.
Doug:
(01:00) Sure, well first off thanks a lot for having Big Blue on the show today, and talking about big marketing’s. So congratulations on 116 episodes. But yeah, let me describe because IBM restructured the company back in January of this year and the IBM Systems unit was created from that restructuring.
(01:22) And we are a business of about $20 billion, a little more than $20 billion a year in revenue, and we serve IT infrastructure executives with both the provision of hardware, servers, and storage as well as middleware. We combined our middleware brands of WebSphere, Tivoli, and Rational, along with our server brands, Power and ZSystems and our storage portfolio altogether to form the systems unit and we just did that this January. So is really kind of a new unit within the company.
Michael:
(01:57) So tell us about the $20 billion, what a huge company you are within IBM. So tell us about your division, tell us who you are selling to, what are you selling, and what are the key focus points.
Doug:
(02:13) Yeah, it is an amazingly huge business. What we’ve done by combining all the hardware and all the software that I just described is really a lineup to our key customers in the way that they think about their business.
(02:24) We market to IT infrastructure executives, you might see that in the form of titles like Head of Operations for IT, or even Chief Technology Officers, CIOs or even application development executives.
(02:39) And what we do is we help those folks evolve their existing IT operations to meet the demands of the future. We’re at an unbelievable point in time in the history of the IT industry. Things are changing so dramatically, lots of shifts happening and our customer, the IT infrastructure executive has got to deliver new forms of service in this environment and we’re here to help them do that.
Vala:
(03:07) Can you talk a little bit about the scope of marketing for IBM Systems delivering you know, $20 billion of revenue to IT infrastructure executives.
Doug:
(03:19) Sure we do all the classic, which you would consider product marketing. We craft who we are in the market, what we want people to believe about us and our capabilities in the market, we do all the product marketing, the content marketing. We do all the demand generation, digitally through traditional campaigns.
(03:40) We have an events team that coordinates all of our events activity. Social team of course, and we’re structured pretty much like you would expect for a large marketing organisation in a large company. We have a worldwide team that kind of sets the agenda, and builds material and then we hand that to about 25 different regional teams around the world who deploy the campaigns into the markets.
Michael:
(04:05) We have one clarification question from Twitter, from Frank Scarvo, who is one of the top enterprise software analysts, and he just wants to clarify are IBM’s cloud offerings within this new division or outside of it.
Doug:
(04:23) That is a great question, because at the same time we created the systems unit we also created cloud unit. So we are two units that are in parallel, but just like with customers connected. The cloud unit provides to the market our software infrastructure as a service, offerings provides our Bluemix platform as a service offering provides our key dev-ops capabilities that all comes through the cloud unit.
(04:49) What we do in the systems unit is we are really the on premises side of hybrid cloud implementations. So we are taking existing servers and existing infrastructure and integrating it with the cloud capabilities, so that together we give a customer a hybrid cloud capability. The two units work together, but they are different.
Michael:
(05:13) And how from a marketing standpoint then obviously the cloud and on premise parts are two sides of one coin. And so how do you work with your cloud counterparts in order to present a unified picture to a customer who may be wanting to deal with both sides.
Doug:
(05:34) Great question. The way we do it is we kind of have a major and a minor. So within the cloud unit, our marketing leader, whose office is literally right next door to mine. She takes the lead on the hybrid cloud overall messaging and we put input into that point of view, from our perspective and we deploy one point of view, one marketing campaign around hybrid cloud into all the markets that works for both our units. So that’s kind of the way we do it. Cloud unit takes the lead, we contribute and then we go to market together.
Vala:
(06:10) So you talked about Doug the velocity of innovation and IT infrastructure and a lot of folks have been talking about digital business transformation that includes marketing IT, use of technology. Can you talk a little bit about marketing goals within IBM Systems and how you I’m assuming, have modified some of your goals given the transition that is taking place around IT and business and industry as a whole.
Doug:
(06:36) Yeah, well I have a particular goal in mind and for the portfolio for the business I represent and that is to reposition ourselves in the market at this unbelievable point in time of change.
(06:47) So you know, things have been so stable for so long, people have been buying products into the architectural stack that’s been defined for 20 to 30 years. People buy servers when they need servers. They buy databases when they need databases. But all of that is kind of now up in the air based on the conversation we just had about the opportunities for cloud and all that sort of thing.
(07:09) So what I have as a goal is to reposition the portfolio that we have to be seen as helping those IT infrastructure executives evolve what they have so that they can connect and integrate into the cloud in the future. And not be seen as a kind of historical base of technology that’s actually drifting away, because that is not the case. So we have a goal to shift the belief of what we stand for and what our capabilities are.
(07:37) That’s of course a goal that never ends and stays constant with the transformation and repositioning one’s self in the market as it changes. Along with that, right side-by-side with it of course is good old demand generation goals, that’s kind of what keeps our business operating. We are clearly in the front seat of the demand generation capability of our business.
Michael:
(08:00) Now, the role of the CIO is changing because you reorganized the company and you mentioned that was to respond to your customer’s needs. And of course your customers, the CIOs are changing. And so what are the dynamics that you’re seeing among those customers. What are the changes that you have seen have taken place, and continue to take place?
Doug:
(08:28) Well obviously this whole move for digital business transformation is around the need for the speed of innovation. And speed of innovation is accelerated with some of the things that we talked about just a few minutes ago that our cloud capabilities.
(08:44) That platform as a service layer for development like our Bluemix solution provides an unbelievable ability to rapidly develop new mobile applications. What’s happening though is that for an enterprise to transform those new systems of engagement have to connect with, integrate with in a development cycle with the systems of record that already exist on premises.
(09:12) So the issues that CIOs are dealing with and an issue that IT executive infrastructure is dealing with is how do I create that integration of speed of innovation through cloud with what I already have. Because the last thing I want to do is just leap to a cloud implementation and create myself an island that doesn’t integrate with what I’ve already invested in previously.
(09:38) So that’s what we’re seeing CIOs and IT executives I’m deal with is this integration of speed and innovation capabilities by cloud, along with what they already have. And there’s a companion problem that has to be dealt with at the same time. And that is as the nature of these systems of engagement change, and as the nature of applications change, for example embedding analytics in them more and more frequently, the technical capabilities in the infrastructure itself have to change.
(10:16) And so we are going through a period of time where IT infrastructure executives, CIOs have got to be able to deliver new forms of service rapidly, without really knowing exactly what those new applications are going to be.
(10:35) So that’s kind of a dilemma, if you think about in the old world it was very simple. I’ve got an application, a line of business, know exactly what it is, and we know how to do requirement definition, and we know how to scope it out. Develop the application, test it, QA system test, deploy on an infrastructure that we define. And now with the speed of innovation in the types of technologies required for these new applications there’s some uncertainty about what it is that I’m going to have to deliver on my infrastructure two years from now, five years from now.
(11:09) So we are seeing a lot of questioning about how do I build out this infrastructure so that I can be ready for anything that comes in the form of requirements in the future.
Michael:
(11:19) Okay, so you’ve described what’s happening among your customers. Now what are the implications of that for you as the CMO of this $20 billion IBM division?
Doug:
(11:38) It’s interesting, because when the customers start asking this question in a period of shifting sands underneath their feet, their questions go from, tell me about your products because I might be interested in buying one compared to a competitive alternative. To instead, help me understand how I should be thinking about designing, building, and managing this new type of environment going ahead.
(12:07) So our marketing has to shift from a product centric based form of marketing to a very authentic audience based centric form of marketing, and that takes a certain amount of skill sets and other attributes that we’re all shifting on at the moment. This whole shift from product centric to buyer centric marketing is a major move for us.
Michael:
(12:36) So basically thought leadership.
Doug:
(12:38) It is thought leadership. It’s having a point of view. It’s forcing us to work very very closely with the CTO’s of our divisions internally and our development leaders to understand what they’re building into the portfolio in going forward and why you know, why is it that security is so doggone important and is a lasting pillar of all that we do in our product roadmaps. And we have to be able to learn that, understand that as marketers, and be able to communicate that to customers. Not just that our products have security in them like 100% encryption for transactions or whatever it is.
(13:17) But how then that changes the way they manage their infrastructure; that’s the important part now, it’s answering the how question and not just the what question.
Vala:
(13:29) So Doug as you just mentioned CIOs, you mentioned Chief Technology Officer. I’ve just read the Harvard business review post that said an average B2B buying decision team is around six, so you have different personas and when we talk about thought leadership, having buyer segmentation as part of the marketing strategy helps tailor the message to the different personas that make up the buying decision team.
(13:57) How do you deal with segmentation and precision marketing, knowing that thought leadership is really an important element of having your message resonate with your target consumer buyers?
Doug:
(14:12) Yeah, that’s a great great point, because what’s happening obviously is knowing the buyer is as important as knowing the product right. So you know, thanks to our senior VP and CMO of the whole of IBM, we’re doing something together. Every one of our units in the company, not just the systems unit, but we are thinking about this notion of a cohort.
(14:34) So in the old days it was a segment rights, common wants and needs, common buying behaviour and we would build marketing plans for a segment. As we move from you know B2B to B2i marketing for the individual, we think we are doing that in an evolutionary way, and the first step of course is role-based marketing where we understand the role. But we are trying to take that to the next revel right now, which we call cohort based.
(15:00) Within a role, understanding the differences in behaviour of different elements of that role for example, there may be Vice President of operations who know and understand IBM very very well, and continue to buy from us. There may be others who don’t know and understand IBM and buy from our competitors. Those are distinct different behaviors that we would say are two different cohorts, and so we are building our content in our marketing campaigns differently for each of those cohorts.
(15:31) So we are putting out content, where if you know us you could be attracted to it in one way. If you don’t know us it’s a different conversation, and we can attract people who don’t know us to think about is differently. It puts a lot of demand on our portfolio marketing teams to build content that’s empathetic to the actual cohort based on their behaviour. But that’s the level of sophistication that we need to get to.
Michael:
(15:55) Now we have another question from Twitter, from James McGovern, who is an enterprise architect and I’m going to leave it up to you whether you want to answer this one or not. But he’s asking – well he’s actually asking for a dissertation on a comparison between IBM and HP. I don’t know if we have time for dissertations, but you can take that one or not as you prefer.
Doug:
(16:24) There’s probably not enough time for the discussion on IBM versus HP. You know, we are clearly about equal size companies in the same space, but for different orientations, and I would probably want to leave that one for another day and maybe spend the whole 45 minutes on it.
(16:47) Clearly a lot has been written about that in the analyst community, so that’s another place to go for that comparison.
Vala:
(16:53) We can have you back on another show and that’s the whole of the show we could tackle. So historically speaking, and you’re an experienced marketer can you in a few minutes talk about how marketing in B2B has changed over the last let’s say last decade.
Doug:
(17:12) I think we kind of touched on a little bit previously. When I first you know got into marketing it was all about a segment. And we really don’t think much about segments anymore, we really do think about the individual.
(17:26) You know, we are not quite at the point of marketing to the individual yet. You know, sophisticated elements of data and understanding of behaviour at the individual level in order to be able to do that. That you know maybe others in retail are a little bit further ahead of us than we are in that regard, but we’re getting there.
(17:49) I think this whole notion of ultimately marketing to the individual, but for us, decomposing segments down into recognizable buying behaviour and at the cohort level within the role. Redefining our whole content that way and then putting it out digitally and tracking how it is being picked up and used.
(18:07) That is like a huge huge shift for us. I think 10 years ago we would be segment based. We would be event oriented almost exclusively. Now we’re cohort behaviour-based and digitally oriented and you know, that’s a major shift in a 10 years period of time.
Michael:
(18:26) So what is the implications for that for your marketing, for your go to market and for your marketing campaigns, and also for the skills and the competences that you need for the marketers that are working with your group.
Doug:
(18:42) It’s a massive shift Michael. I mean I think just the need for empathy within our marketing and empathy towards the buyer is huge. It is actually a differentiator when we can really build content that is empathetic about the buyer and the problems they have, the struggles that they’re going through, and the way that they might perceive something.
(19:05) So, you know it used to be you could be a pretty good marketer if you understood your product and if you could stand up and pitch your product and talk about its feature functions and benefits, and link it to a business problem. That doesn’t suffice any more.
(19:16)Now, you’ve got to add to that equally, the understanding of the buyer, their challenges, their problems, how they think about things and that just changes the whole content that needs to be developed. So that’s a massive shift for the skills of people choosing marketing as a profession.
Vala:
(19:38) We’ve had large company CMO’s like Jonathan Becker, former CMO of SAP talk about having I think Michael, he mentioned one, to a dozen to 18 data scientists that reported to him within marketing. When you talk about skills in marketing it feels like – and I don’t know if you are familiar with Scott Brinker, who creates this annual super infographics of marketing technology companies, and there are about 1900 marketing technology companies and a couple of years ago there was only a few hundred.
(20:06) So an explosive landscape, and now you have the analytical side, so it seems definitely a balance of art and science in order to be able to be a successful digital marketer. Can you talk a little bit about the profile and the type of talent that you see that will be critical within marketing in the next few years.
Doug:
(20:27) Well I think there are some attributes that are common for successful marketers. I mean it’s not necessarily what you might think initially which is, I’m not going to go down the path of mechanical skillset of marketing, but I think having a passion for curiosity and constantly asking questions and solving the next problem, having passion for innovation. You know, being inspired about putting marketing content out and seeing how it’s reacting and received in the market, and always solving that big puzzle.
(20:59) These are the kind of mindset I think that make good marketers in the future, and of course then we get to the data that will give us the answer to some of those questions and that the curiosity causes us to ask. So I think there’s some personality traits around behavioral sciences, combined with curiosity that will define marketers into the future.
(21:21) By the way on all of that technology that you mentioned that is out there from marketing, don’t forget IBM is a provider of some of those technologies as well. We use our own, we use Unitgov for our marketing automation and core metrics and Silverpop and tea leaf some of our own businesses that we’ve built in that whole space.
(21:44) That’s a whole other unit of IBM, talk about companion units of our company, their systems, there’s cloud, there’s analytics and then there is our, commerce unit that has all of our marketing tools in it and connects that to commerce for retail industry.
Michael:
(22:02) So Doug, I’m going to ask you to connect a few dots for me. So on the one hand you are selling highly technical and complex products, into a technology market, selling to CIOs and others in IT. And at the same time you’re talking about empathy as being as a core marketing skill, and you have to have deep expertise in the products, and the features and so forth. So how does empathy play a role in the importance of marketing and how you go to market today?
Doug:
(22:41) Well let me tell you first and make sure the point that I was making is that I think knowing the product is as equally as important as being empathetic with the user, so there is a 50-50 kind of ratio there. But I think increasingly as marketing becomes teaching, as causing people to act is increasingly driven by providing lessons of things that are possible, and how to do things that marketing then takes both those attributes of knowing the product and being empathetic to the user, and puts that into the context of teaching. Whether that teaching is done digitally, or whether it is done at an event, or whether it is done in community circles or whatever it is.
(23:28) Interestingly enough, my wife of having been a teacher for 30 years, I think there is an awful lot in parallel between good marketing and good teaching.
Michael:
(23:42) So know your product, have empathy, and teach.
Doug:
(23:45) That’s it, that it and the teaching, just like building a lesson plan has to be crisp. The content has to be crisp and there is a whole other piece of this which is effective communications and the skills to communicate crisply and succinctly and on point and that is another dimension of course.
Vala:
(24:10) Doug talk to us a little bit about data and analytics and the role it plays in marketing and then maybe you can tie it to some of the products that you mentioned. I would love to learn a little bit more about the products from IBM in the marketing space.
Doug:
(24:25) Yeah, we’re making advances in the whole data analytics. We’re starting to deploy marketing around integrated teams, sub-directed teams, and we are combining digital strategists with digital analytics persons as kind of the data scientists that you described. With social capabilities, with content marketing, with campaign designers and event specialists.
(24:48) And they are all assigned and work together as a team over a segment as the business, so that whole data dimension is and absolutely critical, and across our whole company we are moving to a consistent platform for marketing that will help us in that regard, especially digitally.
(25:06) At the moment where we are is we’re are heavy on tracking on the two ends of the spectrum. On the very first phase of tracking activity of social impressions, unique site visitors and all of those kinds of things that gives us a sense of volume. And then on the very backend, the amount of responses we turn into leads and how much that is a value in our pipeline that we provide to our sales folks.
(25:34) That piece in the middle is where we have got a lot of work to do still to understand the flow every step of the way, through rates etc. So we are building out as we speak across our company, our corporate team is to give us these capabilities. The notion of a dashboard that can aid us on a daily basis with the kind of data that we need in order to run the business.
(26:02) It does break down for us, it’s different, for different parts of our company. I’ll give you an example, within our cloud unit, our Bluemix platform as a service area, that’s a product we just launched less than a year and a half ago. And kind of like Greenfields it’s completely digital, it goes after the one buyer which is the developer and that team has been able to really lead the way for us on digital analytics data driven marketing, because they are really able to start almost from scratch.
(26:35) Where we are taking some of these big businesses like Michael was talking about, multi-million dollar complex technology, multiple buyer groups, a little bit harder for us data driven in that type of an environment.
(26:49) Now some of the things we do, we have Unica is our offering around marketing automation platforms, so that’s doing all of our campaigns, design tactic, tracking etc. now, we have a product called Core Metrics that we use to tag webpages to track activity of our digital presence on our own IBM.com domain. Then there is some other acquisitions that we’ve made that really help retailers into the whole individual customer behavior tracking capabilities. So we’ve not applied that yet in my business, but we are helping clients apply it in their needs.
Vala:
(27:29) We have a question from Twitter from Arsalon Khan, and he asks, when will IBM’s Watson be used in the marketing organisation, if it’s not already.
Doug:
(27:42) Yeah, that’s a great question. It’s certainly getting pervasive in a lot of the things that we do, Watson is, whether it’s in healthcare or customer service, or what have you and no, I don’t see it get into the marketing toolkit, but that’s got to be an eventuality no doubt about it, because that is a breakthrough technology that is going to change the world for all of us for sure.
Michael:
(28:08) Okay, you don’t I am really fixated on this notion of empathy as you are describing it. It is such a new element in the marketing mix and so there are very well established mechanisms and ways to teach people about products and features, and product market fit. But when it comes to empathy it’s kind of out of left field, especially for those of us who are in technology, we’re you know so intellectual. How do you teach that, how do you cultivate that inside your organisation and thinking about empathy for the customer.
Doug:
(28:52) That is a great great great question and there is a couple of different ways that I know we are experiencing already. Our team for our business in Asia for example has an adopt a salesman approach and you know, we are still very heavy outbound face-to-face sales as a company and our marketers are going out with a salesperson that they are buddying up with and making customer calls, and listening to the customer describing their problems, how they approach and solving them and what questions are on their mind. That keeps us fresh.
(29:25) Companion to that we have an expectation, that if you are doing portfolio marketing you know the portfolio well enough, then you will present it to customers. You will present it to analysts, and in so doing you get the interaction you need to learn about the buyer and become empathetic.
(29:40) A third way, we have a pretty significant design capability in IBM with a design app in the US based out of Austin, Texas, where our designers have come from places like the Savannah College of Art and design, really work on the user interface of our software products and get into the science of interaction. Now, putting marketers with designers in the experience to understand how the user interface can be changed and affect the marketing at the same time is a whole other way to build empathy, linking up designers and developers and marketers in for example SaaS products.
Michael:
(30:24) That’s very interesting and actually of Savannah College of art and design was one of my clients in the past and what an amazing place. And so maybe can you drill a little bit into that linkage between the type of customer experience and the type of things that you were just describing, and the cultivation of empathy and understanding the customer, and I’m sure that communication is a key part of it as well.
Doug:
(30:49) If you were to walk through our design centre at IBM, you would see designers from schools like SCAD, working for us today, white boarding personas with names and interactions around their role what they are thinking about, just as we as marketers do. And then you would see them working on user experience around that role. So we are starting to talk a very very common language and share an insight together between product designers and marketers. It’s an amazing thing.
(31:28) So you know, we used to team up very closely and we still do with sales of course in the field. But now we are teaming up really closely with the people on the development on the design side, and they talk the same language, and have the same interests.
Vala:
(31:43) Can you talk about in your opinion, what are some of the biggest challenges that marketers face today, and a follow up to that is there any cool technologies that you have seen in the front that if we see wider adoption we can perhaps manage these challenges and turn them into opportunities to benefit marketers, customers, and organizations as a whole.
Doug:
(32:06) The biggest challenges that stand in the way of marketers at the individual marketer level I divide that into two different groups. I would break that into the group of marketers who have started marketing relatively recently in their career, and maybe they are out of University within the last couple or three years, and they are on something and they don’t know any different. They are at state of the art, and they are challenge is rate of adoption, great of learning. And I am seeing marketers with that profile really accelerate their learning because they are getting out in front of all the things that we’ve just been talking about. And that is an amazing thing to watch.
(32:46) But the challenge is rate of learning, rate of adoption for that population.
(32:53) The other population is you know those of us that have been at this for a while have got to make a shift, kind of like your question about 10 years ago versus today, there is a shift going on. And the biggest challenge is to agree to make that shift and to agree to be open to that shift and like that shift. And in some cases marketers are going to say, you know this isn’t necessarily what I wanted to do. It’s time to go and do something else, maybe move the sales, but in other cases where there is desire for personal growth and development, again just being open to new ways and ways of doing things.
Michael:
(33:29) Okay, you mentioned new ways of doing things and shifts. There’s a word for that, that word is innovation. So how does your group, your organisation think about innovation. Is it just something sort of random thing, or do you have programs in place, or is it somewhere in between? How do you innovate?
Doug:
(33:48) Great great question, we are making a shift on how we innovate Michael!
(33:56) I think sometimes in very large organizations people look to the innovation that comes from the top of the old hierarchy organisation, and be driven down to the troops kind of like, here’s the tablets and perform these 10 things and your life will be good.
(34:11) But we are flipping. In my unit what we do is we’ve created a expectation for innovation at the individual marketer level, and we follow that up with a quarterly innovation award. So we’ve flipped the organisation upside down. And what we do is once a quarter, we have an innovation team, which is the executive team, and we invite up to 5 individual teams, and believe they’ve done something new, and exciting and different and seen results from it, they come and share their ideas and what they’ve learned with us.
(34:51) From those five examples, we pick one and they get recognised and an award is broadcasted around the company, and our senior vice president that supports speaks of it in his quarterly update to the team.
(35:05) But the other interesting thing we do is that we has a leadership team look at these five things and say, which ones are really good that we want to adopt and use everywhere, and we can it to ourselves that there is something and we are now going to take that and use it across our entire business, and that then goes into our management system so that we keep tracking how we are doing better and better.
(35:25) I’ll give you an example, the very first one this year the woman who runs our social business was recognised for her work at creating social marketing capabilities within the regions of the world by stimulating a population of subject matter experts to participate in social marketing. Not from headquarters, not from the labs, but actually in our field organisation. And that is something that she did in one part of our business.
(35:53) We loved it so much, gave her an award, and decided we are going to do that in all of our businesses, and now we track that monthly in our management system. So I hope that gives you a perspective of the velocity here anyway which is innovation that I think has to come from the people doing the work, and it has to be surfaced up in a methodical way. Evaluate it, good ideas selected and implemented everywhere.
Vala:
(36:18) Last week we had on our show, David Cohen who is the CEO founder of Techstars, and a accelerator mentor based organisation, and they have about $300 million annual portfolio that they manage.
So at one point he talked about working with companies like Nike, Qualcomm, Microsoft, where they had essentially Techstar mentors in the same framework as an accelerator and working inside a big corporations to fuel innovation and really accelerate technology roadmaps. Do you in your organisation work with start-ups and if so can you talk a little bit about it.
Doug:
(36:58) Yeah, a good question. I would say that IBM works a lot with start-ups, not so much the organisation that I have or that I represent, but certainly in cloud we do. We have an entire ecosystem development organisation in our cloud business that works directly with start-ups on their adoption of new ideas, their use of technologies, like Bluemix to build new applications.
(37:21) So we’re definitely connected as a company, as a big company of $93 billion and 400,000 employees, we are definitely connected to start-ups. That’s kind of having an influence on us by the way and we are obviously trying in the way that we‘re changing and transforming ourselves to bring this start-up in motion in a sense of speed and ownership into our own teams.
(37:46) But what we’re doing is in the business that I represent, the systems business, because we’re in everything from chip design all the way through to software that manages content on websites.
(37:57) So we’re teaming up with other technology companies to share technologies like our power tip technology. We have created an open power foundation, we are working with Google and Facebook and others to share the intellectual property on our chip design and now we have over 135 other entities sharing the intellectual property of our power chip design together, and that’s kind of where we’re seeing innovation happened. It’s opening up our technologies to other companies.
(38:31) We’re seeing firms in China building servers based on our technology, that’s for my part of the company, that our sense of innovation working with other companies in open standards.
Michael:
(38:45) Doug, when you talk about openness you said just now that IBM is opening itself up. And when you were talking about marketing and empathy earlier, that’s another type of opening up, which is opening up to the customer and understanding the customer better. And what about this theme of opening up and connectedness with respect to digital transformation and digital marketing and so forth.
Doug:
(39:13) Yeah, I mean it’s essential, and I’ll tell you and maybe this is where you’re going and maybe not, but something struck me as an example of another company I see really connecting well with their buyers is Docker. I saw a presentation from somebody from Docker last year that was extremely impressive at the way in which they connect with a community of users and nurture that community of users.
(39:41) I put that in the whole category of being open to connect with people at the level of usage of the product, and stimulating people that abdicate for the experiences that they have around their product. I think that’s pretty exciting, so kudos goes to Docker in their growth in that regard.
Michael:
(39:58) Yeah, there’s a lot of activity and they are getting a lot of very positive press as well for them.
Doug:
(40:06) Yeah, and I think for companies like IBM that are large and have been at this for a while, these are the kind of examples of being open and we have to be open to learn from rather than just trying to innovate within our own ranks is looking at not only be Dockers of the world, but looking at other companies and other industries is at the same time. So yeah, it’s a pretty exciting time to be in marketing to learn from different places and different people and create change and do things differently.
Vala:
(40:37) Doug, I’m in the B2B space and my target customers are CIOs and there is a definite distinction between a innovative digital savvy CIO, and what I would call a legacy CIO, and they have different buyer journeys that they go through and they read different material and content, and they socialize and participate in communities differently. What advice do you have over all to CIOs overall, and then perhaps advice to CIOs that are finding it a bit more difficult to adapt to some of the technology trends that we’ve talked about, social, cloud, analytics, apps and so on and so forth.
Doug:
(41:19) That’s a kind of a hard one, because if the bottom of your question on that second group is a hesitancy to understand or at least to experience what’s happening in the market around digital transformation.
(41:33) If you’re not into that yet or you don’t see it coming, we’ve got to show people that it is coming and show examples that it’s coming and be ready.
(41:41) I think the biggest thing for CIOs though at the moment is that they do know that there will be needs that they enterprise is going to put on them to respond with speed and innovate new ideas. Whether it’s his new systems of engagement, through mobile. Whether it’s taking advantage of wearable devices, whatever the heck that may tell us in the future, whether it is use of analytics applications differently. Whether it’s still delivering quality service over multiple infrastructures, through cloud.
(42:10) Relationships, even although you don’t own the infrastructure you’ve got to deliver the service. These are all questions that have to be and said, and I think the CIO of the day has got to be thinking about how the right engineer my infrastructure for the future so I can do all of those things, even although I don’t know exactly what that is going to mean two years from now, three years from now. So this is the agenda I think CIOs need to get on is to think about their infrastructure differently based on the shifts that are happening around them.
Michael:
(42:43) Speed, innovation, responsiveness to users, that’s the new CIO agenda
Doug:
(42:48) I think so, yep and preparedness.
Vala:
(42:53) What about CMO’s? You just mentioned, speed, innovation, responsive to users, it seems like that’s pretty much any executive mandate, no?
Doug:
(43:04) Well it’s certainly would apply to CMO’s as well of course, although I think there is a major change agenda around CMO’s may be slightly differently because it’s not sold technology-based, it’s more behavioral based and content creation based. But I think we are all on a change agenda, no question about it.
Michael:
(43:29) We are just about out of time. You gave advice to CIOs, any final words of advice to CMO’s?
Doug:
(43:40) I think for CMO’s we talked a lot around this the last 40 so minutes, but the degree to which CMO’s attach themselves to the revenue agenda of the enterprise is our dimension that can differentiate from was all going forward. There seems to me to be an opportunity, not just to do marketing well, but to drive the financial results of an enterprise at the same time.
(44:08) What we are trying to do in our business is use metrics to track a direct contribution to revenue, far more closely than ever before so that we can articulate the value of marketing up the line like we have not in the past, And even better than before, so that would be my next step and hopefully for everyone.
Michael:
(44:30) Track direct revenue contribution to the bottom line.
Doug:
(44:32) Can’t beat it
Michael:
(44:36) I was going to say, so the days of, well we have a marketing budget and it works, and 10% of it is effective and the problem is that we don’t know which 10%. Those days are over.
Doug:
(44:49) Yeah, or the days of the head of marketing budget, we ran budget events and felt pretty good about the events, and the customers balked away happy, but okay where is the revenue, and I think the more we can plumb, here’s the revenue, because we know exactly back to the digital data marketing people and we know exactly how the revenue occurred, now we are starting to get to the science that we need to be at.
Vala:
(45:15) That absolutely critical advice and I hope that the folks watching the show, especially marketers rewind this last one minute and play it over and over and over again until they fully understand it and embrace it. Doug thank you very much that was sage advice.
Doug:
(45:31) All right Vala, thank you.
Michael:
(45:32) Well, this has been one super super-fast 45 minutes. I was going to say thank you. We’ve been talking with Doug Brown, who is the CMO of the $20 billion IBM group called IBM Systems. Doug, thank you so much for taking the time today.
Doug:
(45:56) Thanks Michael, my pleasure.
Michael:
(45:59) I’m Michael Krigsman, my co-host is Vala Afshar. Vala, this has been pretty amazing.
Vala:
(46:06) I can’t wait to summarize this show, dog has dropped a lot of marketing and IT science on us and I really appreciate it, thank you so much.
Michael:
(46:17) Everybody I hope you have a great week ahead and we look forward to seeing you again next week on CXO-Talk. Thank you so much, bye bye.
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