IBM split won't impact Indian operations, says CEO Arvind Krishna

 As IBM splits into two companies globally, separating the heritage IT infrastructure-managed services business from the futuristic hybrid cloud and AI piece, Arvind Krishna, Indian-born chief executive officer (CEO) of the technology major, has said the split will have “no material impact” on its Indian operations and structure while it unlocks enough potential in the country in both the spaces.

The separation, he said, would come into force in the second quarter of 2021, creating two companies globally as well as in India with different heads.

“We will have two entities in India but it will take a year to play out. I expect most people to find a place in one or the other (company),” said Krishna, who succeeded Ginni Rometty as CEO in January this year.

“We have not done the full employee split but close to 100 per cent of our clients get touched by our infrastructure-managed services employees. Maybe about one-third to one-fourth of our India employees will be part of the new company.”

Unlike many global technology companies, IBM is uniquely positioned in India, which is not only a large market for the Big Blue but also houses a big chunk of its global employee base.

Over 33 per cent of IBM’s global workforce of around 380,000 are estimated to be located out of India. The technology major, which reported revenues of Rs 26,542 crore from the Indian market in FY19, counts several large banks including the State Bank of India (SBI) and Bank of Baroda, and telcos such as Bharti Airtel and Vodafone among its clients.

chart

Krishna said the company saw huge opportunities in the hybrid cloud space, where the company is uniquely positioned as compared with Microsoft and AWS.

Two of the largest telecom operators in the country, including Airtel and Vodafone, he said, are using its platform while SBI has partnered it for the cloud transformation of its banking app Yono.

“People have to work in an environment that involves both public and private clouds, and we believe that we have the best answer (for that) that is based on open technology. It allows you to run (your data) anywhere and when you run across multiple environments,” said Krishna, who graduated from IIT-Kanpur and has a PhD from University of Illinois. He has been with IBM since 1990.

The CEO said he expected the firm’s India footprint to grow stronger both in its services as well as software and R&D business.

“As our business expands in services, there will be opportunities for employment, promotions, skills, and interactions with university and all of that.”

With the separation of two businesses, IBM expects the hybrid cloud and AI-focused company would target $1 trillion while managed infrastructure will also continue to grow with a $500 billion market opportunity.

IBM, govt e-marketplace to set up centre of excellence for AI in India

 IT company IBM will set up a centre of excellence for artificial intelligence (AI) in India in partnership with Government e-Marketplace, a top official of the firm said.

"I am happy to announce we are creating an AI centre of excellence in partnership with Government e-marketplace (GeM). Our goal is to apply the power of AI to improve usability and transparency and drive efficiency in cost saving in public procurement, " IBM CEO Arvind Krishna said at RAISE 2020 summit.

AI has the potential to raise India's annual growth rate by 1.3 percentage points and add $957 billion to India's economy by 2035, as per the studies done by Accenture.

According to official data, more than 38,700 stakeholders from academia, the research industry and government representatives from 125 countries have registered to participate in RAISE 2020.

The National Strategy for Artificial Intelligence (NSAI) highlighted the potential of AI in boosting India's annual growth rate by 1.3 percentage points by 2035 and identified priority sectors for the deployment of AI with government's support.

New IBM CEO Arvind Krishna described as 'brilliant, right person to lead'

Indian-origin technology executive Arvind Krishna has been elected Chief Executive Officer of American IT giantM IBM after a "world-class succession process", succeeding Virginia Rometty, who described him as the right CEO for the next era at IBM and well-positioned" to lead the company into the cloud and cognitive era.

The IBM Board of Directors elected Krishna as company CEO and member of the Board of Directors effective April 6. Krishna is currently IBM Senior Vice President for Cloud and Cognitive Software and will succeed Rometty, 62 who will retire after almost 40 years with the company at the end of the year.

Krishna, 57, had joined IBM in 1990 and has an undergraduate degree from the Indian Institute of Technology, Kanpur, and a PhD in electrical engineering from the University of Illinois at Urbana-Champaign.

I am thrilled and humbled to be elected as the next Chief Executive Officer of IBM, and appreciate the confidence that Ginni and the Board have placed in me," Krishna said in a press statement released by IBM.

Krishna said IBM has such talented people and technology that we can bring together to help our clients solve their toughest problems.

I am looking forward to working with IBMers, Red Hatters and clients around the world at this unique time of fast-paced change in the IT industry. We have great opportunities ahead to help our clients advance the transformation of their business while also remaining the global leader in the trusted stewardship of technology," Krishna said.

Krishna's appointment as head of the global IT giant adds to the growing list of Indian-origin executives at the helm of some of the biggest multinational companies. Krishna joins the club that includes Microsoft CEO Satya Nadella, Google and Alphabet CEO Sundar Pichai, MasterCard CEO Ajay Banga, PepsiCo's former CEO Indra Nooyi and Adobe CEO Shantanu Narayen.

Rometty, who had been IBM's Chairman, President and CEO, will continue as Executive Chairman of the Board and serve through the end of the year, when she will retire. She described Krishna as the right CEO for the next era at IBM who is well-positioned to lead IBM and its clients into the cloud and cognitive era."

Rometty said Krishna is a brilliant technologist who has played a significant role in developing our key technologies such as artificial intelligence, cloud, quantum computing and blockchain. He is also a superb operational leader, able to win today while building the business of tomorrow.

She said Krishna has grown IBM's Cloud and Cognitive Software business and led the largest acquisition in the company's history. Krishna was a principal architect" of the company's acquisition of Red Hat.

Through his multiple experiences running businesses in IBM, Arvind has built an outstanding track record of bold transformations and proven business results, and is an authentic, values-driven leader.

The IBM Board also elected James Whitehurst, IBM Senior Vice President and CEO of Red Hat, as IBM President.

Rometty added that in both Krishna and Whitehurst, the Board has elected a proven technical and business-savvy leadership team.

Lead Director of the IBM Board of Directors Michael Eskew said with the strong foundation now established by Rometty for IBM's future, the Board is confident that Krishna is the "right CEO to lead IBM.

The Board ran a world-class succession process and found in Arvind a leader with the business acumen, operational skills, and technology vision needed to guide IBM in this fast-moving industry," Eskew said.

Chairman of the Board's Executive Compensation and Management Resources Committee Alex Gorsky said Krishna thinks and executes squarely at the intersection of business and technology. Gorsky said he is an ideal leader to succeed Rometty and take IBM and its clients into the next chapter of the cloud and cognitive era.

The IBM statement said that as IBM Senior Vice President for Cloud and Cognitive Software, Krishna led the IBM business unit that provides the cloud and data platform on which IBM's clients build the future.

His current responsibilities also included the IBM Cloud, IBM Security and Cognitive Applications business, and IBM Research. He leads the unit's strategy, product design, offering development, marketing, sales and service and also guides IBM's overall strategy in core and emerging technologies including artificial intelligence, quantum computing, blockchain, cloud platform services, data-driven solutions, and nanotechnology, according to his profile on the IBM website.

Previously, he was general manager of IBM Systems and Technology Group's development and manufacturing organisation, responsible for developing and engineering advanced semiconductor materials through microprocessors, servers, and storage systems. Prior to that, Arvind was general manager of IBM Information Management, which included database, information integration, and big data software solutions. He served as vice president of strategy for IBM Software. He also held several key technical roles in IBM Software and IBM Research, where he pioneered IBM's security software business.

According to his profile on the IBM website, Krishna is the recipient of distinguished alumni awards from IITK and the University of Illinois, is the co-author of 15 patents, has been the editor of IEEE and ACM journals, and has published extensively in technical conferences and journals.

IBM appoints Sandip Patel as MD of its India and South Asia operations

IBM on Wednesday said it has appointed Sandip Patel as managing director of its India and South Asia (ISA) operations.

He succeeds Karan Bajwa, who is quitting the company to pursue opportunities outside of IBM, the company said in a statement.

In his role, Patel will be responsible for all strategic and operational matters related to IBM's sales, marketing, services and delivery operations in the region, including Bangladesh, Nepal and Sri Lanka.

"Additionally, he will play a critical role in enabling India's capabilities across IBM's global missions, global centres of excellence, research and innovation labs," the company said.

Most recently, Patel was based in Boston, Massachusetts, where he was IBM's global general manager for the Insurance industry and was responsible for the company's business across all brands in this market segment.

His extensive expertise in key industries, including financial services, insurance and healthcare, coupled with his global leadership experience will bring great value to IBM's clients and business in the region, it added.

"IBM has been a key player in India's technology journey and continues to provide the innovation necessary to power India's digital transformation across key industries and government," Harriet Green, Chairman and CEO of IBM Asia Pacific, said.

Patel's deep industry expertise and global understanding of clients across different markets will bring real value to our clients as they embark on their transformation journey, he added.

Patel has also worked with Aetna international, PriceWaterhouse Coopers and Coopers & Lybrand.

IBM laying off 2,000 employees not performing 'at a competitive level'

International Business Machines Corp. is laying off about 2,000 employees this week, according to news reports, as the company reshapes its business.

The move amounts to less than 1% of if its workforce, which totaled 350,600 at the end of last year.

IBM confirmed that a “small percentage of employees” who are not performing “at a competitive level” would be leaving the company. “We are continuing to re-position our team to align with our focus on the high value segments of the IT market – while aggressively hiring in critical new areas that deliver value for our clients and IBM," the company said in a statement.

The Wall Street Journal and CNBC earlier reported on the job cuts.

In 2016, the Armonk, New York-based company, started to cut jobs in the US as part of a strategy to shift its workforce toward cloud computing and artificial intelligence operations. It made additional reductions in 2017.

IBM has lagged behind the overall technology sector for years, with its 1% revenue growth in 2018 breaking a six-year run of declining sales. In the past, the tech giant has laid off staff in slower businesses in order to beef up resources in new areas. IBM has about 25,000 open job positions worldwide.