A couple of weeks ago IBM announced its 4th Quarter and Full-Year 2009 results. Their Growth Markets Business Unit which includes 140 of the 170 countries that IBM operates in – grew 14% in Q4 compared to 3% decreases in the Americas. For the quarter, Growth Markets represented 20% of IBM’s revenue. For the year, Growth Markets were 19%, up just slightly from 18% of total IBM revenue in 2008. The signs are clear: Growth Markets are growing, even as other markets fell. Much of the success in Growth Markets has come from “Smarter Planet” solutions which are gaining traction among governments, utilities and private sectors.
NOTE: IBM’s growth markets are those that show increased potential for them. They do not equate to emerging markets according to the financial world’s and economic discipline’s definition. But, there is much overlap.
As I have been thinking about the role of “smarter computing” in emerging markets, and the opportunity to “do it right the first time,” several of IBM’s recent wins resonated with me. Increased urbanization across China for example – and last year’s Chinese Government stimulus package – has spurred infrastructure development. While much has been written about the resulting real estate bubble in China, there are other long-term infrastructure investments that will contribute not only to continued GDP growth but also to long term productivity and economic development.
“Smarter cities” that embed intelligence and data analytics across transportation systems, resource management, electricity grids, public health and safety and other municipal initiatives can help local governments to leap frog the traffic congestion, blackouts, crime waves, epidemics and other afflictions that have plagued urban areas throughout history. These initiatives will also encourage civic engagement by providing channels for government officials to encourage and capture public opinion, enabling citizens to provide feedback on and potentially input into government initiatives.
Here are a few IBM Smarter Cities wins from China that are worth highlighting:
China: Kunshan Municipal Government
The Kunshan Municipal Government, CVIC Software and IBM announced a co-operation in Kunshan City, Jiangsu Province. The three parties will jointly set up the smart city strategy solution development center, laboratory and service center in Kunshan Software Park. The solutions will support the implementation of the Smart City solutions covering the areas of e-government, food management, water resources management, smart transportation, public sanitation and health management and city security areas.
China: Shenyang Government
The Shenyang government and IBM have embarked on a major collaboration project in an effort to help the Shenyang city fulfill its vision as an eco-city in China. The collaboration will see investment of RMB $300 million from the Shenyang Government, and will lead to the set up of an IBM Collaboratory in China. It covers areas of eco-city planning, water quality management and pollution control, carbon emission reduction, food safety as well as intelligence and public opinion collection and analysis for city development and environmental protection. Chosen by China’s State Council to be the model city for environment protection and development, Shenyang is committed to fulfilling its environmental responsibility goals. Shenyang, with a population of over 7.5 million, is the capital city of Liaoning province in Northeast China and an important industrial center in China. In the 1980’s, Shenyang was identified by the World Health Organization (WHO) as one of the 10 most polluted cities in the world.
China: ENN Group
IBM and ENN Group, an energy provider in China, entered into a strategic agreement where the two companies will work together to provide Intelligent Energy solutions for building smart eco-cities in China. The extensive collaboration includes strategic investment by IBM in ENN’s energy services business, joint development of “Intelligent Energy” solutions and combined efforts to build the industry expertise and skills to serve the energy market in China. In addition, IBM will provide Information Technology infrastructure management and services, as well as application management and maintenance services to ENN. As part of the multi-year agreement, which is also IBM’s largest contract sealed in China in the last 10 years, IBM will leverage its deep expertise in consulting services and enterprise transformation to help ENN reengineer its processes across the company’s core business areas, including corporate strategy, business development and marketing, accounting and financial management, project management and service delivery.
Wouldn’t we all like the opportunity to get it right the first time? Or at least the opportunity to do it again?