Borman In Hot Seat

Borman, who declined to comment, received his new marching orders just last Tuesday, but partners say he needs to get cracking soon on many fronts.

One of the biggest problems, partners say, is that the group's aggressive partner recruitment program has led to VARs increasingly facing off in contested accounts, putting pressure on margins.

Mike Fischer, vice president of enterprise software and services at MSI Systems Integrators, an Omaha, Neb.-based IBM Premier business partner, said he hopes Borman will quickly implement an account registration program for software partners that apes a similar program already in place for IBM hardware partners.

"We are having to forgo our profitability because some partner comes in at the last minute who is not adding value but is willing to discount aggressively," he said. Aside from partner vs. partner angst, some report that IBM's partner-friendly mantra has not trickled down to all its salespeople.

Another issue is that IBM, like all tech players, has to continually prove that its offerings solve real problems. "People won't buy more than what they need, and they won't throw [existing] stuff out," said Robert DeMaio, president and CEO of Relavis, a Lotus and IBM ISV in New York. "They don't even want to pay for things if they don't use them all the time."

Amy Wohl, president of Wohl Associates, an IBM watcher in Narberth, Pa., said Borman's "biggest challenge is doing better than the predicted average for enterprise software sales next year. Everyone says growth will be just a few points above last year, and that won't satisfy IBM."

While IBM wants to entrench more of its software stack in any given account, customers are unlikely to discard rival infrastructure that works. Partners say that while IBM has customers for its Lotus, WebSphere and Tivoli brands, most of them use just one or two products. There aren't many companies that use Domino groupware, Tivoli systems management and WebSphere application servers together, for example.

It does not help that these products, resulting from acquisitions, overlap. Lotus caused a stir when it said it would replace the venerable Notes Storage Facility (NSF) with a DB2-based relational store and swap out native Domino capabilities for J2EE functions. That statement blurred the line between WebSphere and Domino, and company executives have spent much of the past two years trying to clear up the confusion.

Some partners, who readily acknowledge that WebSphere Application Server is a world-beater, blast the WebSphere portfolio as chaotic. They say the WebSphere family is a hundred piece parts in search of rationality.