IBM focuses on Chiang Mai
Offices in Khon Kaen and the south planned
CHIANG MAI : Big Blue is looking at expanding its footprint into smaller cities to continue growing its business and has focused on Chiang Mai as a first step in Thailand, with offices in Khon Kaen and the south planned to follow.
Speaking to journalists on a press tour, Tim Wong, IBM Asean vice-president for general business, explained how IBM had reorganised itself into two business units last year; one for mature markets (North America, Western Europe and Japan) and the emerging markets which is where its growth aspirations are for the rest of the world.
In Q2 of this year, business in growth markets for the first time exceeded the size of business in Europe, with double-digit growth expected in each country as a matter of course.
Of the growth markets, IBM has identified 20 priority countries, of which Thailand is one. Wong noted that 17 of the world's 20 largest cities were in the priority countries, with only New York, Tokyo and London not on the list.
IBM has been in the Asean region for over 70 years. Together, Asean represents 560 million people and 50 percent of the addressable IT opportunity are in the capital cities. But this also means that 50 percent of opportunity is outside the capitals. Wong said that IBM will be growing its network of light branches and satellite branches through Asean from 13 branches today to 25 by 2015, or five branches per year.
IBM held its inaugural geo expansion academy in Chiang Mai to help IBM employees and partners understand the new focus and changes. It has also launched a Chiang Mai portal for specific news and opportunities for the North of Thailand.
Asked if this move upcountry would mean IBM taking business away from its own partners, Wong said that IBM has the largest set of partners throughout the world.
Most clients do not have complex business requirements and their needs will be met by local resellers and partners who provide point solutions. Only rarely on some occasions will IBM need to provide services itself to larger clients and even then, it will most likely be a complementary relationship with local systems integrators.
IBM is actually putting up incentives for its larger SI partners to invest in regions which IBM has targeted with co-marketing programmes and demonstration of proof of concept capabilities to help grow the market.
He said that in mature markets, around 70 percent of IBM's revenue would be from services and the rest from hardware and software. In this region, the mix is closer to 50:50.
Wiboon Thanandornsuk, territory manager for Chiang Mai, said that the region shows huge potential in terms of academic projects with seven or eight major research universities. IBM is working with Chiang Mai, Lamphun and North Chiang Mai universities in designing and updating curricula so that graduates can enter the job market without the need for retraining.
Another focus is teaching businesses about modern IT. One such seminar was conducted in Lamphun industrial estate alongside VMWare to show them the benefits of virtualisation.
This year, IBM Chiang Mai will focus on education, healthcare and manufacturing before expanding to hospitality and retail later.
IBM has been invited to be a member of the Chiang Mai Creative Committee, which is a task force aimed at helping Chiang Mai diversify away from its dependence on tourism. Much of the focus is on becoming a regional medical hub and on digital media.