Think 2019: IBM CEO Ginni Rometty on Chapter 2 of Digital Transformation

Ginni Rometty’s keynote is the high point of Think 2019. Here’s an abridged version of the IBM Chairman, President and CEO’s presentation that should provide you with some of the most important takeaways. You can also watch the entire keynote at the Think 2019 site. 

Chapter 2: The Next Stage of Innovation

Ginni began by situating at which stage of the digital journey most businesses find themselves in today. She noted how, after having experimented with AI and moved simple workloads to the cloud and committing to “random acts of digital,” businesses are now ready to move to Chapter 2.

Chapter 2 is about moving from experimentation to true transformation. It’s about gaining speed and scale. Three core areas are critical for businesses on the path to Chapter 2.

1. Digital and AI
2. Hybrid cloud
3. Responsible stewardship

Digital and AI

Chapter 2 of Digital and AI is about scaling and moving from experimentation to transformation. IBM is announcing Watson Anywhere, which gives businesses the ability to apply AI wherever their data lives.

During her keynote, Ginni shared valuable lessons businesses should heed as they move to Chapter 2. In particular, she noted how business are pursuing two distinct approaches to digital transformation: outside-in and inside-out. While an outside-in approach is largely “driven by the market and demand for new digital services,” an inside-out approach is about modernizing core systems and “architecting your business for change.”

Ginni went on to explain how “there can’t be AI without IA” (information architecture). This is because companies need a business platform to connect of all their digital services and manage the lifecycle of their AI apps.

To help businesses accelerate their move to Chapter 2, she revealed that IBM is making Watson available anywhere, on any cloud. This new offering, called WATSON ANYWHERE, is designed to help businesses deploy Watson AI wherever their data resides. Regardless of public, private or on-prem, or cloud vendor.

Ginni was joined on stage by Greg Kalinsky, EVP and CIO with Geico. Greg discussed how Geico is using IBM Watson to create a more personalized experience. According to him, the auto insurance is a tough industry because it’s about “selling you something that you are forced to have and hope you will never use.” Thus, a company like Geico has no choice but to differentiate itself through customer service and price. These largely depend on technology and Kalinsky described how relying on IBM Watson has helped the company with both.

Another guest speaker was Ted Chung, CEO, Hyundai Card. Ted discussed the digital transformation he is undertaking at Hyundai Card and how he is adopting and scaling AI solutions – via chatbots and in call centers – to improve customer service. AI transformation will impact everyone, Chung said. This means that “companies need to commit to change to succeed.”

Hybrid Cloud

Chapter 2 of the cloud is about moving core business applications across multiple clouds. IBM is announcing new capabilities designed to simplify and speed the journey to hybrid cloud.

Businesses today have completed the first 20% of their cloud journey, which was Chapter 1. Chapter 2 is about moving mission-critical apps (the other 80%) to the cloud. But as companies do this they have to take into account “unique needs around compliance, security or location,” Ginni said.

The result is a complex web of hybrid, multi-cloud environments. And, already, 94 percent of enterprises use multiple clouds. To pioneer their move to Chapter 2, businesses need the ability to move apps and data between clouds—efficiently and securely.

Last year, IBM launched Multi-cloud Manager, which gives businesses visibility and control across different clouds and vendors. In her keynote, Ginni Rometty unveiled a host of new cloud offerings designed to guarantee the fastest, most secure path to Hybrid Cloud.

The other important development that will allow IBM to help companies accelerate their journey to hybrid cloud is the fact that IBM is in the process of acquiring Red Hat. To discuss what this means for the industry, Jim Whitehurst, Red Hat’s CEO, was invited on stage. Jim provided his view of the technology landscape, the role that Red Hat plays now – and will play in the future – and described how a combined IBM + Red Hat will benefit clients, partners and developers.

Both Jim Whitehurst and Ginni Rometty agreed that IBM and Red Hat work on the “last mile of the enterprise.” Together, IBM and Red Hat will only not only continue to make open source consumable to enterprise, but also rely on industry expertise to help companies make sense of their data and put it to use.

Ginni was also joined by Bernard Tyson, Chairman and CEO of Kaiser Permanente and John Donovan, CEO, AT&T Communications. Tyson described his company’s effort to provide more affordable, higher quality care and a clearer focus on the individual. “Technology plays a big role in that effort,” he said.

Meanwhile, John Donovan discussed how AT&T is moving its enterprise applications to a micro-services model at scale and by taking an inside-out approach, collocating in agile centers and establishing joint AI garages to scale. He also commented on 5G and what this will mean for cloud and edge computing. “5G is a game-changer,” he said.

Responsible Stewardship

As in Chapter 1, Chapter 2 needs to be underpinned by responsible stewardship. It’s about conducting business with trust, transparency and purpose. 

Chapter 2 offers vast new opportunities—but it will take more than technology and more than business. Ginni emphasized that businesses must “do more than digitally reinvent themselves.” They need to act as responsible stewards and work to build new levels of trust.

This can be done by ensuring that clients’ data is secure, that clients retain control of their data and that they can trust AI technology and its recommendations. Ginni offered IBM’s own data and AI principles as an example and invited others to adopt them.

More broadly, she stressed the need to invest in equipping students and working professionals for a new generation of in-demand skills. To discuss this issue, IBM employees who have benefited from IBM’s new career pathway models shared their stories—from IBM’s Apprenticeship Program, to P-Tech, to the Tech Re-Entry Program, to the Veteran Employment Initiative.

Ginni ended her remarks with a major announcement that she hailed as a concrete example of how IBM is using technology for good.

Last year, IBM became a founding partner of Call for Code, a global call to action for developers to apply their skills to solutions for disaster preparedness and relief. This year, IBM is announcing Code and Response, a $25 million commitment that will invest in building, deploying and scaling the technologies developed in the Call for Code challenge.

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