IBM, SAS Strategic Alliance to Target Financial Services and Telecommunications

Industry leaders to deliver integrated analytical CRM soluti

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August 14, 2001, San Francisco . . - 14 Aug 2001: IBM and SAS Institute, the leaders in business intelligence solutions, today announced a new strategic alliance that will deliver comprehensive solutions for analytical customer relationship management (CRM) to customers in specific industries, starting with financial services and telecommunications.

The new alliance, which elevates SAS to the highest level in IBM's partner program, was announced at Solutions: The IBM Technical Developer Conference, IBM's annual developer conference and its largest gathering of software developers.

The two companies will enhance each other's offerings to customers and further integrate technologies to provide organizations in these targeted industries the most complete, reliable and effective solutions available today for building and maintaining lasting, profitable relationships with their customers. The alliance combines powerful SAS® analytical applications and data warehousing technology with IBM's strength in e-business infrastructure, technology, data management and services.

"The market for CRM applications software and services is expected to reach $68 billion in revenue this year and $162 billion by 2005," said industry analyst Bob Blumstein, research director for CRM analytics at IDC. "The IBM and SAS alliance announced today, with its potential for success in leveraging their overlapping customer bases in this huge market, shows the increasing importance of integrating CRM analytics to build a more powerful marketing process."

Financial Services
With enterprise marketing automation software and Web analytics from SAS and business intelligence services from IBM at its core, the new integrated solution for the financial services industry will enable banks, brokerages and other financial institutions to integrate customer information across all marketing channels and gain true customer intelligence. With this intelligence, these organizations can execute more effective marketing campaigns, deliver highly targeted and personalized messages, and detect and predict significant new sales opportunities. IBM's banking and finance industry sales force will promote the new solution, working closely with IBM Global Services.

The new integrated solution for the telecommunications industry will include SAS Telecom Churn Management and the business intelligence and industry domain expertise of IBM Global Services. The integrated products and services will help phone and wireless companies predict which customers are likely to leave so they can take early appropriate action to retain valuable clients. By gathering and warehousing huge volumes of customer data and applying predictive analytical models to this data, these companies can better understand their customers and anticipate their actions. IBM's telecommunications industry sales force will promote the new solution.

SAS will lead with IBM for hardware, middleware, services and financing for these new IBM and SAS financial and telecommunications CRM solutions. SAS and IBM will also develop marketing plans to jointly promote these solutions and share leads for customer opportunities in these industries.

The companies also will work together to integrate and optimize these new solutions with each other's technologies. For example, SAS and IBM will continue to work closely on the integration of SAS solutions and DB2 Universal Database* and IBM middleware including WebSphere MQ Series* and WebSphere* Application Server to further enhance performance on all IBM eServer platforms.

"IBM's alliance with SAS is the first to be sponsored by IBM Global Services, which highlights the true synergy between our two companies' technology and services. In this case, one plus one equals three for customers who will benefit from our combined and integrated offerings," said Mike Fuller, global vice president and practice executive for IBM Business Intelligence Consulting & Services. "With the huge volumes of customer data pouring in to organizations from multiple channels -- e-business and e-commerce applications, call centers, Web sites, etc. -- the challenge is to make sense of it all and truly understand customers and what motivates them.

"Combining mission-critical SAS CRM solutions with IBM's powerful family of eServers, IBM's successful DB2 Universal Database, and the business intelligence expertise of IBM Global Services consultants empowers organizations to transform customer data from any source into a single, comprehensive customer view that serves as the foundation for long-term, personalized, and profitable relationships."

The three-year agreement will initially focus on North America, though the deal has been structured to allow expansion into other geographical areas.

As part of the strategic alliance, IBM's sales force will promote SAS' solutions to their customers. Not only does this expand the breadth and depth of IBM's offerings in these specific industry areas, but it also will help SAS to achieve its goal of expanding new revenues from partners.

"Many organizations lack the expertise to support complex data mining, analytics and predictive tasks, essential for combating churn in the telecommunications industry, or in devising effective marketing campaigns in the banking and financial services industries," said Graeme Woodley, senior vice president for business development and channel operations at SAS.

"SAS and IBM have thousands of joint customers who have invested in IBM eServers and DB2 to run their operational systems, and rely on SAS solutions to derive intelligence from these systems. Together, IBM and SAS are delivering complete solutions that provide financial services and telecommunications firms with the knowledge to create faster, smarter and more profitable marketing campaigns, and to predict which customers are likely to leave and take early action to retain them. In today's challenging economic environment, leveraging customer data to achieve competitive advantage is more important than ever, and these new joint solutions do just that."

More than 4,100 companies and organizations at nearly 8,500 sites worldwide are using both SAS and IBM technology today. These companies represent all major industries, from financial services and telecommunications to energy, healthcare, retail and public sector, among others. Increased cooperation and tighter integration between SAS and IBM will benefit these existing joint customers and attract new ones.

A history of working together
Today's new strategic agreement is just the latest example of a long history of IBM and SAS striving to deliver better solutions that address customer needs. Since its founding in 1976, SAS has had a technology relationship with IBM. This relationship has expanded over the last 10 years through more formal partnerships -- including joint development and marketing -- primarily with IBM's eServer Group.

In January 2000, an agreement was made in which IBM Global Services assembled a cadre of SAS-trained professionals to promote joint SAS and IBM solutions in the CRM, supplier relationship management (SRM) and intelligent data warehousing areas. This relationship has been subsequently expanded to include financing options for customers through IBM Global Financing, and joint development and technology sharing between IBM Global Services' SurfAid Analytics and SAS advanced Web analytics offerings.

The two companies jointly operate the IBM and SAS International Competency Center, which provides customers and sales teams worldwide with assistance and resources for sizing, design and configuration, benchmark testing, and implementation of a host of SAS software solutions -- for data mining, data warehousing, and other business intelligence functions -- running on leading IBM server platforms and DB2. The center is located at SAS' world headquarters in Cary, N.C.

The SAS strategic alliance is another example of IBM's commitment to go to market with leading independent software vendors through the PartnerWorld for Developers program. Under this initiative, IBM has signed agreements with companies such as Siebel Systems, SAP and PeopleSoft. These alliances target industries such as financial services, retail and manufacturing and solution segments including enterprise resource planning, supply chain management, CRM and business intelligence. The goal is to provide developers with access to new customers and revenue opportunities through IBM's marketing, sales, and solutions resources. In return, developers commit to lead with IBM's middleware, server platforms and services.

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