Software Group Rational Module 3 Identifying Opportunities and

Software Group Rational - Module 3 Identifying Opportunities and Managing the Sale Software Top Gun – Sao Paulo Roger Snook © 2005 IBM Corporation

Software Group Module 3 Objectives Identifying Opportunities § At the conclusion of this module, attendees should be able to – Use a consistent framework to have discussions about Rational solutions – Pose questions to uncover opportunities – Recognize the best cross-brand selling opportunities for Rational – Understand the strategies to increase deal size – Find key resources and tools 2 © 2006 IBM Corporation

Software Group A framework for customer discussions Future cost avoidance § Investing now to receive future savings, capacity, responsiveness Price of entry Basic cost efficiency Operational risk avoidance § Investing now to avoid future business/IT risks, e. g. , security, privacy, continuity… Business impact § Investing now to affect future top line So our focus in Rational: 1. Getting the basics under control 2. Practical approaches to transformation 3 © 2006 IBM Corporation

Software Group Entry points to greater value Value § Address development as a value creation center Control § Address the risks of development Efficiency § Address development as a cost center - Productivity - SE base Quality - Global Communication 4 - Perceived Quality - Time to market - Security application failure/hack - Failing an audit - Privacy exposures - Foster innovation and reuse across organizational and geographical boundaries - Enterprise application modernization - Speed merger and acquisition absorption - Reduce traditional development in favor of smart package software integration and SOA © 2006 IBM Corporation

Software Group Identifying Rational Opportunities – Let’s Practice! Getting the “lay of the land” International Bank is one of your largest customers. They are a diverse company with several Lines of Business. They already use IBM middleware solutions such as Web. Sphere Application Server and Tivoli storage products. As far as you know, they don’t own any Rational products. You have your quarterly meeting with a Sr. IT Manager in two weeks to discuss their priorities for the coming year. What “situation” (fact finding) questions should you ask? § Do any of your initiatives include building new software systems, deploying packaged applications, or updating/re-architecting existing software systems? § How many software developers do you have and where are they located? § What vendor’s tools do you use today for software development projects? § Do you have a standard, enforced process used for all your development projects? § What types of services/software/systems are you deploying? (Java, . NET, COTS, Realtime, etc. ) § What platforms do you deploy software on (Windows, Linux, System z, System i, etc. )? 5 © 2006 IBM Corporation

Software Group Identifying Rational Opportunities – Let’s Practice! Uncovering customer problems International Bank is one of your largest customers. They are a diverse company with several Lines of Business. They already use IBM middleware solutions such as Web. Sphere Application Server and Tivoli storage products. As far as you know, they don’t own any Rational products. You have your quarterly meeting with a Sr. IT Manager in two weeks to discuss their priorities for the coming year. What “problem” questions should you ask? § How effective are you in delivering software on time, on budget and with high quality? § How well does your application architectures promote reuse of common services? § How easily can you collaborate on projects with distributed teams? (including employees, business partners, offshore providers and customers) § How would you rate your development organization’s ability to efficiently meet external regulatory requirements and internal standards? § How effective are you in selecting which new product features will have the greatest return and market impact? § What are you doing to ensure your web applications are not vulnerable to hackers? 6 © 2006 IBM Corporation

Software Group Identifying Rational Opportunities – Let’s Practice! Exploring the impact of problems International Bank is one of your largest customers. They are a diverse company with several Lines of Business. They already use IBM middleware solutions such as Web. Sphere Application Server and Tivoli storage products. As far as you know, they don’t own any Rational products. You have your quarterly meeting with a Sr. IT Manager in two weeks to discuss their priorities for the coming year. What “impact” questions can you ask? § § § How is lack of development efficiency impacting costs or time to market? What’s the impact of having inflexible software architectures? How are your legacy (green screen systems) affecting productivity? How effective are you in monitoring the ROI of outsourced development projects? What’s the risk to your business if you don’t have a solid process to ensure you are meeting regulatory requirements? § What are the risks to your company If hackers get in through your web applications? 7 © 2006 IBM Corporation

Software Group Having ROI Conversations with Customers Example of saving TIME and MONEY § One web project team of 10 (developers, testers and project manager) § Before: Daily (M-F) bug meeting: 1 hour * 10 people * 5 days = 50 hours – Discuss bug status, reassign / redistribute workload… – Reprioritize issues, assign new issues… § After Rational: Weekly (Tues) bug meeting: 1 hour * 10 people = 10 hours 150% ROI 8 © 2006 IBM Corporation

Software Group Quick OI Exercise § If your job is to sell…. think about your customers that do not have Rational solutions today…. § Let’s take 5 MINUTES for an OI exercise to begin the process of uncovering potential opportunities Global Development & Delivery Risk & Compliance Management Enterprise Modernization SOA Governance & Lifecycle Management Systems Development Control User Comm I-faces OEM Power Body system Chassis 9 © 2006 IBM Corporation

Software Group Best cross-brand plays for Rational Other Brand Rational Products Why? Tivoli Composite Application Manager (ITCAM for *) Rational Performance Tester Rational Application Developer ITCAM captures production performance data and delivers to the developer (RAD) and testing (RPT) tools – faster turn-around for fixing performance bottlenecks and reducing system downtime Tivoli Provisioning Manager (TPM) Rational Change and Release Management Solutions Provides integrated, auditable solution to quickly provision software updates to production. Eliminates manual errors that lead to roll-backs Rational App. Scan For a complete solution, customers must address web, application, network and desktop security Rational Architecture Management Solutions Rational solutions are tuned to lower the cost and speed the development & deployment of new software systems and services to WAS and Portal Rational Performance Tester Rational Appscan Use RPT to “test and tune” portals for maximum performance, a critical Portal best practice Ensure security of WAS & Portal deployed applications Rational Asset Manager Together they provide a complete, integrated, asset management solution – from development through operations Rational App. Scan Offers complete solution – covering web, application, network, desktop and server security Tivoli Security Solutions WAS or Portal Web. Sphere Service Registry and Repository ISS Proventia Server and Network Security 10 © 2006 IBM Corporation

Software Group Module 3 Objectives Identifying Opportunities § At the conclusion of this module, attendees should be able to – Use a consistent framework to have discussions about Rational solutions – Pose questions to uncover opportunities – Recognize the best cross-brand selling opportunities for Rational – Understand the strategies to increase deal size – Find key resources and tools 11 © 2006 IBM Corporation

Software Group Common purchasing patterns/deal types § Large Enterprise tool consolidation deals Enterprise deals ($1 -15 M) – “We need an integrated, standardized process and development platform across our entire organization” – Large number of development staff (1000’s) standardizing on Rational solutions across entire organization Mid-size solution opportunities ($200 K - $1. 5 M) Inc rea sin g. D ea l. S ize § Mid-size solution opportunities Transactional point product opportunities – “We need to automate our build process across all our development projects” – “We need to improve our complete software development process on XYZ project” – Focused on addressing a few inefficiencies in the software development lifecycle or a single project lifecycle opportunity § Point product sales – “We need a tool to track requirements” – Focused on solving a specific problem in their software development process Relative number of deals 12 © 2006 IBM Corporation

Software Group Increasing your deal size Mid-size solution opportunities ($200 K - $1. 5 M) With the right strategy, all deal sizes can grow Inc rea sin g. D ea l. S ize Enterprise deals ($1 -15 M) Transactional point product opportunities Relative number of deals 13 © 2006 IBM Corporation

Software Group Example 1 - Anatomy of a $16. 4 M deal – Large Insurance Co. Example Sales Cycle, Milestones & Take-aways Step 1 $100 K for modeling solution IT LOB 1 Sell across IT & LOBs 14 LOB ‘n’ LOB 2 Project ‘a’ Developers Step 2 Software practices assessment Main contact Test project Sr. Mgr sponsors Develop multiple champions $10. 7 M licenses $1. 7 M Services full SDP for 5000 employees Project ‘c’ Tripled opp size by introducing solution to mainframe developers System z shop Project ‘b’ Step 3 RFPs & delivered custom demo Step 6 Step 4 $4 M for developer solutions Capitalize on incremental successes Step 5 POC for full Rational SDP Don’t forget mainframe developers! © 2006 IBM Corporation

Software Group Example 1 - Anatomy of a $16. 4 M deal – Large Insurance Co. Keys to Success Teamwork Client Exec/CSSR: account management, procurement relationship, opening doors. . CITA/IGS: introduced sales team to key players, key stakeholder Strategy Kept focus on value of single vendor, integrated solution to box out point product competitors Consistent messages from all IBM team members 15 Rational Team: built customer champions, managed RFPs, demos, POC’s etc. IBM Executives: shared product roadmap and met commitments Win Factors Superior lifecycle solution Customer confidence in IBM’s ability to implement solution Existing IBM / client relationship © 2006 IBM Corporation

Software Group Example 2 – Turning a negative into a positive § Situation: – 2006 ELA with large India-based SI included $400 K of Rational tools. – During a meeting to discuss 2007 ELA, customer unhappy with tools adoption rate (<30%) § Turn-around Strategy: – Selected 10 key projects to mentor employees on use of Rational tools – Performed Po. C on each Rational tool and integrated into customer’s internal development process – Shared Rational’s strategy/vision with Sr. Executives – Leveraged Rational Software Developers Conference to have Sr. Rational Executives meet with customer – As 2007 ELA approached, focused on business results achieved in 10 key projects – Seeded ELA with strategic tools that will keep competitor’s out and continue building demand throughout 2008. Watchfire Security, Build Forge, Systems Development Solution, etc. 16 $6. 4 M Deal part of new ELA © 2006 IBM Corporation

Software Group Lessons Learned from Losses 17 Services/Training can be a difference maker Be concerned if your internal champion can’t explain why software development matters to their business Explaining the full Rational “vision” of an integrated software development platform is important…. even if the customer isn’t ready to buy the entire platform Find the customer’s most painful problem and show them how to solve that FIRST Having the best/coolest technology is not enough to win a large deal – must tie software development improvements to business Practitioners (tool users) often have enough influence to exclude a vendor if you forget to address their needs/concerns © 2006 IBM Corporation

Software Group Key Rational Resources § Download for reference – One slide summary of complete Rational portfolio (Rational Rainbow chart) – 2 -page summary of Rational brand business value (internal) § Build your Pipeline – c. SSR Virtual Workshop – Industry-focused prospecting plays – Americas – NE IOT – SW IOT – AP – Leverage Acquisitions and New products – Rational Team Concert Sales Acceleration Play (Great for GB!) – Telelogic All-in-one XL page (links to education, sales plays, lead passing process and WYNTK documents) § Subscribe to stay informed – Rational Centerfield bi-monthly newsletter – Rational month marketing newsletter § Become an expert – (Technical) – Join a Co. P – (Sales) – Attend Rational Top Gun 18 © 2006 IBM Corporation

Software Group Learning Points – Module 3 § Asking Questions – Ask situation questions to understand facts that can help assess opportunity size, who owns the “problem space”, how much software development is done across their business, etc. – Ask problem questions to look for known or unknown problems and inefficiencies in software development that if addressed, could improve business results. – Ask impact questions to get the clarify the impact of problems and to get your customer thinking about the value to the business of improving software development § Common purchasing patterns – Rational deals are common in both GB (37%) and I/A accounts – GB opportunities or small deals in I/A often focus on solving problems in specific areas of the software development lifecycle – Goal is to drive cross-enterprise deals (true for both I/A and GB accounts) § Maximize deal size by: – Look for opportunities in LOBs, across-LOBs and in IT – Focus on business value of tool standardization (lower maintenance costs, lower training costs, minimized “re-training” costs) – Including system i and z developers in opportunities 19 © 2006 IBM Corporation