European Research Firm The Bathwick Group Highlights IBM’s Outsourcing Innovation Capabilities

ARMONK, N.Y - IBM (NYSE: IBM) today announced that The Bathwick Group has declared IBM the leader for building innovation into large-scale outsourcing contracts. The standing is a result of recent research as part of the Bathwick Services Index, conducted by The Bathwick Group on prominent outsourcing vendors in Europe.

“Innovation in outsourcing is particularly crucial in this very tough economic climate as it can help the IT function to run more cost-effectively and more efficiently,” said Kate Hanaghan, Senior Analyst, The Bathwick Group Ltd. “Equally, we know that clients who work with IBM value being able to tap into IBM’s deep R&D resources and broad industry expertise in order to experiment beyond the confines of traditional outsourcing agreements. Overall, IBM heads the services pack with an innovation strategy that is mature, well funded and very well received by its customers.”

According to the Bathwick Group report, IBM can build innovation projects into existing outsourcing contracts by allowing clients to work with leading IBM researchers and become part of the think tank, dispatch innovation experts to meet with clients a few times a year or dedicate scientists on a full-time basis. IBM also has the systematic capability of creating and tracking innovation progress in outsourcing contracts.

IBM innovation partnerships leverage the company’s extended resources including research laboratories, technology development, information technology (IT) and business consulting practices to help clients innovate. Innovation partnerships can be formed to address broader business challenges and visions and to increase the value derived from their outsourcing relationships.

“Innovation partnerships are a natural extension of outsourcing relationships, giving clients direct access to IBM’s extended capabilities including research and development as well as our own transformation experience, best practices and lessons learned,” said Dave Liederbach, IBM general manager, strategic outsourcing. “Providing experts from IBM’s vaunted Research arm to address strategic client challenges and deliver innovative breakthroughs extends the core value IBM delivers through IT outsourcing. IBM is uniquely positioned to deliver this kind of higher-value engagement.”

About The Bathwick Group
The Bathwick Group researches how businesses actually buy and apply IT in their businesses, how they innovate using technology, and how IT is supporting changes in market and organizational models. Bathwick’s specific areas of focus include dynamic infrastructure, services, smart information, sustainability, and collaboration. The Bathwick Services Index (BSI), a quarterly in-depth European IT Services research publication, was first published in 2008.

Much of Bathwick’s insight is based on extensive up-to-the-minute data from end users, which results from online benchmarking and IT assessment activities in many countries around the world. The combination of that data and primary research activity with economic and contextual analysis in enterprise, mid-market and small business sectors, creates a range of products including research models, sales-enablement tools, market analysis, and strategic planning consultancy.

For more information, visit www.bathwickgroup.com. Note to Editors: For more information on the complete report, contact Kate Hanaghan at kate.hanaghan@bathwick.com.

About IBM
For more information, visit www.ibm.com/services. Additional press materials on IBM Global Technology Services and a report extract from the Bathwick Group can be found at www.ibm.com/press/ITServices.