This was the message Rometty delivered Thursday night in a speech before more than 170 business leaders at the Council on Foreign Relations, a New York-based think tank specializing in U.S. foreign policy and international affairs. The speech, one of Rometty's first major public appearances since becoming IBM's first female CEO 15 months ago, laid out a surprisingly brand- and technology-neutral vision for how organizations should adapt to the emerging big data era.
Cloud, mobile and social may be the buzzwords of the day, but the real impact of these trends, said Rometty, will be in the data that they generate. "Many more decisions in your company or entity will be based on predictive analytics, not gut instincts or experience… because they can be based on all this data," she said.
[ Want more on the cognitive computing era? Read IBM's Watson Could Be Healthcare Game Changer. ]
Rometty cited the example of the Memphis Police, an IBM customer that reduced citywide crime by 31%, in large part through a program called CRUSH (Crime Reduction Utilizing Statistical History). But rather than elaborating on IBM's products, Rometty stressed that the hard part in embracing predictive decisions will be overcoming mindsets and corporate culture. "People will have to unlearn how they make decisions," she said, whether that's within hospitals, schools or companies.
On value creation, Rometty described social networks as "the new production line." Here she cited the example of Mexican cement manufacturer Cemex, which used social networking among far-flung product-development teams to launch a global brand in one-third the time it previously required to launch a local brand.
Now that all employees are essentially accessible at all times, "your value will be not what you know, but what you share," Rometty said.
IBM itself will prove this point in the near future, she said, by having employees rate each other and asking customers to rate employees. "You'll be rated by the information you create, how you share it, its value, and maybe we'll even pay you that way," she said. "Five stars, one compensation level, two stars, no [incentive] compensation."
Value will be delivered to individuals, not segments, in the future, Rometty predicted. So instead of serving 17- to 25-year-old males, people at a certain income level, or groups of people by zip code, businesses will sell to, service and interact with individuals by collecting and relying on the data behind those interactions.
"If you have a call center, it's no longer about a script, it's about a dialogue," she said. "If you're in advertising, it's not about a promotion, it's about a two-way discussion ... and every one of us will expect something in return, whether you're a citizen or an employee or a customer."
Rometty pointedly avoided mention of products or particular technologies during her remarks, but when asked to say more about technology during a question-and-answer session, she said that we're now entering a third wave of computing. The first wave was about computers used to count. The second wave saw the development of programmable computers that could execute instructions.
"The third era will be about computers that learn," she said. "It has to be because information is too big and growing too fast, so you can't program it. The computer has to learn, by itself."
This new era will be fueled by big data, she said, and she connected the dots to IBM Watson, the Jeopardy-playing, cognitive-computing machine that is now being trained to serve as a medical adviser for oncologists and an expedited decision aid for health insurers. Watson is also being trained for human-assistance roles in financial services and call center operations.
"This is, I believe, one of the greatest contributions that IBM will make in the future," Rometty said of Watson.
IBM's CEO closed her remarks by saying that all organizations will be forced to change in the big data era because they will be increasingly exposed through the cloud, mobile and social trends and related data analysis. But that will bring valuable benefits.
"The greatest contribution of this shift is that it will force every entity -- private, public, government -- to become an authentic organization," she said.
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