IBM CEO Krishna: Q2 Weakness Due To Deal \u2018Deferral, Not Destruction\u2019<\/a>]<\/p>\n IBM Consulting In The Agentic AI Era<\/p>\n
But Ali also notes that an advancing IBM Consulting\u2014where he\u2019s held the senior vice president role since 2024\u2014is also to the benefit of other IBM solution providers, some of which count among the hundreds if not thousands of subcontractors Ali\u2019s organization works with on projects.<\/p>\n
\u201cWhen we do [some projects], we bring together 50-plus companies in order to execute that,\u201d Ali told CRN in an interview.<\/p>\n
Clients engaging with the agentified IBM Consulting can draw not only on 150,000 consultants and IBM engineers, but also on thousands of AI agents that support customers\u2019 preferred models and technology stacks.<\/p>\n
These clients can hire consultants and these digital workers to collaborate on projects across the organization\u2019s practices in technology transformation, business transformation, application management services, business process outsourcing and cybersecurity.<\/p>\n
IBM Consulting Combines Human Expertise With 6,000 AI Agents<\/p>\n
IBM Consulting has built what Ali calls an \u201cuber harness\u201d in its IBM Consulting Advantage platform that allows clients to leverage any AI vendor and technology stack for accomplishing projects. IBM Consulting today leverages about 6,000 digital workers, bringing in some of IBM\u2019s finest engineers to reduce the number from an initial 50,000.<\/p>\n
The solution provider has also partnered with Pearson to verify AI-agent capabilities and give agents credentials to boost client confidence in the technology, Ali said.<\/p>\n
Ali has also seen IBM Consulting\u2019s midmarket customer segment grow over time thanks to the division leveraging AI agents to complete more work more quickly with smaller teams.<\/p>\n
\u201cIBM Consulting has always been known for high quality\u2014if you want to get a project done and done right, you go to IBM Consulting,\u201d Ali said. \u201cWhere we\u2019re going next is high quality at affordable costs.\u201d<\/p>\n
IBM Consulting is still working out the right licensing and pricing mechanism for clients interested in buying digital workers, Ali said. \u201cThat is the next frontier,\u201d he said.<\/p>\n
The organization is experimenting with rate-card pricing for using digital workers for a period of time.<\/p>\n
In IBM\u2019s most recent quarterly results\u2014covering the three months ended June 30\u2014the Consulting division brought in $5.3 billion in revenue, up 1 percent ignoring foreign exchange. IBM Consulting saw signings grow 6 percent year on year, a second consecutive quarter of growth.<\/p>\n
IBM Consulting\u2019s profit margin also grew 160 basis points during the quarter, faster than IBM Software\u2019s 110 basis points. IBM Consulting reported a gross profit margin of 28.9 percent for the quarter and segment profit margin of 12.1 percent for the quarter.<\/p>\n
IBM expects IBM Consulting to accelerate revenue growth to low- to mid-single digits for the year, according to the vendor.<\/p>\n
IBM Consulting\u2019s Ali On Its AI Services Lead<\/p>\n
Asked about IBM Consulting maintaining its differentiation in the channel should more solution providers adopt AI and AI agents in a similar way, Ali put the organization\u2019s institutional knowledge above those of competitors and how IBM Consulting builds all its skills\u2014modular packages of instructions, scripts and resources for AI agents\u2014within its IBM Consulting Advantage platform in a way that protects intellectual property.<\/p>\n
\u201cThe bigger that pool of IP, the harder it is for another consulting company to catch up,\u201d Ali said. \u201cWhich then makes us an incredible channel partner to the OpenAIs, the Anthropics, the [Google] Geminis, as well as the [Microsoft] Azure AI Foundry stack, the AWS Bedrock stack, etc. This is the moat we\u2019re building.\u201d<\/p>\n
Ali estimated that IBM Consulting Advantage uses about 500 billion tokens a month, with a model router feature optimizing token use as another differentiator for the organization and a \u201cProcedure Eater\u201d workflow analysis tool to help with re-engineering processes.<\/p>\n
About 30 percent of IBM Consulting\u2019s largest projects are using humans plus digital labor, Ali said. \u201cI don\u2019t think any of our competitors have that and have that running at this massive scale,\u201d he said.<\/p>\n
At a time when solution providers of various sizes are exploring what pricing models make sense in the AI era, IBM Consulting has been moving more into a fixed-price model because of its confidence in teams\u2019 abilities to complete the projects, Ali said. But the division is comfortable with outcome-based pricing for clients who prefer that model.<\/p>\n
Today, IBM Consulting serves not just as a major solution provider for IBM, but Microsoft, Google and Amazon Web Services as well as ISVs. The division has also struck major partnership deals with some of the hottest AI upstarts in technology.<\/p>\n
On Aug. 13, IBM revealed a strategic partnership with ChatGPT maker OpenAI that includes embedding GPT-5.6 and other OpenAI frontier models plus Codex, ChatGPT Work and other OpenAI products into IBM Consulting Advantage, IBM\u2019s AI platform for delivering consulting services to clients.<\/p>\n
As part of the deal, IBM also pledged to launch a dedicated OpenAI practice with thousands of consultants and engineers obtaining expert-level certifications under the OpenAI Partner Network plus leveraging forward-deployed units (FDUs) of specialized engineers and consultants trained through the OpenAI Partner Network to work with clients to accelerate AI implementation across complex business workflows and highly regulated environments.<\/p>\n
IBM Consulting\u2019s investment in FDUs comes as vendors across the channel\u2014including Microsoft, Salesforce, Anthropic and OpenAI\u2014have been investing in forward-deployed engineers, with vendors largely positioning FDEs<\/a> as resources for their channel partners.<\/p>\n\u201cPart of why IBM has been successful for many, many, many decades is that we don\u2019t just sell you products,\u201d Ali said. \u201cWe bring some of the smartest people on the planet to implement it.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"\u2018Part of why IBM has been successful for many, many, many decades is that we don\u2019t just sell…\n","protected":false},"author":2,"featured_media":150705,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[6],"tags":[405,408,7537,420,410,14492,9958,10868,402,8916,403,416,313,9955,411,421,9954,223,400,401,4956,1777,6493,414,9084],"class_list":["post-150704","post","type-post","status-publish","format-standard","has-post-thumbnail","category-agentic-ai","tag-ai-agents","tag-ai-applications","tag-artificial-intelligence-agents","tag-azure","tag-business-intelligence-and-analytics","tag-channel-programs","tag-cloud-channel-programs","tag-cloud-marketplace","tag-cloud-platforms","tag-cloud-security","tag-cloud-software","tag-copilot","tag-cybersecurity","tag-data-protection","tag-database-and-system-software","tag-edge-computing","tag-endpoint-security","tag-generative-ai","tag-managed-security","tag-managed-service-providers","tag-network-infrastructure","tag-network-security","tag-partnerships","tag-security-operations","tag-windows-11"],"_links":{"self":[{"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/posts\/150704","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/comments?post=150704"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/posts\/150704\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/media\/150705"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/media?parent=150704"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/categories?post=150704"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/tags?post=150704"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
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