tbr study on ibm windows servers

IBM System x Consistently

Meets High Customer

Expectations for Product

and Service & Support

A Retrospective Analysis of IBM x86-based

Server Customer Satisfaction

May2011

TBR TECHNO LOGY BU SIN ESS RESEARCH , IN C .

2 TBR Whitepaper | May 2011 Technology Business Research Inc.

IBM System x Exhibits Strong Aptitude for Meeting

Customer Expectations

Executive Summary

Because thex86 serverhas become the dominant computing platform

in the datacenter, businesses demand high levels of product and

service and support service quality from their server partners. IBM

System x servers, as measured by TBR’s quarterlyx86-based Servers:

Corporate IT Buying Behavior & Customer Satisfaction study,meet

those needs by providing consistently high levels of hardware

reliability, phone support as well as delivery times for new systems.

IBM System x has long been recognized by customers for strong

products and quality service. TBR believes that customers are rating

IBM on what they see as itsparticular mix of product reliability and

quality and service excellence, resulting in a feeling of overall value

with high levels of satisfaction with System x servers. IBM’s System x

has held the number-one ranking in TBR’s x86 server study for the last

seven quarters as a result. The System x server line’s dominance in the

TBR study during this timeframe is illustrated in the 16 incidences of

competitive strength across six of the study’s satisfaction categories.

TBR assigns competitive strengths when a vendor demonstrates brand

differentiation by scoring substantially above industry averages and

more effectively meeting—or exceeding—customer expectations.

Hardware

Reliability, 3

Virtualization

Solutions, 3

Delivery Time, -2

Energy Efficiency, 2

Management Tools, -2

Management Tools, 2

Delivery Time, 3

Phone Support, -3

Phone Support, 3

-14

-12

-10

-8

-6

-4

-2

0

2

4

6

8

10

12

14

16

18

Dell HP IBM# Incidences Where TBR Assigned Competitive Strengths or

Warnings/W

eaknesses

x86-BASED SERVER SATISFACTION PERFORMANCE DIFFERENTIATION,

Past 7 Reporting Periods (3Q09 through 1Q11)Sources: TBR x86-based Servers: Corporate IT Buying Behavior & Customer Satisfaction Studies

TBR


For this paper, TBR analyzed IBM’s competitive performance over the

past sevenquarters within our Corporate IT Buying Behavior & Customer

Satisfaction Studies in the x86-based server market. With this

retrospective analysis, TBR zeroed in on the evidence that supports

IBM’s continued ability to successfully meet customer expectations for

System x server quality, reliability and technical support.

TBR has determined that IBM’s continually strong performance in our

study can be tied to the interrelated effects of four underlying

principles:

1. Leading performance, reliability and efficiency:When compared to

its counterparts in servers, Dell and HP, IBM consistentlydelivers

higher marks in customer satisfaction for hardware quality and

reliability, services and support and energy efficiency – areas of key

concern for x86 server customers both now and in the future as

workloads within the data center increase.

2. Consistency and stability of support:Customers have also

consistently rated IBM’s phone support highly despite the ups and

downs of the economy. IBM phone support consistently scored

highly throughout the economic downturn in 2009, when many

customers kept their servers for longer than expected, and also in

the exuberance period that followed in 2010 as companies replaced

their servers en masse. Now, as customer satisfaction rates have

returned to more normal patterns, IBM continues to retain

leadership in this and many othercategories.

3. Continuing to meet high customer expectations:System x’s

consistent performance in meeting customer expectations over the

past several quarters has led to increased expectations from its

customers – setting the bar even higher for IBM. But despite having

higher expectations than its rivals, IBM has continued to meet or

exceed in most satisfaction categories in TBR’s study.

4. Server value:TBR believes that IBM’s innovations around areas such

as memory capacity, server performance and virtualization is driving

an ROI message that resonates with businesses – illustrated by

higher-than-average customer server value satisfaction ratings over

the past few quarters.


The path to Customer Satisfaction

Over time, IBM has proven to be less susceptible to the recent ups and downs of overall

customer satisfaction during period between the recession of 2009 – a time during whichaging

server hardware was kept in service – and the significant upswing in server purchasing and

customer satisfaction that followed in 2010. In 1Q11, as a period of normality returned to the

industry and the exuberance of the previous year faded away, IBM took advantage of its

foundation of satisfaction created in the previous quarters, while continuing to meet or exceed

customer expectations, placing it ahead of Dell and HP in overall satisfaction in TBR’s 1Q11

server report.

In addition, 1Q11 results set the stage for continued success for IBM in the coming quarters,

with another round of purchasing expected on the heels of new server processor releases by

Intel. TBR anticipates an upswing in customer satisfaction as IBM, Dell and HP roll out new

systems based on the processor platforms. IBM’s consistency over the past six quarters bodes

well for its performance in coming quarters, as participants in TBR’s study indicate intent to buy

hundreds of x86 based servers – 125 each, on average – over the next 12

months.


IBM Breeds Performance, Reliability and Efficiency

IBM outpaced its rivals in 1Q11 and the preceding five reporting periods

by earning competitive strengths in hardware quality and reliability.

Businesses are working to navigate a rapidly changing datacenter

environment – with memory limitations, increasing complexities, and

growing mission-critical workloads – and an environment in which IT

budgets are flat, forcing IT staffs to increase the services they offer

despite restrained resources.At the same time, x86 server users – the

company divisions or lines of business that do the work – are

seekingtechnologies and services that enable them to address the

demands of specific workloads, ease the crunch of both limited

resources and increasing complexity, and provide help as needed.TBR’s

customer satisfaction study also has consistently found that energy

efficiency, an adjunct to decreased power and cooling costs for the

datacenters, is rising in importance. Energy efficiency and virtualization

are areas where IBM has historically scored well. At the same time,

companies are moving mission-critical workloads onto their x86 systems

and seek simplified deployment through


virtualization.


IBM Has Built a Foundation of

Consistency and Stability

IBM has maintained a level of consistency

that has enabled it to continue

differentiating from rivals. Despite

changes in the overall market, IBM has

minimized changes in customer

satisfaction, both during the dramatic

cutback in IT spending during the

economic turmoil of 2009, and during the

enthusiastic buying spree that followed.

Since mid-2010, server purchasing plans

have settled into a more usual pattern of

sustained spending.

The exuberance of the post-recession

hardware spending spree has ebbed to a

more practical tone and, along with that

change; customer satisfaction levels with

all three vendors have receded.Yet IBM’s

consistency, driven by phone support,

hardware reliability and server delivery

times, has kept System x on a level track.

IBM earned the overall top position in

TBR’s 1Q11 x86 Server report as its

customer satisfaction rating jumped for

the second consecutive quarter –

outpacing HP and Dell.

IBM scored its third consecutive

competitive strength for high customer

satisfaction related to on-time delivery.

On-time delivery was less important than

it was during the exuberant buying period

in 2010,but the metric remained key to

x86 system users. IBM’s consistency in this

area position it well to meet increasing

customer demand for on-time delivery in

coming quarters as new iterations of its

System x servers arrive.

Finally IBM continued to lead its two


competitors in the area of server value in 1Q11. TBR believes that businesses sought lower TCO when

replacing their servers in 2010, and will continue to do so in 2011. While refreshed portfolios from IBM,

Dell and HP portend more spending, most respondents in TBR’s 1Q11 report said they would keep their

2011 technology spending at 2010 levels. That puts server value solidly on IT departments’ checklists,

which is an advantage for IBM, which scored significantly higher than its

competitors.

Despite High Customer Expectations, IBM Consistently Meets or Exceeds on Satisfaction

IBM’s high scores have raised the expectations of its customers, who have grown accustomed to a highly

positive experience in dealing with the company. IBM, over the past several quarters, has successfully

met those expectations in almost every area within the TBR study, and 1Q11 was no different. TBR

tabulates its Weighted Satisfaction Index (WSI) rating through an examination of customer expectations

and the vendor’s ability to meet those expectations. High expectations that haven’t been effectively met

(i.e., low or moderate satisfaction) can negatively impact the score calculation. Alternatively, a high-

expectation category with high satisfaction means an advantage for the vendor. In 1Q11, IBM was

awarded competitive strengths in phone support and on-time delivery and its WSI position held steady,

illustrating continued dominance over competition.


IBM’s Customer Satisfaction Success is in the Ability to Meet the

Right Expectations at the Right Time

TBR believes that IBM’s continued success in our customer satisfaction

study comes from its ability to understand customer needs and

expectations and meet or exceed them. During the recession of 2009,

when much of IT spending was cut back dramatically, IBM met customer

demands at a much higher rate than its competitors thanks in part to its

phone support.

IBM was well-positioned when the market turned around and corporate IT

spending increased in 2010, meeting expectations with its fifth-generation

X-Architecture and the services built around it, by leveraging factors

including performance, efficiency and delivery times.

As spending patterns returned to normal in 4Q10 and 1Q11 and

companies put their new servers into use, IBM has seen its customer

satisfaction increase in such categories as phone support and on-time

product delivery – areas of competitive strength for the company – as well

as server value.TBR believes that IBM will continue along this path with

consistent delivery of phone support, server performance and relative

value even as new challenges will rear up in late 2011 and early 2012.


About the Studies

TBR’s ongoing Corporate IT Buying Behavior & Customer Satisfaction

Studies (published in four separate volumes each quarter covering

Desktops, Notebooks, x86-based Servers and Service & Support) have been

conducted since the first quarter of 1997. For vendors, distributors, large

end-users and the investment community, this program has become the

preeminent tactical tool for monitoring customer satisfaction from quarter

to quarter.

The 1Q11 study, published in May 2011, was based on the view of 499 x86

server decision-makers at midsized and large corporations in the United

States and Canada, representing a total installed base of about 270,000

x86-based servers and purchase intent of 62,000 units during the next 12

months.

About TBR

TBR specializes in providing in-depth and timely insights within the

computer, software, telecom, mobility and professional services industries.

These critical insights can provide value to all levels of your organization:

Executive, sales, marketing, product and business development, finance,

procurement, and others. We deliver this intelligence in a format that is

uniquely responsive and tailored to your needs, and we do so as an

objective source, which allows you to look at the market from a fresh,

impartial perspective.

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