IBM 2013 Annual Report Download - page 7

Complementing traditional back-office systems of record,
enterprises are now taking a systematic approach to engagement
with all of their constituencies—customers, employees, partners,
investors and citizens. Indeed, 57 percent of companies now
expect to devote more than a quarter of their IT spending to these
new systems of engagement by 2016, nearly twice the level of
12 months ago.
They are doing so because the way their customers and their
own workers expect to engage is undergoing profound change.
Seventy percent of people who contact a company via social
media today expect a response within five minutes. Nearly
80 percent of adult smartphone users keep their phones with
them an average of 22 hours a day. This is why we launched
IBM MobileFirst in 2013, and why we have made eight acquisitions
to advance our mobile initiatives. We have 3,000 mobile experts,
and have been awarded hundreds of patents in mobile and
wireless technologies.
When these individuals use their mobile devices to engage
with a company, they expect personalized service. Indeed,
80 percent of people are willing to trade their information for
a customized offering.
The good news is that this is increasingly possible, thanks to
social business and data analytics. But it’s not that simple.
One only needs to follow the news to see rapidly rising concerns—
legitimate concerns—about data security and institutional trust.
Two-thirds of US adults say they would not return to a business
that lost their confidential information. And the economic stakes
are enormous. One analyst estimates that by 2016, there could
be an additional $1 trillion of growth in global online retail—if the
industry can enhance trust.
We have strengthened our already clear leadership in enterprise-
class social business and in security. Our acquisitions in social
include Kenexa, which helps companies use behavioral science
not just to connect with people, but to understand and build lasting
engagement with them. And we have made a dozen acquisitions
in security, building a capability of more than 6,000 security experts,
3,000 patents and 25 labs worldwide.
Finally, IBM is leading by example in building modern enterprise
systems of engagement and learning. Our social platform,
Connections, has 300,000 IBM users and 200,000 communities.
There are more than 30,000 IBMers active on Client Collaboration
Hubs for our top 300 accounts. Last year, hundreds of thousands
of IBMers worldwide shaped the practices that define how we work.
And they are enhancing their skills daily through a massive open
online learning system called THINK Academy.
In 2013, we achieved year-over-year growth of 69 percent in
mobile, 19 percent in security and 45 percent in social business.
Our performance in 2013
You can learn more about the IBM Strategy on pp. 10–23. This
is the context in terms of which to understand our performance
in 2013.
By many measures, it was a successful year for IBM. Our diluted
operating earnings per share in 2013 were $16.28, a new record.
This marked 11 straight years of operating EPS growth. We grew
operating net income by 2 percent, to $18 billion.
In 2013 we invested $3.1 billion for 10 acquisitions. We invested
$3.8 billion in net capital expenditures. We invested $6.2 billion in
R&D, while earning the most US patents for the 21st straight year.