NYSE Media Week CXO Series, theCUBE + NYSE Wired | Janine Sneed, IBM

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Janine Sneed

General Manager, IBM Customer Success & Expert Labs

IBM

play_circle_outline Enhancing Products with AI Models from IBM Research: Use Cases in Customer Experience, Digital Labor, and Code Generation

play_circle_outline Challenges and ROI in AI adoption

play_circle_outline Importance of CIOs prioritizing AI initiatives

play_circle_outline Need for clean data and change management in AI projects

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Janine Sneed, IBM

Janine Sneed

General Manager, IBM Customer Success & Expert Labs IBM

Janine Sneed, general manager for IBM Customer Success and Expert Labs, leads a global team ensuring clients successfully use IBM technology post-sale. IBM focuses on hybrid cloud and AI, integrating IBM Research technology into products. Sneed discussed AI use cases, challenges in adoption, and the importance of clean data and integrating AI into business processes. Vellante and Sneed talked about AI funding, adoption, shifting from pilots to production, and ROI. IBM's own use case with Boston Consulting Group showed $1.5 billion in cost savings. Sneed highl... Read more

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What are the three core use cases for AI at IBM? add

What are some examples of successful ROI and benefits seen in transitioning from pilots to production with AI technology? add

What should CIOs and business leaders focus on in terms of developing skills and integrating AI into applications? add

What are some key considerations for allocating resources and monitoring projects in order to successfully integrate AI into business processes and applications, according to a study from McKinsey? add

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Janine Sneed, IBM

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Dave Vellante

>> Hi, everybody. Welcome back to day two here at NYSE Wired plus theCUBE's continuous coverage. This is our CXO Series at Media Week here. I'm Dave Vellante. I'm really pleased to have Janine Sneed. She is the general manager for IBM Customer Success and Expert Labs at IBM. Welcome back to theCUBE. 2018 at IBM Think you did the pop-up CUBE with John Furrier. You were the chief digital officer of hybrid. The strategy is obviously working.

Janine Sneed

>> Yes.

Dave Vellante

>> So, congratulations.

Janine Sneed

>> Thank you.

Dave Vellante

>> New role.

Janine Sneed

>> Yes.

Dave Vellante

>> I'm not familiar with the Expert Labs. You have to tell me about that, customer success. What are you up to these days?

Janine Sneed

>> Yes. So, I lead a global organization of technical professionals and we take care of our customer for everything after the sale. So, we ensure that we can get clients up and running successfully, using IBM technology, and then our CSMs stay to engage with clients, to ensure adoption, usage, and ensure that they are getting world-class, best-in-class experiences with IBM.

Dave Vellante

>> Ahead of IBM Think this year, which was in Boston, I put out just a little random thought about IBM, I said, "I haven't been more excited about IBM in a long, long time." Talked about hybrid cloud, talked about data, talked about AI, consulting. I said, "All the pieces are coming together, even mainframe is kicking in and things are looking pretty good." Of course, Red Hat turned out to be a great acquisition. And it got literally thousands and thousands of likes, people chiming in. I was actually-

Janine Sneed

>> That's great....

Dave Vellante

>> a little bit surprised. It was kind of cool.

Janine Sneed

>> Yes.

Dave Vellante

>> Now we look around, stocks at an all-time high.

Janine Sneed

>> Yes.

Dave Vellante

>> The strategy that the leadership team, generally Arvind specifically, has done a great job of really getting the company focused. So, that's awesome. This has been a really good stretch. And obviously, the hybrid cloud that you were a part of is a big contributor to that. And now you've got AI with, I call it Watson 2.0, kicking in. So, that's what I see from my perspective.

Janine Sneed

>> Yes.

Dave Vellante

>> What's it like being part of that with clients?

Janine Sneed

>> Well, first off, it's humbling. It's an honor that we are where we are right now, but you used the word focus and it really started with a very focused strategy where IBM does two things. We do hybrid cloud and AI. And every investment that we make organically and inorganically ties back to hybrid cloud and AI. And so, we kind of circle the wagons with products, brand new innovation, mergers and acquisitions that we do. Acquisitions specifically. You look at ecosystem and what we're doing with partners. You look at technical skills and how we've really changed the way we engage with our clients with experiential selling, and it's coming together and we're not done. It feels great.

Dave Vellante

>> Well, when you think about IBM Research, I put that in the category of Xerox PARC, Bell Labs. Bell Labs is no longer in the US, it's owned by Nokia. I'm not sure what Xerox PARC is up to these days, but IBM Research is alive and well. But one of the criticisms that I've always had of IBM is it's always had trouble taking that IBM Research greatness and turning it into product. And I remember I was at an analyst event last November, Dan O'Brien and his team invited us. And I really pushed Dario Gil from IBM Research, and Rob Thomas, who's right in front of clients, on that issue. And I thought they gave a very transparent and honest and really credible approach as to how IBM has really solved that problem. And I think you're seeing it now where the innovation is not just for experiments, it's actually to drive customer value. And I think that sets IBM on a new trajectory in this AI era. Which leads me to how you think about what's coming out of the labs, how customers are absorbing that, specifically in the context of AI. And soon we'll be talking about quantum.

Janine Sneed

>> Yes, absolutely. I agree with you. I think we figured out how to really get the technology out of IBM Research, starting with our Granite foundation models. And what we see at IBM with AI, there's really three core use cases. The first one is all about customer experience and how clients can take advantage of ... There were a lot of what I would call digital assistants, and how they could extend those with foundation models, RAG-based architectures, for better experiences, creating generative net new content. The second use case we see is digital labor. And the third use case is around code and how developers could leverage AI for code generation. And those are the three things that we're seeing. And that's all baked within a nice platform called watsonx. And some of the innovations that you mentioned from IBM Research are part of what we do with the watsonx platform.

Dave Vellante

>> So, the data that we have with our survey partner, ETR, which they're down in New York, they primarily service hedge funds. We have a great partnership with them. We do these quarterly surveys. It shows a couple of stats and I want to get your feedback, see what you're saying.

Janine Sneed

>> Sure.

Dave Vellante

>> They say, "At least 44 to 45% of the customers," this is a sample of 1,800, "say they're stealing from other budgets to fund GenAI." And a good portion of those are from lines of business, marketing, non-IT types of things. They also tell us that, "The ROI expectations," really payback period, "it's getting pushed out just a bit." It used to be, "Oh, I watched the All-In pod and it says I can do this with my eyes closed." Well, it's harder than people thought. So, it's getting pushed from three months. It's more like a year or even two years now. And the NPVs are relatively small. We're not talking about big wins. Now, you've mentioned three use cases. I think of contact centers. I think the digital piece. And then, the code generation is very clearly giving ROI. So, a lot of people in the talking heads you hear, "Hey, we're really not getting the ROI out of AI. What's this trade look like? Nvidia is making all the money." I call it hitting singles. People are kind of getting warmed up. It's like pre-season. What are you seeing in terms of the AI adoption and AI ROI and how it's getting funded?

Janine Sneed

>> Great question. So, we are seeing clients move from what we call pilots over to production. And we are seeing cases of ROI. ROI in the context of maybe 30 to 40% of code that's generated is accepted by developers. We've got cases with customer experience where they're handling questions coming in from clients with 95, 96% accuracy. So, we're absolutely seeing this. And you may have seen out on LinkedIn, IBM's own story of AI productivity with Boston Consulting Group, Arvin and Joanne Wright, where we are client zero, using our own AI technology to automate and offload some of the processes. We saw 1.5 billion in cost savings with line of sight to $3 billion in value. Now, that doesn't happen overnight. And one of the things I'm going to talk about on the CIO panel is one of the key things I believe CIOs need to be successful is how quickly they can see the signal through the noise. There are a lot of experiments running out there, but if they can figure out which pilots are not technically feasible, are not financially feasible, they don't have those models integrated and workflows integrated into their business processes. Shut those down, move on to the things that are working and place the bet there. So, I think that's one key thing that is going to be important for CIOs and business leaders as well as how they're developing skills, how they're integrating AI into applications. And it's not just about IT, it's also about business. Business has to be at the table with you to make those decisions. Think about two of the three use cases I mentioned are absolutely about line of business, not just tech.

Dave Vellante

>> Yeah. And so, the fact that you have done that client zero, some people call it drinking their own champagne, sometimes they call it dog food.

Janine Sneed

>> Yes. Dog food. Eating your own dog food.

Dave Vellante

>> But what I've seen, I'd love your feedback on this, is customers come up with a huge list of potential initiatives. It's giant. And the technology team says, "Well, wait a minute, let's pare this down." But they don't always know where the real ROI is. And so, the business person, he or she who speaks the loudest or maybe has the biggest P&L might get priority, but the fact that you have experience there. So, how is that experience, maybe it's through the consulting organization or even your organization, getting translated to clients to help them prioritize?

Janine Sneed

>> Right. I think one of the things that we see is how organizations can set up some sort of a central clearinghouse and it's cross-functional. It's with IT. It's with line of business. It's with legal. It's with chief procurement officers. It's with chief privacy officers. And how they're coming together to first, what are the business goals? You got to start with your north star. What is the business trying to do? From there, what are the use cases? From there, do I have the data? Is the data clean? Is it contextual? Is it relevant? Can I integrate that data into the models? Then you look at the tech stack and governance. So, those are some of the things that we are seeing. And in that central clearinghouse that team is looking at, "Okay, this is the number one priority, this is number two. How do we allocate resources? How do we monitor the projects are working and taking off with ROI?" It is truly cross-functional. And I will also add one thing. I read this study from McKinsey and they were talking about really what CIOs need to do to accelerate and scale AI. And you look at costs, and one of the things that can quickly get out of control in all of these use cases is not just the cost of AI, because some of the models are coming down, but change management. For every $1 being spent in IT, you're spending three on change management, because it is truly about how you're able to get the AI integrated into your business processes and applications and change the way you and I work. It will change the way we work.

Dave Vellante

>> Yeah. So, despite the fact that technology is coming out ... Everybody talks about it coming out faster than it ever has in history, the adoption actually is not happening necessarily faster than it is in history. Of course, we're all experimenting with GenAI, but because of change management, it still takes many years oftentimes for the organization to really see that impact. So, AI is still not yet self-funding. Would you agree? In other words, we're still having to maybe take money from other budgets. The IT spending macro, maybe it's growing at a point higher than GDP.

Janine Sneed

>> Yeah.

Dave Vellante

>> So, I'm looking for when AI becomes self-funding, because I think it will launch a broader macro trend.

Janine Sneed

>> Yes.

Dave Vellante

>> Maybe not as big as it was during the tech bubble during COVID.

Janine Sneed

>> Yes.

Dave Vellante

>> But it sounds like you're starting to see that gain sharing happening in real-time.

Janine Sneed

>> We are. We are. In fact, it was 2023 AI Adoption Index, and we studied a bunch of companies and we saw 40% of the companies in the study were in production with GenAI. 42% weren't. And some of the reasons why they weren't were skills and change management and prioritization of use cases and so forth. So, I do believe the spending is going to get larger. I think I saw $1 trillion in opportunity by 2030. So, there will be shift, but I also think the spend is going to get larger for software. And then, I also think that's going to drag along services because companies are going to be looking for expertise to do data modernization, because you got to have clean data, AI transformation, and then how you're going to be able to take that AI and integrate it into your business.

Dave Vellante

>> I'm surprised at how many IT decision-makers that we talk to feel like they're going to buy AI integrated, but a lot are saying they're going to buy it not integrated. They're going to sort of play around. I would've thought, and maybe it's going to just take some time, that AI is going to be infused into applications, into infrastructure. It's going to largely be ... It's going to be visible, but it's going to be underneath. You're not necessarily going to be DIY-ing your AI. What are you seeing in terms of that sentiment?

Janine Sneed

>> I think it's a little bit of both. I see more clients talking to us about open source, and we just released our Granite models under the Apache license, so they're open source, and how they can take advantage of that. Because if you think about it, you probably have the world's internet inside of these foundation models, but less than what? 1% of enterprise data, your enterprise data is inside of the model. And so, how you do that ... Because a lot of this is new, you mentioned earlier, it's just the rate and pace of how fast AI is changing. You're going to look for expertise to come in and help you do it. So, I think it's going to be a mix of open source technologies, technologies that you have, and some proprietary technologies. And of course, doing this in a hybrid way.

Dave Vellante

>> It's hard not to be excited about these very large foundation models that are coming up. But the interesting thing to me about Granite is we wrote a piece from LLMs to SLMs to SAMs, small action models, that 90% of data that's not there or the processes that just can't be hard coded into microservices. Which brings me to agents. So, do you remember dial up?

Janine Sneed

>> Yeah.

Dave Vellante

>> I remember the first time I did dial-up remotely and I was checking cc:Mail and I was just so excited. And I look back on that and sort of laugh. It can't compare to what it is today.

Janine Sneed

>> Yes.

Dave Vellante

>> And a lot of people compare the period that we're in now with the initial dial-up era of the internet. So, I'm just really excited to see what's coming down the road. And the agentic movement, I think, has a great potential. A lot of people are talking about co-pilots or single agents. The idea of having multiple agents actually work in concert and present plans to humans is, to me, really, really exciting. But to your point, you've got to have your data estate in order. You've got to be able to harmonize that. What are you seeing or hearing from the conversation with CIOs in terms of how they're thinking about this agentic era?

Janine Sneed

>> Yeah. I think they're excited about it. I think it's pretty new. I think they're trying to understand where is the logic and where's the reasoning? How is it working? That's coming in from a technical perspective. I think it's probably still a little bit early, but it's coming, and I think it's going to be integrated into the way we work.

Dave Vellante

>> So, back to customer care, which is your wheelhouse these days.

Janine Sneed

>> Yes. Yes.

Dave Vellante

>> So, we talk about cloud native all the time. Now we're starting to talk about AI native. We're starting to see AI native capabilities. Contact center is obviously one. Do you think we'll see anytime soon or how widespread it will be, just AI-only customer care?

Janine Sneed

>> I don't know. My view of more of a human and AI, because I do think human in the loop helps with ... Not every use case is going to be human in the loop, but there are going to be some use cases where humans were in the loop. I think it's also generational and time, right? There are some things today we would say, "We would never use technology for that." But we do. So, I think as there's more trust in knowing what went into the AI, what went into the model, it's going to become more pervasive. I think time will tell.

Dave Vellante

>> Yeah. I know I've just found our own experience when you're on the phone saying, "Agents. Please, agents. Get me to an agent." Because you need a human.

Janine Sneed

>> I know. Yeah.

Dave Vellante

>> And maybe someday when we say agent, we'll get an AI agent that actually can help us.

Janine Sneed

>> I know. I know. But do you think it's gotten better? Do you think some of the AI agents that you've worked with or digital assistants have gotten better?

Dave Vellante

>> Slightly. I would say slightly. I'll tell you what's better is the routing. You're not routed around as much. And it does depend on how much the company's leaning into AI.

Janine Sneed

>> Yes.

Dave Vellante

>> So, you can get to the answer faster.

Janine Sneed

>> Yes.

Dave Vellante

>> So, that's noticeable, I think. Yeah, fraud detection is another one that just keeps getting better and better and better. But back to customer care, I would love to see the point at which the agents, multiple agents can observe over time that human tribal knowledge and incorporate it in a way that they could perhaps interact with a customer and the customer could actually ... That human could guide the agents in a way that they can actually get to a resolution.

Janine Sneed

>> I agree.

Dave Vellante

>> And I think that day's coming.

Janine Sneed

>> I agree. With sensing emotion, the memory in there, and perceiving the reaction on the other end, right? Of how you as the customer are feeling and seeing. And I agree, I think it's coming sooner than what we think, but time will tell.

Dave Vellante

>> Well, I think the key is it goes back to data. The data has to be harmonized. The data has to be governed.

Janine Sneed

>> Yes.

Dave Vellante

>> It's got to be trusted in order for these agents to work on it.

Janine Sneed

>> That's right.

Dave Vellante

>> So, you've got a data play, you've got infrastructure, you've got containers, you've got AI, you've got the consulting expertise in a variety of industries. All the pieces are coming together.

Janine Sneed

>> Yes.

Dave Vellante

>> So, congratulations.

Janine Sneed

>> We're excited about it. Thank you. Thank you so much.

Dave Vellante

>> Thanks for coming on theCUBE here at NYSE.

Janine Sneed

>> Happy to be here.

Dave Vellante

>> It's great to have you.

Janine Sneed

>> Thank you. Thank you.

Dave Vellante

>> And good luck with your CIO talk today.

Janine Sneed

>> Thank you so much.

Dave Vellante

>> All right. You're welcome.

Janine Sneed

>> All right.

Dave Vellante

>> Keep it right there. This is Dave Vellante, NYSE Wired plus theCUBE day two of our CXO Series. We'll be right back, right after this short break.