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IBM aims for worry-free business projects

With a free two-year performance protection plan, IBM is saying "don't worry" to its leading Unix customers embarking on some business software projects.

No worries.

With a free two-year performance protection plan, IBM is sending that message to its leading Unix customers embarking on some business software projects.

Initially, the offer will be made to customers installing the Somers, New York-based company's RS/6000 server fitted with Baan's enterprise resource planning software, applications that run core corporate functions such as financials and human resources.

The plan gives IBM a new way to differentiate itself and maintain its edge in the battle for the midrange ERP space with Hewlett-Packard and Sun Microsystems, said Brad Day, an analyst with Giga Information Group.

Both HP and Sun, as well as enterprise resource planning vendors, now offer limited performance guarantees or guarantees at a price, he said. IBM's performance protection removes a company's "capacity planning nightmares and projected performance worries," Day said.

Under the guarantee, announced yesterday, IBM agrees to a free performance upgrade if the company fails to meet customer expectations. If performance lags, IBM will upgrade the customer to a more powerful platform, including a more powerful processor or memory, company executives said.

Available through IBM's business partners, the plan applies to companies that have chosen one of IBM's six preconfigured RS/6000 systems running Baan business applications.

Michael Maas, product manager for RS/6000, said the guarantee is intended to give small to midsize companies confidence in using ERP software to revitalize their businesses by cutting the risk of costly investments.

"Small to medium size businesses have different characteristics than the Fortune 500," Maas said. "They don't have large IT staffs. They need to implement more quickly and the confidence level is much less because of less internal expertise. The consequences of failure are very large."

As are potential profits for enterprise resource planning vendors and their partners. The ERP market is expected to reach $52 billion by 2002, according to AMR Research in Boston.

IBM's six standard configuration packages are available with Baan software for 50 to 250 concurrent users, with a DB2, Oracle, or Informix database running an RS/6000 F50 or S70. More than 100,000 companies use 650,000 RS/6000 systems.