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IBM bolsters social business schemes


Johannesburg, 29 Aug 2012

Global IT corporation IBM has acquired human resources software company Kenexa, in a $1.3 billion deal.

The acquisition of publicly held US-based Kenexa entails a cash transaction at a price of $46 per share.

IBM says the acquisition “bolsters IBM's leadership in helping clients embrace social business capabilities, while gaining actionable insights from the enormous streams of information generated from social networks every day”.

Kenexa, a provider of recruiting and talent management solutions, combines cloud-based technology and consulting services that integrate both people and processes, “providing solutions to engage a smarter, more effective workforce across their most critical business functions”.

Social steps

Social business is a recent, but popular, trend that is changing the way companies function and generate value for all their constituents, including stakeholders, employees, customers, partners and suppliers.

According to IBM, the adoption of social business technology is supporting the growth of big data and the need for analytics in the enterprise. A recent global IBM study revealed that 57% of CEOs identified social business as a top priority, while more than 73% are making significant investments to draw insights into available data.

The survey also reveals that 70% cite human capital as the single biggest contributor to sustained economic value. In light of this, IBM says the combined forces of IBM and Kenexa are key differentiators at a time when organisations of all sizes are looking to increase workforce efficiencies and gain more insight from their business information.

“Social media has pervaded the lives of consumers, helping them connect with each other in new ways. However, a shift is occurring in the enterprise as business leaders look for ways to generate real value through the use of social technologies to evolve their front-line business operations.”

According to Forrester Research, the market opportunity for social enterprise apps is expected to grow at a rate of 61% through 2016.

Alistair Rennie, GM of social business at IBM, says companies across all business operations are looking to tap into the power of social networking. “IBM is uniquely positioned to help clients generate real returns from their social business investments, while helping them gain intelligence into the data being generated in these networks to be more competitive in their markets.”

Acquisition advantages

IBM says Kenexa's front-office process solutions will enable it to offer strategic consulting, a social technology platform, and expertise on a global scale to help clients enable a smarter workforce.

The Kenexa acquisition will complement IBM's social business and HR business services. According to IBM, more than 60% of the Fortune 100 companies have licensed IBM's solutions for social business.

With operations in 21 countries worldwide, Kenexa has approximately 2 800 employees. IBM says - as per its strategy - it plans to continue to support Kenexa clients and enhance Kenexa technologies, while allowing these organisations to take advantage of the broader IBM portfolio.

IBM expects the transaction to close in the fourth quarter of 2012, subject to Kenexa shareholder and regulatory approvals, and the satisfaction of other customary closing conditions.

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