Arik Hesseldahl

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IBM Acquires Emptoris, Boosting Smarter Commerce Plans

IT giant IBM said today that it will acquire Emptoris, a privately held 725-person operation that builds analytics software keyed to understanding the ins and outs of a supply chain, and which runs both in the cloud and on-premise.

Emptoris is based in Burlington, Mass., and its customers include American Express, ADP, Kraft Foods and Samsung America.

IBM is describing the deal as the latest move to fill out its “smarter commerce” initiative. And if you follow IBM, you know that making something “smarter” — whether it’s commerce or a city or the entire planet — generally means throwing some computing power and analytics up against a classic, complicated problem, which frankly, supply chains always are.

When you start looking at the patterns of what companies buy in the normal course of doing business — how often and how much not having some critical component or material can disrupt production — you start to see inefficiencies that cost time and money. Eliminate those inefficiencies, the thinking goes, and you start shaving down those costs, and start running the business in a more efficient manner. Usually, the saved costs go straight to the bottom line. That’s something that any CEO or CFO can get behind, and IBM says that doing this sort of thing is a $20 billion global market opportunity on software purchases alone.

IBM’s press release quotes Craig Hayman (pictured above), its general manager of industry solutions, who talked to AllThingsD in July about how IBM is helping companies manage their marketing. Hayman says that corporate procurement departments are increasingly being asked to show how they deliver value to a company. Emptoris will fit alongside IBM’s 2010 acquisition of Sterling Commerce.

Financial terms of the deal haven’t been disclosed, which means it’s a relatively small deal for Big Blue. But it’s also the second deal it has done this month in the smarter-commerce area. Last week, IBM spent $440 million to grab DemandTec, a software outfit that specializes in analyzing buyer behavior.

By 11:15 am ET, IBM shares fell on the news by 99 cents, or less than 1 percent, to $187.73. The shares have been on a steady climb all year, and as of yesterday’s close were up nearly 29 percent since the start of 2011.

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