Tech giant IBM is strengthening its automation and cloud capabilities with the announcement of its acquisition of software company Apptio for $4.6 billion.

Apptio has over 1,500 customers leveraging its software-as-a-service offerings including financial and operational IT management and optimization (FinOps) software. The acquisition will complement IBM’s existing resource optimization, observability, and application management offerings,

Over the years, IBM acquired a number of companies to strengthen its tech solutions and services offerings especially at the height of the pandemic when companies relied heavily on technology for business continuity. 

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“Technology is changing business at a rate and pace we’ve never seen before. To capitalize on these changes, it is essential to optimize investments that drive better business value, and Apptio does just that,” said Arvind Krishna, CEO and chair of IBM.

Software management

Now that hybrid work is becoming the new norm for most organizations, IBM believes that Apptio’s solutions will provide companies with solutions that can be utilized across hybrid and multi-cloud environments, labor and associated resources. 

“Our customers are evolving to a complex digital-first, hybrid world where technology investments are distributed and decentralized but all innovation must be aligned with clear business outcomes,” said Sunny Gupta, co-founder and CEO, Apptio.

Apptio enables companies to manage technology spend and direct investments to high-value cloud innovation and digital transformation. Its partners include Amazon Web Services, Microsoft Azure, Google Cloud Platform, Salesforce, ServiceNow, Oracle and SAP.

Observability capabilities

“Apptio’s offerings combined with IBM’s IT automation software and watsonx AI platform, gives clients the most comprehensive approach to optimize and manage all of their technology investments.”

Apptio and the performance optimization and observability capabilities of IBM’s IT automation software will provide clients with a 360-degree technology business management platform, providing a “virtual command center” for spend management and optimization stretching across their entire technology landscape. Apptio will bring to IBM $450 billion of anonymized IT spend data, unlocking new insights for clients and partners.