Like many companies, driving IT costs down and generating business value out of internal IT has been a major imperative for IBM over the past several years. Since Louis Gerstner came onboard in 1993, the Office of the CIO has been able to lower the cost of hardware, software and networks dramatically through technology standards, enterprise-wide software solutions, and business process transformation. Recently, IBM launched another internal initiative designed to improve efficiency even further by leveraging on demand capabilities. Johnny Barnes discusses how they are moving to the on demand computing era by implementing architecture changes; adding new storage, network and computing technology; and leveraging their business partners. He shares IBM’s experiences to date, the benefits they have realized, the challenges they have faced, as well as IBM’s future plans.