“The second is our software. And that software, when you look at it, at the high end of the range at 8%, that is the second half that's approaching double digits based on what Arvind said, the strength of our 80% high-value recurring revenue accelerating and a return to some normal level of closure rates of a strong pipeline in the second half.”

In context

“James Kavanaugh : Yes. I think it's plain and simple. Arvind has been running this company for the last 6 years around 2 key components of KPIs. We just talked about one, free cash flow because that's the engine that provides the financial flexibility for growth. The first is revenue growth. We've taken this company from a no-growth company to a low single-digit company to a mid-single-digit company, and our future aspirations have always been to continue to increase. So the first thing is we just posted 1% revenue growth in 2Q. The first indicator, we have to show acceleration as we get into the second half of the year. Our guidance range, 4% to 5% should be noted right upfront. That low end of the range we put in as an anchor, an anchor so that we can show the investment community the level of productivity and operating leverage we have in this company that allows us to maintain earnings and maintain free cash flow at that low level. That low level says we take a business that just produced 1% up to mid-single digits, give or take, in the second half. That's not our aspiration. But that is an anchor as a range on how we put this in place. The high end, that 5%, that says we accelerate growth into the second half overall. Now 2 key components, KPIs underneath that, I would venture to say getting right back at the core of second quarter. Number one, the strength and confidence we have in our mainframe platform cycle. If we can maintain this at a high 120%-plus program to program, that is a tremendous indicator that will lead us to the high end of that guide range. The second is our software. And that software, when you look at it, at the high end of the range at 8%, that is the second half that's approaching double digits based on what Arvind said, the strength of our 80% high-value recurring revenue accelerating and a return to some normal level of closure rates of a strong pipeline in the second half. So those are 2 KPIs.”