(By Jason Simpkins) While its chief competitor Oracle Corp. (Nasdaq: ORCL) is laboring to smooth out the wrinkles in its merger with Sun Microsystems Inc. (Nasdaq: JAVA), International Business Machines Corp. (NYSE: IBM) is streamlining its core business and fulfilling its mandate for innovation.

IBM – which had itself attempted to by Sun but balked at the hefty price tag – has been spared the regulatory scrutiny that comes with trying to merge to large global businesses. And instead of complicating its business, IBM is getting back to its roots in mainframes and virtualization – which means focusing on storing and processing data.

In fact, IBM recently announced the release of 10 new software products all designed to improve the performance and increase the cost efficiency of its System Z mainframe.

"We've seen improvements in scale in our zSeries mainframes running Linux, along with networking connectivity and bandwidth and virtualization," IBM Chief Information Officer Pat Toole told Forbes. "It's the hardware, the entire software stack and the services. In addition, we have a couple of green data centers in Raleigh and Boulder that dramatically improve their efficiency."

Toole said his company has consolidated from 150 data centers down to five and reduced the number of applications the company runs from about 16,000 to 4,500.

"I have to transform our processes and deliver operational excellence, top to bottom, to our employees. Business analytics is a top priority," he said. "We took out about $3 billion in costs over the last three years in shared services and global integrated processes."

Toole pointed to business analytics as a top priority. To that end, IBM earlier this month launched the world's largest private cloud-computing platform.