Summary of IBM Case Study
This is the introductory part of the case study. It precisely presents the challenge that Peter Silvanovich needs to solve. IBM is rolling out a new global application and IBM Canada needs to promptly switch from its locally supported Customer Relationship Management (CRM) software application to the new software application.
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After the company made appropriate training for the for implementation of the new global software application, three units in IBM Canada presented their cases against an immediate switchover and requested a delay of between three to six months (Compeau and Mark 1).
This section gives the history of IBM right from its incorporation on 1911 in New York. Bulk of this section reviews how the company has evolved from manufacturing computer hardware to being a great information technology solutions firm. With branches in more than 200 countries, the company adopted a decentralized system of operation (Compeau and Mark 2).
IBM Canada Ltd.
IBM Canada is a key country unit to IBM. It was established in 1917 and has grown to be significantly strategic to IBM’s operations. IBM Canada houses the second largest IBM software laboratory. It also has a state of the art manufacturing unit.
IBM’s Global IT Transformation
This section shows how IBM was to go about centralizing some of the functions that were under different country units in a bid to cut down on costs. This was to be accomplished by rolling out common software applications to be used across the globe instead of the different software applications that were being used in each country unit. This transformation led to a consolidation of 155 data centers to five and reduction of 16,000 software applications to 4,700.
The Application Review Process at IBM
In order to ensure that the global application roll out effectively, two review bodies were set up. These were the Investment Review Board (IRB) and Application Review Board (ARB). While the IRB was in charge of rolling out of the global applications, the ARB ensured that the transition from country unit based applications took place effectively to the global based transitions (Compeau and Mark 12).
Global Strategy, Local Implementation
This section examines the challenges which come with rolling out global applications. It is noted that country units have to incur some expenses on these roll outs. The process is not described as an easier one but one that may cost IBM Canada up for US$ 4.6 million in terms of consultants’ time, costs of launch, and customization costs.
Assessing the Assessment Process
This section examines the limitations that the local software applications are encountering as a result of the global roll out of software applications. The section also expresses concerns on how some of the local software tools were to be funded since the funding allocation had been moved to the IRB. Still concerns are aired in this section in regard to the effectiveness of the adversarial process in funding projects.
This is last section. Silvanovich is supposed to develop a solution to the challenges that confronts him.
Vision, Mission and Value of IBM
IBM’s vision and mission are contained within its values. IBM engaged in a re-examination of its core values in 2003. It invited all its employees to make a contribution on ways they thought could make the company efficient. 319,000 employees participated in this exercise through the IBM intranet. The new values formulated are as follows:
- “Dedication to every client’s success” (Palmisano 1)
- “Innovation that matters, for our company and for the world” (Palmisano 1)
- “Trust and personal responsibility in all relationships” (Palmisano 1)
Important and Updated Information about IBM
IBM strives to be the leader in the provision of IT solutions. It has been striving to do this by making the world a smarter planet. It is doing this by continuously working to change the “paradigm from react to anticipate” (IBM 1). This is being done in three ways – “using analytics in decision making as opposed to instinct, imparting knowledge instead of amassing it, and seeing clients as clients and not as market segments” (IBM 1).
According to IBM, use of analytics is very important as it ensures that what is to come is known before it happens. This is significant because it makes it possible to undertake the necessary arrangements. IBM also aims at helping businesses to understand their clients better such that they can give customized services and hence become more competitive in a smart manner (IBM 1).
In order to ensure that the Smarter Planet concept works, IBM has collaborated with more than 600 organizations all over the world to ensure that they apply the concept to their benefit. The areas which this concept has been tried and implemented in include banking, communications, education, electronics, energy and utilities, governments, healthcare, insurance, media & entertainment, oil and gas, retail, and transportation (IBM 1).
SWOT Analysis and SWOT MATRIX
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- It is a leading provider of IT solutions because of its system and technology which is of the state of the art.
- It has a good internal control system which has so far controlled and managed well its sub units spread out in other countries.
- Its recent centralization attempts on some tasks have saved it a lot of money.
- Its huge size makes it hard to quickly adopt changes.
- Big companies often are confronted with diseconomies of scale
- It has a wide market presence and therefore assured of quick sales
- It has strong talent base which it can use to develop cutting age technologies which will give it a competitive edge against competitors
- Due to its talent base, it is assured of long term benefits
- There are a number of IT companies which compete with IBM, for instance Dell, Accenture among others.
- A bad world economy will affect the sales of IBM
- It has a large employee base which greatly reduces its profits
The SWOT matrix of IBM is as follows:
to achieving objective
to achieving objective
|Internal Origin |
(attributes of the system )
|– It is a leading provider of IT solutions because of its system and technology which is of the state of the art. |
– It has a good internal control system which has so far controlled and managed well its sub units spread out in other countries.
– Its recent centralization attempts of some tasks have saved it a lot of money.
|– Its huge size makes it hard to quickly adopt changes. |
– Big companies often are confronted with diseconomies of scale
|External Origin |
(attributes of environment)
|– It has a wide market presence and therefore assured of quick sales |
– It has strong talent base which it can utilize to develop cutting age technologies which will give it a competitive edge against competitors
– Due to its talent base, it is assured of long term benefits
|– There are a number of IT companies which compete with IBM, for instance Dell, Accenture among others. |
– A bad world economy will affect the sales of IBM
– It has a large employee base which greatly reduces its profits
IBM Strategy Now and in the Future
IBM has come up with a strategy it calls the Smarter Planet concept. In this concept, the company has been developing smarter IT solutions which are more efficient and specifically aimed at identifying threats and future attacks in time before they strike. The company aims at working closely with its clients in different sectors of the economy to improve on their efficiency by ensuring that their businesses are well monitored.
So far the company has integrated this concept in its risk managements solutions, business resilience solutions and security solutions. IBM believes that this is an era of smartness and therefore the Smart Planet concept is relevant in helping business to lead and win in their respective markets (IBM 1).
Conclusion and Recommendation
IBM is a great company whose talent base can greatly help it to move ahead of its competitors. Its move to centralize some of the tasks to the senior management away from country units has already benefited it. The company needs to make concerted efforts to ensure that it keeps on cutting down costs. It should also channel more resources to IT projects. This will enable it to be always ahead of its competitors as it will be possible for it to develop IT solutions which addresses relevant issues in the market.
Compeau, Deborah and Mark, Ken. IBM Canada Ltd.: Implementing Global Strategy. Ontario: IVEY Publishing, 2010. Print.
IBM. “About IBM.” International Business Machine, 2013. Web. <https://www.ibm.com/ibm/us/en/?lnk=fai-maib-usen>.
Palmisano, Samuel. “Our Values at Work on being an IBMer.” International Business Machine, 2013. Web.