Ibm Decade of Transformation

vigorously to get into IBM in the first place, but once there they were some of the happiest, most productive, and

industry has been facing challenges. The industry is in a decline. This is because people may be

Watson, Jr. Thomas J. Watson, Jr. maintained the legacy and culture established by his father and helped to establish IBM as the world’s premier computer company with the introduction of the System 360 in the early 1960s. Watson focused nearly all of IBM’s people, resources, and capital toward the development and deployment of the System 360. That gamble paid off enabling IBM to garner over 90% of the exploding market for large computer systems. IBM’s near monopoly in the large computer marketplace provided tremendous growth and profitability for nearly 25 years. However, the personal computer revolution of the 1980’s (started by IBM, ironically) brought the glory days of IBM to an abrupt and near tragic end.

IBM was incorporated in 1911, in New York, as the Computer-Tabulating-Recording Company (C-T-R). Charles Flint organized the merger of three companies, Hollerith’s Tabulating Machine Company, Computing Scale Company of America, and International Time Recording Company, which became known as C-T-R. The newly formed company manufactured and sold a variety of machinery such as commercial scales, industrial time recorders, meat and cheese slicers, and tabulators, among others. They were first located in just a few major cities in both the United States and Canada, such as Detroit and Toronto. In 1914, Thomas J. Watson, Sr. joined the company, a leader who played a large role in helping shape IBM. On Valentine’s Day in 1924, C-T-R’s name was officially changed to International Business Machines Corporation (IBM) (IBM.com).

The merger was engineered by noted financier Charles Flint, and the new company was called the Computing Tabulating Recording (CTR) Corporation. CTR was incorporated on June 16, 1911 in Endicott, New York, U.S.A. This merger is just opposite of what happened in the case “Acme and Omega Electronics” where we learnt what changes an organization has to go through when its ownership changes.

1. IBM is capitalizing on the global warming-triggered revival of interest in nuclear power as an alternative to coal-fired plants 2. IBM has plan for Transferring itself to a innovation-centric globally integrated corporation that focus on new high profit high value added business and service 3. Using a very unique approach to engage their employees in an online intranet using its Jam technology 4. IBM is well known for its sale-centered business culture as it continues to hire its executives and managers from its sales force 5. 13 acquisition were completed, enabling IBM expand its software and service business 6. IBM is known to have more patent than any other American technology company 7. IBM’ s revenues increased 7% to $69.92B in 2007 8. Net income from continuing operations increased 9% to $6.46B 9. EPS has been increased steadily to $6.06 in 2006 10. ROE has a good reputation which means 33% in compare with actual rate, which almost 24%

To adapt to the fast changing pace of business, IBM CEO Louis Gerstner took the

IBM’s mainframe thinking- in terms of pricing and cost structure IBM tried to launch it in the middle market-and it bombed. It also blinded IBM to the much faster evolutionary path of the PC.

What factors led to IBM’s success during the 1960s and 1970s and its problems during the late 1980s and early 1990s.

Founded in June 1911, IBM has always been a leading company in the technology industry and at the forefront of innovation. It is a manufacturer of computer hardware and software, and also provides infrastructure, hosting and consulting services. Before the 2000s, IBM was the largest PC vendor in the world. However, the hardware sales have continually declined since 2000, and IBM sold its PC group to Lenovo in 2004, as well as its x86 Server Business in 2014. In the new era of the technology industry, IBM has faced the challenge to transit from a hardware manufacturer to a service company.

Consumers were no longer content with the technology that IBM offered in computer systems and growing complexities in the workplace brought the demand for real world solutions. IBM’s financial backing enabled Gerstner to market custom based programs and networks to individual businesses and offer a support team to accompany the hardware and software that his company sold. IBM’s deep pockets also provided the capability for research and design that few companies could match. “Under Gerstner, IBM's new strategy was to use processes and culture to regain advantage. Moving from proprietary standards to open standards, for example, was important to IBM's new strategy, and the ramifications for processes and culture were enormous. Using IBM's technological finesse to make solutions for customers in addition to just creating fancy technology was also a key to its new strategy. Customers wanted solutions, he said. They didn't want to know what their equipment ran on (Martha Lagace, 2002)”.

Nobody knows everything right off the bat. Some people have better instincts than others but most great leaders strive for self improvement. As a manager it’s your responsibility to educate yourself as best you can and apply that new found knowledge in your professional and personal relationships. Being a boss is not just about giving orders, it’s about communicating and encouraging innovation.

What new economic, technical, or sociological forces is the organization likely to face in both the near and long term?

During my research I have realized that IBM has made a great global footprint in the technology industry. There are so many different things that I could tell you about the early success of IBM I couldn’t even write about all of it. IBM is a fascinating company that has over 100 years of history and there success is unheard of. Competing companies really have no chance because of the level of innovation and research that goes into their technology.

It is a very technological industry, with a constant need for innovation and advancement. By improving their technology, efficiency increases and costs go down. New technological advancements are