International Business Machines By Robert Muth Real-World Case Pg. 597

AGENDA  Case Summary  IBM Outlets  Conversion to E-Business  Strategy to Conversion  Success Factors  Future Trends  Conclusion

Case Summary  IBM has been a strong force in the Computer Hardware Industry since the 1940’s despite increased competition  IBM changed to an E-Business strategy in 1999  IBM website IBM

Case Summary (cont. 1)  To carry out the transformation, IBM created the Enterprise Web Management branch  EWM goals –To lead IBM’s strategic transformation –Help IBM’s business units become more internet suave –Establish the strategy of IBM’s internet site –Record information created by the website

Case Summary (cont. 2)  The Transition –Simplification of internal business processes –Streamlining of processes –Increased efficiency –Results returned a profit for IBM –Now collaborates with suppliers, online purchasing, and knowledge/management based applications –Reduced cost and improved purchasing

IBM Outlets  Hardware: servers, storage, printing systems, retail store solutions  Software: connect OS’s, business procedures, and applications seamlessly  Services: comprehensive IT services to reduce costs, increase productivity, and assert competitive advantages  Financing: provider of financing and management services

IBM Outlets (cont. 1)  Research: creating innovative technologies with leading-edge solutions  Technology: develop, market, and deliver leading chip technologies/services

Pre-Transition  Procedural Conversions  Smoothing out business processes –A simpler procedure is quicker and more efficient, both qualities are needed for successful E-Business

Transformation-Initiation  IBM started moving toward being a comprehensive E-Business  Carried out online business transactions through: –Internet –Intranet –Extranet  With suppliers, Business Partner Network, and employees

Transformation-Formulation  Strategy to fund only E-Commerce projects that promised high Return on Investment  Investing in many projects increases chances of success in comparison to only investing in one low-risk project

Transformation-Implementation  Carried out by the Enterprise Web Management branch  EWM aided in converting the different business units to Internet using domains

Success Factors  Investing in multiple projects/areas  By doing so, increased chances of success  Previous and still existing brick-and-mortar business to base the extension of E- Commerce off of

IBM’s Future  Continue to become more heavily involved in E-Commerce  The process of the conversion has improved speed and efficiency of the company  Process has also increased profits

Industry Trend  Computer Hardware continues to increase in importance  IBM holds a large customer base and has high customer loyalty within the industry  IBM’s flexibility continues to gain value within the industry  Main competition is Dell  Second strongest competitor is Apple, with less than ¼ the market cap as IBM

Conclusion  IBM will remain a major competitor in the Computer Hardware Industry  IBM will continue to adapt to the changing global environment  IBM could try to embrace change a little more readily, rather than waiting for others to do it first