Introduction IBM International Business Machines Corp Essay

Submitted By kinchouk
Words: 3413
Pages: 14

IBM, International Business Machines Corp., founded in 1914, the United States, the world's largest multinational industrial information, now has more than 20 million employees worldwide, operations in over 150 countries and regions.
This report is to analyze and investigate the business culture and strategy of IBM.It has four sections including External environment,Organization culture,Business strategy and change.It analyzes the SWOT and PEST and some management problems for IBM。

1.0 External Environment
1.1 PESTLE analysis
PEST is a kind of Macro-environmental analysis model of the company which is so-called Political, Economic, Social and Technological. This kind of environment is the company's external environment which is not controlled by the company generally.
Political factors are basically to what degree the government intervenes in the economy. Political factors may also include goods and services which the government wants to provide or be provided (merit goods) and those that the government does not want to be provided (demerit goods or merit bads). (
In the case,60 years ago, the U.S. government manipulated the market. The organization who used the computer was the government and the organization who researched and developed the computer was the government as well. In 60 years later, the government created the market for private companies and invested a few computer companies. A half of IBM investment was from the government. In 1963, the government withdrew its investment from IBM; however, 30% of the fund of IBM research and development projects is still from the government.
Economic factors include economic growth, interest rates, exchange rates and the inflation rate. These factors have major impacts on how businesses operate and make decisions. (
In the case,The government did the forerunner for the computer market and dominated the market. The government had created the market for the computer and computer technology. The government made the computer market to be standardized by purchasing chips. In this way, all walks of life were using circuits.
Technological factors include technological aspects such as R&D activity, automation, technology incentives and the rate of technological change. They can determine barriers to entry, minimum efficient production level and influence outsourcing decisions. (
In this case, the transistor (1956) in the early 50 s and the invention of integrated circuits (1959)
At the same time, Japanese low price products entered the American market.
Therefore, IBM created the industry standard.
With the rapid development of science and technology, the advanced technology greatly shortened the product life cycle. Rapid update made IBM face the problem of a large number of inputs and having to research and develop new products until old products were recycled back.
Legal factors include discrimination law, consumer law, antitrust law, employment law, and health and safety law. These factors can affect how a company operates, its costs, and the demand for its products.(
In this case, the antitrust litigation was the huge influence to IBM brought by legal factors. After the procedural law being passed, other companies had opportunities to access to the computer market, which was a big step of the development of the electronic industry. As a result, IBM was made to be in a passive state.
1.2 SWOT Analysis
SWOT (strengths, Weakness Opportunity Threats) analysis approach, which is also called Superiority Weakness Opportunity Threats or Advantage and Disadvantage analysis approach, is used to determine the strength of the company itself, weakness, opportunity and threat, so as to organically combine the company’s strategy, external environment and internal resources together. SW is the