IBM Company Profile Company history: IBM was founded in 1910 by Thomas J Watson, Sr. in Endicott, NY and officially became International Business Machines Corporation in 1924. In the 1960s IBM ‘unbundled’ its computers to essentially create markets for software and hardware components, leading to the proliferation of computer technology. IBM launched the PC in 1981. In order to offer a better product it sourced PC’s components to Intel (processor chips) and to Microsoft (operating system). IBM’s will to innovate allowed the PC to find millions of users all over the world. Unfortunately for IBM however, the collaborative spirit enabled the entry of dozens of competitors into a business that IBM dominated. (Good for consumers, bad for IBM’s bottom line). In early 1993 IBM was on the brink of bankruptcy when CEO Lou Gerstner took control. Rather than adopting the GE conglomeration strategy - the direction IBM appeared to be heading - he pulled the IBM businesses closer together to offer integrated business solutions to its clients. Gerstner believed that IBM’s unique advantage was its ability to provide enterprise-wide technology solutions for hardware, software and services. Gerstner resurrected Big Blue and remains a legend around Armonk, NY. Currently IBM is led by CEO Sam Palmisano who has focused on positioning IBM as a catalyst for client innovation. I. Industry: Information Technology a. Offerings i. Hardware: servers, semiconductors, storage, printing systems, retail store solutions (self-check out) ii. Software: business integration, e-commerce, data management, networking, security, systems management iii. Services: 1. Global Technology Services: application management, infrastructure and systems management, maintenance, networking, outsourcing/hosting, service-oriented architecture, storage, tech support 2. Global Business Services: applied technologies, financial management, human capital management, marketing/sales, strategy/change, supply chain iv. Financing: hardware, software, services v. Research: chemistry, computer science & engineering, electrical engineering, materials science, mathematical sciences, physics, services sciences management and engineering, systems b. Competitors i. Hardware: HP, Dell, Cisco, Xerox, Sun Microsystems ii. Software: Microsoft, Oracle, SAP iii. Services: Wipro, Infosys, Accenture, EDS Financials: a. Stock price
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i. Current: 82.84, 52 wk range: 72.23-89.94, P/E: 15.64, EPS: 5.30 b. Profitability i. ~9B (9.5% profit margin), 5-10% growth c. Revenue i. 89B, flat – total assets: 140B III. Strategy – business model – IBM reduced its investment in hardware and has thrown its weight into higher margin services, which now make up over 50% of IBM’s revenues a. Mission statement: At IBM, we strive to lead in the invention, development and manufacture of the industry's most advanced information technologies, including computer systems, software, storage systems and microelectronics. We translate these advanced technologies into value for our customers through our professional solutions, services and consulting businesses worldwide. b. Strengths – breadth of expertise, very strong long term financials weaknesses – creating top line growth, becoming a globally integrated enterprise, opportunities – expanding into emerging markets, threats – losing share to non-US companies like Infosys and Wipro c. Values: 1. Dedication to every client’s success 2. Trust and personal responsibility in all relationships 3. Innovation that matters – for our company and for the world. Human Resources a. Population i. 341,750 full time employees (~3,000 HR professionals) b. Departments i. Workforce Relations, HR Strategy, Learning, Talent, Workforce Research, Compensation & Benefits c. Programs i. HRLDP d. Recruitment i. Bob Calamai 1. Behavior-based interview questions (adaptability, teamwork, problem solving with a technology tool) GBS a. Strategy & Change b. Human Capital Management i. Departments 1. Process transformation 2. Learning & Development 3. PeopleSoft ii. Recruitment 1. Melissa Smith 2. Behavior-based interview questions (teamwork, decisionmaking skills)
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