International Business Machines

International Business Machines (IBM) was the leading office machine and computer business in the world, but in recent years it has encountered stiff competition. The company achieved its position in terms of office machines such as typewriters before also cornering the mainframe business computer sector. The company followed the trend toward personal computers and achieved a certain position in that realm as well, but its preeminence in all fields was challenged with the ascension first of Apple Computer and then of a variety of companies making IBM-clones that delivered the same power and features at a lower price. As a result, the company set out to reorganize and to downsize in order to be more competitive. Recent reports show that this effort has been unsuccessful, and the company now faces further changes if it is to survive. The company faces the need to make a decision regarding its future in terms both of structure and operation and must develop alternative strategies for addressing the changing nature of the computer business, its own competitive advantages and disadvantages, its dedication to new product development, its ability to fulfill its research and development needs, and so on. The company has a new leader, and this choice alone points in a certain direction for the future of the company. Yet, whether that decision has been made yet or not is uncertain.

IBM announced in 1991 that it would reorganize into a federation

for other market segments in addition to education now focus 100 percent on education. EduQuest is a "company within a company," with all EduQuest employees remaining IBM employees. This sort of change is expected to continue with other divisions. IBM also formed a company called Skill Dynamics, a wholly owned subsidiary that is expected to contribute $100 million or more in annual revenue. At first, the subsidiary is concentrating on teaching IBM employees and customers how to use IBM products, such as operating systems and programming languages, but plans call for holding future classes in training, management, and information technology. In addition to helping IBM pursue new areas of growth, the establishment of the subsidiary is intended to help IBM reduce its highly inflated selling and general administrative costs (IBM forms training unit," 1992). The research and development division, which many thought would be chopped up and parceled out to other business units, has instead reinvented the way it does research, with new management systems. New management systems have been instituted to speed the transfer of technologies from the research lab to the business unit, and the research division has been using other co

Category: Business - I