l IBM and IBM-compatible personal computers.
Apart from competition within its own market, IBM also faced stiff competition from the only company that survived and even thrived as a competitor with a different technology stance, Apple. At the end of the 1980s, Apples and IBM-compatible machines dominated the personal computer market, with additional competition arising in the form of laptop and notebook computers.
IBM also finished the 1980s in a financially weakened condition compared to the shape that it was in at the beginning of the decade. Its stock, which reached as high as the 130s during the late 1980s, fell in the early 1990s to the low 50s (Berlind, March 7, 1994, p. N12). In what the industry saw as a significant departure from its tradition of long-term employment, the company announced that it was laying off workers across all divisions. The company divested itself of unprofitable operations, selling one plant to its employees (Bianchi, January 1994, p. 28).
Faced with this situation, the company recognized that it could no longer depend on its traditional core business, the manufacture of equipment, to provide it with long-term success. Companies have long recognized that purchasing or leasing expensive computer equipment contains after-market costs, such as maintenance and repair, that can be significant. Since most companies' business depends on the integrity of the information that is stored within their computer systems, adequate maintenance and timely repair services are necessary if companies are to remain competitive.
In one case, a bank suffered a breakdown in its computer operations that extended over four days. As a result, withdrawals and deposits were not posted accurately to customers' accounts, with the result that some customers' checks bounced when they should have cleared, and some local merchants refused to accept checks from customers whose accounts were with the bank in question (Iida...