IBM: History, Innovations and Future Strategy

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Background and History of IBM

Company character and features are usually defined with passing time. The general identity and public impression a company portrays to the general public is often an image which has been created with time and not an instantaneous occurrence. It is against this backdrop that it is necessary to develop a background understanding of a company before finally exploring the finer details of it.

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The general character of International Business Machines (IBM) has been developed in a period of about one century even as it provides its services to consumers in the field of handling information. The main reason for forming IBM was to gather, store, analyze, retrieve and eventually transmit data. It all began from the humble usage of tabulators which has developed to the contemporary use of a massive network of computer systems (Deitsch & Czarnecki, 2001).

The advent of information technology received a major boost from the early development processes of IBM throughout the past years. Today, IBM is shoulder high in the provision of information technology products and has magnificently revolutionized the operating standards of business enterprises, people and the wider corporate sector. The transformation and speed at which IBM is changing is relatively fast in comparison to other market players (Emerson, 1998). Besides, its scope of activities in the information technology sector is equally widening by the day.

When discussing the history of IBM, it touches on a variety of areas beyond just the manufacture of computers. In 1896, IBM was launched as a Tabulating Machine Company by Herman Hollerith. The company mainly concentrated on producing processing equipment which could work with punched card data. This type of technology was first tested way back in 1884. In fact, the 1890 census in the United States made use of this technology because it was necessary in processing the census results. The use of punch cards before the close of the 19th century acted as the foundation for the eventual establishment of a massive IT company called the International Business Machines (IBM) (Hensch, 2004). In 1911, the business was bought by Charles Flint.

The total value of this organisation at this time was 2.3 million dollars. After receiving 1.2 million dollars, Flint created a Computing Tabulating Recording Corporation which was later incorporated on the 16th day of June 1911. The event took place in New York. Before IBM could be formed, three companies went into a merger (Borghese & Borgese, 2002). One of these companies was the Computing Scale Corporation. Together with the Tabulating Machine Company and Time Recording Company, a trio merger was formed.

Flint was the key personality behind the financing of the trio merger and he also maintained a membership up to 1930. Thomas J. Watson Sr. later became the General Manager of Computing Tabulating Recording Corporation in 1914. Three years later, the company found its way into the Canadian Market. It had now changed its name to International Business Machine Co. Limited. Indeed, the role played by Watson led to the formation of what would later be referred to as IBM (Maney, 2003).

The introduction of punched cards which were rectangular in shape and eighty in number was initiated by IBM in 1928. This later became a regulated and unanimously accepted card which found application in tabulating and computing for several years that were to come. The contract for building the automated defence systems for the United States Air Force was later awarded to IBM in the 1950s. The SAGE interceptor control system contract was like an eye opener to IBM because it provided very critical information which made the company undergo technologically transformed operations having gathered vital information on transition, integrated video display, digital data among others. As a consequence, IBM took the initiative of building SAGE computers totalling to 56. Up to thirty million dollars was spent on building each computer.

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The mainframe business for IBM was already being consolidated during the 1980s. Furthermore, the breadth of the mainframes was expanded using ESA/390 as well as S/390. The rental base where the mainframes were initially stored was leased out so that the company could boost its revenue base. However, the management scrambled due to this change in spending. The disputes threatened to some extent the kind of monopoly earlier enjoyed by IBM in the Information Technology sector (Rumelt, Schendel Teece, 1994).

Hardware developments that are parallel in nature are the basis of the operating systems used by IBM. Dealing with operating systems was initially a profitable venture. Hence, these were perceived as additional sources of revenue.

Computer business has been the backyard of operations in IBM. However, the company has already played quite a number of roles besides computers in other industries. Currently, IBM has recorded and continues to enjoy multiple successes arising from its service and product offering which both the corporate and individuals have found to be useful in their Information Technology use (Smit, 2006). The planning of IBM international business is one of the main processes of the company. For example, IBM has a team of managers who together with the rest of employees form a vibrant team that oversees the execution of the company’s goals and objectives.

Recent developments at IBM

Maximo Asset Manager for Energy Optimization is one the newly released products at IBM. This product is installed in data centres to assist in the monitoring of how much energy is being consumed. It is a research based functionality which has been developed by IBM Tivoli. A similar recent development is that of Maximo spatial Asset Management Product (IBM, 2010). This product has the capability of combining a management system based on an asset together with Geographic Information System.

This system is capable of providing users with metrics that are of real time. Besides, users are capable of accessing all the historical record of data which they are interested in. In addition, full service management ability is also provided by the system. Data obtained from this system can assist entrepreneurs to make quick, proactive and accurate decisions. Data regarding temperature and humidity alongside other additional information can be captured and analysed by this system. Real-time data captured using IBM Tivoli is highly precise and can be used to make accurate management decisions. The management of IBM’s international activities is done at the regional level.

IBM’s Jeopardy Playing Program

This is one of the latest developments in the innovations of IBM. The company is currently working to construct a computing system that can not just comprehend questions asked but also answer those questions as quickly and precisely as possible. The questions which can be answered by this computing system are rather complex and the challenge in this case is perceived to be beyond a simple game. It has been branded jeopardy! It can handle a wide array of knowledge derived from history, pop culture, and government just to mention a few. In addition, there are riddles and other complex thinking which human beings have always have the knowledge of compared to computers.

The ability of the human mind is expected to obtain a tough rival from jeopardy! This is because the application will be fed with a lot of content which has only been the preserve of human beings. This computing system also called Watson, having been named after the founder of IBM is still under development and the work on it began more than three years ago. The ability to process the right answers with confidence and desired speed is the main strength behind jeopardy! Watson will operate independently just like human beings. External assistance such as internet connection will not be part of Watson.

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Issues of the IBM’s internationalization process

IBM has several internationalization processes which enable it to operate smoothly and successfully on a global scale. Through internationalization, applications are made to work without making use of seams. Besides, the user can use the language which is most preferred. Hence, internationalization of processes at IBM has been one of the success stories which have made the company maintain market leadership in the provision of Information Technology services (Cortada, 1996).

Internationalization may apparently be a very tough and demanding task for an organisation like IBM. There is a lot which is involved in the process of internalisation that ranges from skill deployment to programming. In addition, the need to adequately translate certain languages comes on board and which requires much expertise to be put in place. It is due to the demanding nature of the process of internationalization that some distinct processes have been adopted by IBM to ease down the global operations of the company. The three main internationalization processes which have been put in place at IBM include planning, designing and developing.

To begin with, it is imperative to note that the IBM globalization team has the mandate of defining and maintaining internationalization strategies alongside other requirements for the company such as global social responsibility and products and services offered in the market (Garson, 1999).

As part of the planning process, there are a variety of issues which have been into consideration by the global team. For instance, intensive planning on expanding the market for IBM products and services is top in the list. Besides, planning process that deals with international operations, workforce and immigration are all enshrined in the process of planning for the IBM Company (Rea & Kerzner Publishing, 1997).

The planning aspect is important in this undertaking due to the fast pace the business world is changing. In addition, it is sometimes not easy to predict the market dynamics and hence it is only through stringent planning that such unknown market eventuality can be managed well. Besides, the competition factor is critical for the success of IBM. It is imperative for IBM to keep the competitive pace in order to remain competitive in this volatile and most dynamic Information Technology world.

The planning of IBM operations also entails e-business which the company takes pride on by acknowledging that it is beyond a mere future vision for IBM. The company has already laid down workable plans on the application of e-business as part of its competitive platform (Horn, 2001).

Hence, IBM is already living the dream of carrying out its e-business on a global scale. Surprisingly, the e-business plan has worked out so well since it was launched about ten years ago. The company is currently boasting of high profitability, innovation and effective competition due to planning that was carried out ten years back. The business transformation which has been experienced at IBM has been attributed to good planning which touched on crucial components of globalization or internalization. Through the latter practice, IBM has been able to plan for incisive innovation in technology, corporate culture as well as practices in businesses (Ceruzzi, 2003).

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The globalization team also aims at a proper planning on how to communicate well alongside following the other normal rules. One important planning which IBM has always endeavoured to achieve is the language barrier as it attempts to communicate to its customers (Jansson, 2007). Hence, planning is not just underway but has been in place for a considerably long period of time in order to cater for different language translation so that the company can reach out to its customers.

The second most important internationalization process at IBM is designing. Through designing, the company has managed to sustain the preferences of a wide array of customers throughout the world. There are a variety of designs that IBM uses when branding its products and services. For instance, the persistent growth and development of such products like Open Source and Linux has been a possibility through the internationalization designing process. The process of designing certain software by IBM like that of Open Source often entails a lot put into consideration.

IBM designs considers such components such as input display, time, phone number, currency, calendar and the format of the print just to mention a few designing options. OpenI18N has also been designed to carry out advanced tasks such as the ability to edit shapes, combining different characters as well as directional writing. Moreover, the software is designed to run on a multilingual input system.

The next type of designed product from IBM is the International Component for Unicode (ICU). This is a very important Unicode software. It has a complete range of services which are all targeted at giving support to the process of internationalization. One area of service where International Components for Unicode can be applied is in the server environment. Its main purpose is the provision of a cross platform C as well as that of Java (Renesse, Birman & Vogels, 2003).

Another On Demand Business application which dwells on design process of the product is the Unicode. It has both customers and those who support it all over the world. Consumers of this product can use multiple scripts to read and also write. According to IBM, globalizing business applications cannot be ignored by business operators if linguistic preferences of customers are borne in mind (King, 2009).

The design process of this product allows users to acknowledge certain scripts because they have encoded in a variety of ways. Users with varying tastes in both linguistic and culture have been catered for by business due to the compulsion by the internet. Users are now in a position to enjoy the benefits of multi-linguistic and cultural variations.

The third most important internationalisation process carried out at IBM is the development of the various products offered by the company. Both the International Components for Unicode (ICU) and Unicode itself belong into this of the processes in developing phase at IBM is the JavaScript. It is applied in many websites as a language for programming.

Still under developing process at IBM, globalization is a viable tool for eclipse. Indeed, should any success be recorded in e-business, then globalization in the developing process at IBM is crucial. The development of software that are standard according to IBM rules imply that developers have the responsibility of making sure that the software is compatible with a variety of users who use different languages (Giachetti, 2010).

This was a discovery made at IBM that most software were initially developed with the English user in mind but ignored other languages. Hence, IBM proposes that such software need to undergo internationalisation or better still should be globalised in order to face the reality of the globe. By so doing, the software will have met the IBM standards.

Hence, software developers are now trying to internationalize their products so that they can remain relevant in the market. There has always been a need for software products to be compatible to a variety of users. In order to attain these requirements, some special tools are required without which it may not be easy to meet the requirements.

There are several benefits which can be derived from the IBM Globalization Tool for Eclipse. The benefits of using this tool are especially evident when J2EE applications are being internationalized (Drucker, 2007). Firstly, developing process which makes use of this tool takes a very short time. In other words, about 80 percent time is saved. This is the time required to remove a string which is of hard-code. Secondly, when changes are to be applied on the relevant files, developers will not spend a lot of time working on the same. The tool saves about 50 percent of the time required for the development process.

Future Strategy for IBM

The immediate future strategy for IBM is to put in place a grid computing system. A grid system was recently installed by the organisation at Charles Schwab. The processing time was reduced by the system on an application based on wealth management. The processing time was reduced to mere 15 seconds from 240 seconds (Dimitriou & Thompson, 2007).

The executive officers at IBM are currently laying down strategies for a better operating future. The organisation is thinking of dealing with hardware, a section which has not been profitable in the past years mainly owing to the decline in prices. In fact, the organisation is thinking of once again dealing in hardware components so that it can maintain its industry position as one of the best vendors of hardware components in the near future (Vissak, 2009).

The technology strategy for IBM is currently looking forward to developing a model based on hardware development. Grid computing forms the background of this hardware technology. This is a form of technology based on architecture and aims at attaining the same computational problem and at the same time using several computers. The min plan of IBM under this new technology is to develop reliable software alongside computers which are all compatible with the gridding system.

The Terascale facility distributed by IBM is intended to make use of a grid computing system. The system is expected to increase the speed of calculation by a significant margin. For instance, about 13.6 trillion computing problems in form of calculations are expected to be done effected by the grid computing. The connected computers are expected to increase speed up to 1000 times more than it has been (Muffatto, 2006). The chess-playing Deep Blue machine which belongs to IBM has a lower speed than this.

However, the main problem still remains to be the market end of grid computing technology. The system appeals to a small section of consumers who conduct huge amounts of calculations. This forms part of the problem fragment of developing this technology in spite of projected decent profit margin.

Main users of grid computing technology are those carrying out scientific research, government agencies, academicians as well as those in the engineering sector. Nevertheless, IBM does not seem to relent on its quest to be the market leader in selling grid computing technology. The organisation is currently targeting the corporate sector (Anon. , 2009). In order to achieve this, IBM is negotiating with the corporate mainstream to permit it to operate within their platform. This may not be an easy task to accomplish. As a result, IBM is attempting to create platforms in the corporate sector through the simpler use of computers, easy management, and ease in operation in addition to affordability due to reduced costs.

The main reason why IBM has decided to move to grid computing technology is due to the fact that the old systems usually encounter a myriad of bottlenecks especially when carrying out massive and complicated procedures. The inability of the common computing technology to handle lump sum processing tasks has called for the need to adopt grid computing model through which calculations can be carried out faster and also with high precision ( Anon., 2010). The initiative being developed by IBM of developing grid computing model has significant consequences in the sense that its breakthrough or failure will be a major determinant if the organisation maintains market leadership or not.

The initiative to develop grid computing is not a reserve of IBM only. The grid computing initiative has been announced by most major market dealers. For instance, the Superdome system used by Hewlett-Packard is making use of the grid computing system in its application. Another similar application called One Grid engine is being used by Sun Microsystems (Smock, Rudzki & Rogers, 2007).

Nonetheless, none of the major computer vendors has taken the broad initiative of solving massive and complicated computing problems like IBM. This organisation has taken major steps and laid down strategies of pushing the new technology. Grid computing model is top in the priority list of IBM future strategic growth. This is why it is developing the right model into the growth of the new computing technology so that it can emerge as the leader in computing market (de Goey & Bonin, 2009).

The long term strategy of IBM is to make sure that it captures both the current and future grid computing market. It is also important to note that IBM has identified grid computing mode as one of the most potential growth points which if well harnessed will lead to profitability in the future. Computer products which are grid enabled will also be part and parcel of the entire initiative. One main benefit to customers who embrace grid enabled products is that they will be able to handle and manage their computing problems with lots of ease (IBM, 2009).

Besides, the grid system will primarily aim at cutting down computing costs and as a result, business organizations will be in a position to lower their Information Technology budgets. The budgets will definitely go down due to the application of hardware and software which are integrated into a single system.

It is also possible for IBM to use grid computing model as one of its viable competitive edge platforms owing to heavy investment it has already made in the initiative. This will work well especially if the strategy turns out positively. The prospect for IBM Company is good as far as the development of grid computing is concerned. For instance, the central control can only be provided by IBM since it is the only company which has the most relevant pieces which can be used to support the system. The availability of such a central control system puts IBM ahead of its competitors (Korzeniowski, 2008).

Nonetheless, the success of IBM in attaining the grid computing goals is facing a myriad of hurdles which has to be cleared. To begin with, it should be noted that the whole initiative lies behind hardware vending which has been facing a downturn in revenue in the recent past. The quantity of supplies is not constant and keeps on dwindling (BNET, 2008). However, servers are still competitive in the Information Technology market. Consumers have been enjoying lower prices due to the decline of the same from suppliers as market competition stiffens.

Alliances and recent activities

In order to grow at a faster rate, IBM is currently targeting quite a number of industries which it can form alliances with. Government agencies as well as the financial services sector are on this target list. Besides, the aerospace, life sciences and automotive industries are being eyed by IBM as potential future alliances. A recent development is the by IBM was the installation of a grid computing system which took place at Charles Schwab.

This installation significantly reduced the time taken to process data on a wealth management application. However, grid computing technologies which require general purpose use are not widespread and possibly require to be expanded for optimal application. Most grid applications devised by IBM tends to be more specialised even in environments that are commercial in nature.

Proprietary technology has often been the main point of consideration whenever IBM brings into the market and promotes a new hardware or software products. The grid computing technology has that clue (Blomstermo & Sharma, 2003). The integration of both the hardware and software as one package pushes consumers to buy both components from IBM. Although this may appear to be a pushy sale strategy, the consumer end has the benefit of obtaining the optimum processing power from IBM. Hence, the maximum power to process data will only be possible when a consumer purchases both the hardware and associated software.

To the IBM company, this initiative will boot the sale of both of its hardware and software (IBM, 2010). Since this impression may not be appealing to new consumers who may find it cumbers some to double spend, the adoption of grid model is being promoted by IBM alongside other supplying companies. This market promotion of the grid computing technology has also been aiming at ensuring that the model proliferate in the market and is widely accepted by consumers.

The ability to persuade consumers to embrace grid computing technology has not been an easy task though and as a result, IBM is forming alliances with other potential market players as a strategy to initiate consumers to use the product. For instance, the Open Grid Services Architecture is currently being supported by IBM. This refers to standards which have been developed to assist in promoting the multi vendor architecture for the grid (Canzer, 2009).

In order for the IBM strategic plan for the future to succeed, it will go beyond its own initiative to push for the sales of the grid computing technology. The main demerit remains to be the integrated use of both hardware and software parts from IBM in achieving the highest processing power (Anon. 2008). Hence, it will be necessary for IBM to convince software manufacturing companies to produce software which are compatible with hardware in its grid computing system. The grid computing architecture is currently facing a difficulty of programming tools as well as management systems which are compatible with it. However, this challenge can be overcome if the company adopts a robust plan of selling out the idea to prospective consumers.


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