IBM will celebrate its 100th birthday on June 16. The current issue (June 11-17, 2011) of The Economist has a special section for the birthday - - 1100100 and Counting. The article is a great history lesson on IBM, while covering the recent changes regarding the focus of the company. Since 2002, the success of IBM has been a function of three strategic elements - - (1) Maintain its connection to its customers. This is one of the dominant features of IBM for the last 100-years, (2) IBM has become much less hierarchical and more open. IBM is a champion of open standards and open-source software, and (3) IBM tries to ensure that the output of its 3,000-strong research division remains relevant to its business.
Consider the closing of the article - - a nice summation for a birthday card:
IBM, 100 years after its incorporation, appears to be fairly well in control of its destiny. Yet its history can read as the result of business constraints as much as of managerial genius. From the beginning, as a maker of complex machines IBM had no choice but to explain its products to is customers and thus to develop a strong understanding of their business requirements. From that followed close relationships between customers and supplier.
Over time these relationships became IBM's most important platform - - and the main reason for its longevity. Customers were happy to buy electric "calculating machines", as Thomas Watson senior insisted on calling them, from the same firm that had sold them electromechanical predecessors. They hoped that their trusted supplier would survive in the early 1990s. And they are now willing to let IBM's service division tell them how to organize their businesses better.
The human platform has an important drawback: it is expensive to maintain and to extend, says Carl Claunch of Gartner, a market-research firm. That also means, however, that it is costly for others to replicate or invade. And given the complexity of the world and how much of it is still to be digitized, IBM's human platform looks unlikely to reach its limits soon. Perhaps not for another 100 years.
One a year IBM produces a technology outlook - - you can access the 2011 version at IBM Global Technology Outlook 2011.
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