CIS9230 GlobalizationandTechnology TeamA

IBM Canada Ltd: Implementing Global Strategy

SITUATION ANALYSIS

1. Macro-environment

With IBMs increasing global expansion boosting the number of multinational companies it
is working with, new client needs emerge. In order for IBM to meet its goals of more
efficiently as well as more costeffectively serving the needs of the growing customer base,
the IT strategy must be aligned with the business strategy. A sophisticated and integrated
global CRM system tend to facilitate cost reduction, promote innovation which again will
enhanceproductivityandultimatelyleadtoahighercustomersatisfaction.

In this case, we can point out these variables to be relevant in relation to the new system
rollout.
Political/Legal: Local governmental regulations regarding data collection, data
privacy and information security laws (Schaeffer). Some countries have fairly strict
data retention and privacy laws to avoid marketing spamming and to protect its
citizens from identity theft. Hence, this may present a huge challenge to a CRM
systemwhosepurposeistoprovidedetailedinformationaboutallcustomers.
Economic: As developing countries are getting increasingly technologically
advanced,biggrowthopportunitiesforevenfurtherglobalexpansionarerelevant.
Social: Language barriers in certain countries can result in miscommunication. If
software is localized to local language, it is vital that translation is accurate.
Moreover, similarly to the political/legal aspect, customers in some countries are
reluctant to provide companies with specific information, presenting challenges to
the existence of a globally consistent CRM system (Schaeffer). Furthermore, IBM
enjoys a good reputation as a global IT company (Mohammadi). If localized IT
systems lead to inconsistency and unproductivity in terms of customer relations, the
wellestablishedreputationmightbetainted.
Technological: IBM is faced with an increasingly competitive environment and a
continuous pressure to maximize productivity. Competitors that already have
globally integrated CRM systems might be better equipped to meet clients' needs
more efficiently. IT infrastructure and advancement in some countries that IBM
operate in might also present an issue depending on the advancement of the new
system(Schaeffer).

CIS9230 GlobalizationandTechnology TeamA

Market and Organizational Pulse
IBM is a multidomestic company (Jain, 2013) that launched a global initiative in the year,
2000. The lowering of trade barriers, the rise of the developing world and the emergence of
the World Wide Web were unleashing the flow of work on a global scale (IBM, 2009). This
led to the adoption of new business models and a new form of the corporation itself, a
globallyintegratedenterprise.
In addition, distributed computing was replacing the client/server approach
evidenced with the advent of cameras, phones, cars, appliances, etc. facilitated by the
Internet. Processing power, data mining/ analytics of big data and cloud computing provide
astute inferences, making an even stronger case for a global company. There are two
basicdriversforthischangecustomersandthecostreductionopportunities.
IBMs customers are end users in medium to large sized organizations. In line with
its mission to provide leadership technology for the systems business, IBM developed a
strategy to help achieve its goals of helping clients succeed in delivering business value
by becoming more innovative, efficient and competitive through the use of business insight
andITsolutionsandprovidinglongtermvaluetoshareholders.(IBM,2009)
Since innovation had become a valued need of clients, IBM evolved to meet these
demands by transitioning from a computer hardware company to multinational IT Solutions
firm. To this end IBM adopted the aggressive growth strategy of acquisition leading to
natural diversification of its products/services. As of 2009, IBM differentiated itself through
its R&D efforts feeding into its exploration strategy. This was combined with an
exploitationstrategytomeetitsshorttermneedsprovidingadistinctiveedge.
Competition:
IBM first began its Canadian operations in 1917. It maintains an Ontario based
software research and development laboratory that is one of the largest in the world. IBM
Canadas main regional competitors are Cisco Systems Canada Co., HewlettPackard
Canada Co., and Dell Canada Inc. (Hoovers). Its global competitors are Accenture plc.,
HewlettPackardCompanyandMicrosoftCorporation(YahooInc).

CIS9230 GlobalizationandTechnology TeamA

5. SWOT Analysis:
Strengths
1. Brand reputation: significant market penetration throughout the world. Theyre a
market leader in terms of technological patents. According to Interbrand, IBM has
consistently ranked as one of the worlds most innovative, profitable, and
sustainablebrands(currently#3worldwidebehindCocaColaandApple).
2. First mover in cloud computing: IBM initially moved towards a strategy for cloud
computing in 2007, stating its mission to build clouds for enterprise clients and
provideservicesthatcomplementtheproduct.
3. A diversified business: IBM has organized its business into 4 divisions: hardware,
software,services,andfinancing.
4. Strong portfolio of acquisitions: approximately 80 companies acquired from
20012008.
Weaknesses
1. IBMs colossal size: ironically a source of weakness, in terms of orchestrating
organizationalchangeswhichallowthemtocompeteinaquicklyevolvingindustry.
2. Relativelyexpensiveserviceandsoftwaresolutions.
3. Focusonlargeenterprises.
Opportunities
1. Expand services and software divisions: open source trend, small/medium
businesses.
CIS9230 GlobalizationandTechnology TeamA
2. Globalization:canimproveprofitabilitybysourcingbusinessinputsmoreefficiently.
3. Increasingdemand:cloudbasedservices,analytics,bigdatatrends.
Threats
1. Increasingcompetition(e.g.Microsoft,HP,Intel,Sun/Oracle,Accenture).
2. Slowdownofworldeconomy.

CIS9230 GlobalizationandTechnology TeamA
REFERENCES

Hoovers.(n.d.).IbmCanadaltd.Competition.Retrievedfrom
http://www.hoovers.com/companyinformation/cs/competition.IBM_Canada_Ltd.f93928f1af21
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IBM.(2009).2009AnnualReport.Retrievedfrom
http://www.ibm.com/annualreport/2009/2009_ibm_annual.pdf

Jain,R.(2013).IntroductiontoGlobalization[PowerPointslides].Retrievedfrom Blackboard

King,C.(2009,March03).IBMandHP:NottheCompetitorsPeopleThink.Retrievedfrom
EcommerceTimes:IBMandHP:NottheCompetitorsPeopleThink

Mohammadi,Amir.(2008,Dec31).IBM.Slideshare.Retrievedfrom
http://www.slideshare.net/amir1980/ibmpresentation

Schaeffer,Chuck.(n.d.)GlobalCRMImplementationChallenges.Retrievedfrom
http://www.crmsearch.com/globalcrmchallenges.php

Vance,A.(2009,March22).RivalsSayI.B.M.StiflesCompetitiontoMainframes.NewYork
Times.Retrievedfrom
http://www.nytimes.com/2009/03/23/technology/companies/23mainframe.html?pagewanted=all

YahooInc.,.(2013,September26).IBMCompetitors|InternationalBusinessMachines
Stock.RetrievedfromYahooFinance:
http://finance.yahoo.com/q/co?s=IBM+Competitors