Comilla University: Prepared by

COMILLA UNIVERSITY
DEPARTMENT OF MARKETING
TERMPAPER
PRINCIPLES of MANAGEMENT
Managing Strategy and Strategic Planning: IBM

Group of Companies
PREPARED BY
Sheikh Mariam
Id: 12007036
Managing Strategy and Strategic Plan:
Facebook Group of Companies
International Business Machines Corporation (IBM) is an American multinational technology company

headquartered in Armonk, New York. It was founded in 1911 in Endicott, New York, as the Computing-
Tabulating-Recording Company (CTR) and was renamed "International Business Machines" in 1924.
IBM is incorporated in New York and has operations in over 170 countries
Given that the company is over 100 years old it is no surprise that it has had to adjust
to different technological trends throughout the decades.
The company is now transitioning from being an infrastructure player to one that is
more cloud and data driven.Nicknamed ‘Big Blue’, the company offers cloud
products in the shape of Bluemix, a SoftLayer cloud, and data analytics, or cognitive
computing capabilities, with the Watson supercomputer.
IBM has seen mergers and acquisitions as a way to diversify its and expand. Here is a look at
some Of the well-known acquisitions it has made. The following is a partial list of IBM
precursors, amalgamations, acquisitions and spinoffs.
Acquired on Company Business

July 8, WDG IBM to Acquire WDG Automation to Advance AI-
2020 Infused Automation Capabilities for Enterprises.
June 15, Spanugo US-based provider of cloud cybersecurity posture
2020 management solutions.
July 9, 2019 Red Hat Provider of open source software and solutions.
June 15, 2018 Oniqua Holdings Pty Intelligent maintenance repair and operations
Ltd. (MRO) solutions.
May 3, Armanta, Inc. Aggregation/analytics software for financial
2018 services firms
October 5, Vivant Digital Innovation Consultancy
2017
XCC (division of Collaboration software
May 31, 2017 TIMETOACT)
May 2, 2017 Verizon -cloud Cloud services
service
February 3, Agile 3 Solutions Information security
2017
October 27, Sanovi Hybrid cloud recovery
2016 Technologies
September 29, Promontory Financial Risk management and regulatory compliance
2016 Group
June 1, EZSource Application discovery and dashboard visualization
2016
March 31, Blue Wolf Group LLC Salesforce systems integrator and professional
2016 services
March 18, Optevia Specialist provider of Microsoft Dynamics CRM
2016 based solutions and associated services to the
public sector
February 29, Resilient Systems Cyber security, incident response platform
2016
IBM has undergone a large number of such during a corporate history lasting over a century; the
company has also produced a number of spinoffs during that time.
IBMs Mission :
The following points are the main components of IBM’s mission statement:
1. Leadership in creating, developing and manufacturing the most advanced

information technologies
2. Worldwide network that translates advanced technologies into business value for
customers
3. Professional solutions, services and consulting businesses worldwide
IBMs vision :
The following are the main components of IBM’s vision statement:
• World’s most successful and important information technology company

• Helping customers apply technology to solve their problems
• Introducing extraordinary technology to new customers
• Continue to be the basic resource of much of what is invested in this industry
SWOT Analysis of IBM group of Industry
SWOT analysis of IBM analyses the brand/company with its strengths, weaknesses, opportunities &
threats. In IBM SWOT Analysis, the strengths and weaknesses are the internal factors whereas
opportunities and threats are the external factors.
SWOT Analysis is a proven management framework which enables a brand like IBM to
benchmark its business & performance as compared to the competitors and industry. As
of 2020, IBM is one of the leading brands in the IT & Technology sector.
IBM Strengths:
Below are the Strengths in the SWOT Analysis of IBM:
1. Global Presence of IBM across several technology based sectors

2. Strong brand name and a global presence
3. Huge client base which is loyal towards the services of IBM
4. Big talent pool with expertise in their work force
IBM Weaknesses
Here are the weaknesses in the IBM SWOT Analysis:

1. Intense competition from other leading global IT companies
2. Challenge of employee retention as attrition is high
IBM Opportunities
Following are the Opportunities in IBM SWOT Analysis:

1. Emerging markets can be tapped
2. Can become One Stop shop for Enterprise IT
3. Domestic projects in countries like India and China
IBM Threats
The threats in the SWOT Analysis of IBM are as mentioned:

1. Threats from companies like Infosys, TCS, Accenture globally
2. Large size of the company can affect output quality at times
IBM Brand Analysis

Parent Company IBM
Category IT Services
Sector IT & Technology
Tagline/ Slogans Let's build a smarter planet
USP One of the best known brands in the world
IBM STP
IBM Segmentation Enterprises seeking IT solutions

IBM Target Market Enterprises looking for end to end IT solutions to transform business
IBM Positioning Enterprises seeking quality partner
In Michael Porter’s model, a company uses its generic strategy to ensure competitive
advantage against other firms in the same industry or market. In IBM’s case, a high rate of
technological innovation is at the core of the company’s generic competitive strategy.
For example, the firm is popular for a variety of novel technologies, such as machines used
in corporate offices around the world. Nicknamed Big Blue, IBM also applies its intensive
strategies for business growth based on such emphasis on technological innovation.
However, the company uses various intensive growth strategies that address business
potential and opportunities in the industry.
IBMs Business Level Strategies :

IBM’s Generic Strategies (Porter’s Model)
Overall Cost Leadership: At present, IBM’s primary generic strategy is cost leadership.
In Michael Porter’s model, the generic strategies are what companies use to ensure competitive
advantages. In this case, the cost leadership generic competitive strategy supports IBM’s
competitive advantages through cost-effectiveness of its operations.
For example, the company’s strategic objectives are focused on reducing the costs of production.
The cost difference enables IBM to minimize its selling prices and, consequently, make its
products more attractive to target customers. Also, the lower costs allow the company to keep a
higher profit margin if product prices are maintained.
Differentiation : Nonetheless, the differentiation generic strategy continues to play a
strategic role in supporting the company’s competitive advantages despite business emphasis on
cost leadership.
It is worth noting that IBM has shifted its generic strategy through the years.
Focus Differentiation :Initially, the company used differentiation focus as its generic
competitive strategy. Differentiation focus involves differentiation of products through
uniqueness or value to customers, and focus on a specific segment or segments of the market. In
this case, IBM’s initial strategy was to focus on businesses as its target customers, and hence the
name International Business Machines.
Focus low Cost: However, as the business grew, the company started emphasizing cost
reduction to ensure competitiveness in its current markets. This condition shifted IBM toward
using the cost focus generic strategy. Cost focus involves focusing on a segment or number of
segments of the market, but relying more on cost minimization to ensure competitive advantages.
Today, IBM has shifted toward using the cost leadership generic competitive strategy. The
company no longer limits its product offerings to businesses as its target customers. For example,
in acquiring The Weather Company, PwC Consulting, and SPSS, IBM has broadened its target
markets beyond business organizations as clients.
IBM’s Intensive Strategies (Intensive Growth Strategies)
Product Development (Primary Strategy). IBM’s primary intensive growth strategy is

product development. A strategic objective in implementing product development is to grow the
business through continuous innovation to introduce new products to the target market.
For example, in applying this intensive strategy, IBM can grow through the sale of its new
computing systems in addition to the sale of its other products. The cost leadership generic
strategy supports product development through efficiencies that enable the company to offer new
products at competitive prices.
Market Penetration (Secondary Strategy). Market penetration is a secondary intensive

growth strategy in IBM’s information technology business. One of the strategic objectives in
applying market penetration is to maximize the company’s market share of each product line or
product type.
For example, IBM aims to maximize its market share for cloud platform products. The cost
leadership generic competitive strategy provides cost minimization measures to empower the
company to succeed in using this intensive strategy. Considering that the firm is already among
the biggest players in the global industry, market penetration now holds only a secondary role in
facilitating the growth of the business.
Market Development (Supporting Strategy). IBM applies market development as a

supporting intensive strategy for business growth. A strategic objective based on market
development is to develop new applications of the company’s current products to enter new
markets or market segments.
For example, IBM can develop new applications of its information technologies in autonomous
vehicles. The cost leadership generic strategy supports market development through cost
effectiveness that leads to competitive advantage in new markets or market segments.
Diversification (Supporting Strategy). Diversification is an intensive strategy that has a

supporting role in IBM’s growth in the information technology industry. In this case, one of the
company’s strategic objectives is to diversify its business operations.
growth. Diversification supports the cost leadership generic competitive strategy through an
increase in potential advantages based on newly acquired business capabilities. The company
can implement this intensive growth strategy to take advantage of the trend of technological
integration in various markets, which is an opportunity identifiable in the PESTEL/PESTLE
analysis of IBM.

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COMILLA UNIVERSITY

Managing Strategy and Strategic Planning: IBM

International Business Machines Corporation (IBM) is an American multinational technology company

Acquired on Company Business

1. Leadership in creating, developing and manufacturing the most advanced

The following are the main components of IBM’s vision statement:

• World’s most successful and important information technology company

SWOT Analysis of IBM group of Industry

Below are the Strengths in the SWOT Analysis of IBM:

1. Global Presence of IBM across several technology based sectors

Here are the weaknesses in the IBM SWOT Analysis:

Following are the Opportunities in IBM SWOT Analysis:

The threats in the SWOT Analysis of IBM are as mentioned:

IBM Brand Analysis

IBM Segmentation Enterprises seeking IT solutions

IBMs Business Level Strategies :

IBM’s Intensive Strategies (Intensive Growth Strategies)

Product Development (Primary Strategy). IBM’s primary intensive growth strategy is

Market Penetration (Secondary Strategy). Market penetration is a secondary intensive

Market Development (Supporting Strategy). IBM applies market development as a

Diversification (Supporting Strategy). Diversification is an intensive strategy that has a

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