Performing while transforming
How can large companies effectively respond to and take advantage of the current business environment? IBM offers a compelling story. While the market values of some its peers have eroded by as much as 30 percent since January 2008, IBM has continued to perform well, increasing its share value by approximately 15 percent over the same period.
The strong showing by IBM can be attributed in large part to a transformation journey upon which IBM embarked more than a decade ago. Influenced by the dot-com collapse and attendant declines in margins and earnings, IBM began a holistic assessment of its strategic environment and concluded that fundamental shifts – in technology, client requirements and global business – would soon reshape the economic and technological landscape. Essentially, IBM concluded that the world was about to change fundamentally and the company needed to adapt to excel in the new environment. This insight set in motion a number of strategic shifts – from investing billions of U.S. dollars in strategic acquisitions and new markets, such as India, China and Brazil, to aggressively driving costs out of selling, general and administrative expense – to create a stronger portfolio of offerings and a more efficient operating model.
As executives today work to transform their businesses, they may find insight from the IBM story on where to focus change and how to accomplish it successfully across the enterprise while delivering consistent and differentiated performance.