Creating a smarter enterprise

The science of transformation

Change is essential to progress. Today’s global business leaders embrace this conventional wisdom. The ability to transform is a prerequisite not only for progress, but also for survival in the shifting, modern global economy.

But how do you orchestrate a corporate culture of constant reinvention? How do you ingrain it into the DNA of your organization? How do you manage it? Measure it? Make it a competency for your leaders and your entire organization?

IBM has developed a differentiating point of view about addressing this transformation challenge, one informed by our client’s needs and years of hands-on experience and trial and error. IBM has built a business model predicated on a commitment to continuous transformation. In an industry in which there is perpetual tension between innovation and commoditization, IBM has followed the path of innovation and reinvention.

For a decade, IBM has been transforming itself through aggressive pursuit of global integration. By adopting common, shared-support functions, enterprise-wide processes, a strong governance system and leveraging global skills, the company has improved client value and driven enormous productivity savings, freeing up resources to invest in growth and innovation.

As a result, IBM has achieved strong and sustained business performance. In 2012, IBM achieved its tenth consecutive year of double-digit earnings per share growth and is on track to achieving its 2015 earnings-per-share roadmap. Our shared services, end-to-end process transformation and integrated operations have yielded cumulative productivity savings of US$6 billion in the initial 2010 roadmap, and we are on track to achieve an additional $8 billion by 2015. This ongoing profitability has generated excellent cash flow, enabling IBM to better serve our clients, deliver substantial returns to investors, while also investing in the business – including $75 billion in research and development since 2000.

While no two organizations are alike, IBM believes its approach can be helpful to transformation journeys of others. Indeed, every year IBM leaders meet with hundreds of clients to exchange ideas and discuss transformation experience and collaborate on challenges and strategies. This guide shares the best practices and lessons learned (thus far) as IBM and its clients seek to master the ever-evolving science of transformation.

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