IBM is an American-based multinational tech corporation with its headquarters in New York and has widespread operations in more than 170 countries. It deals in the production and selling of computer hardware, software, and middleware, providing consulting and hosting services, and is a major research and development firm. This SWOT analysis gives insights into the secrets behind IBM’s competitive strengths in the market as well as its weaknesses. It also looks at what threatens the brand in the marketplace as well as the opportunities for the brand. This analysis gives insights.
IBM – At a Glance
| Name | International Business Machine Corporation |
| Website | https://www.ibm.com/ke-en |
| Founders | Charles Ranlett Flint |
| Chief Executive Officer (C.E.O.) | Arvind Krishna |
| Headquarters | United States |
| Year Founded | June 16, 1911 |
| Type of company | Technology |
| Revenues (FY 2021) | $57.35 billion (2021) |
| Key Products/Services | Computer hardware and software |
| Key Competitors | Microsoft Corporation, Dell Inc., Cisco Systems Apple Inc., , Inc.,., Hewlett-Packard Company, Oracle Corporation, VMware, Inc. |
Strengths
Research and development
R&D is what informs IBM’s innovation and ensures the brand consistently supersedes customer expectations. IBM is the largest industrial research company in the entire globe. Through R&D, IBM has transformed from providing hardware solutions to a focus on the cloud to cognitive computing solutions and analytics solutions. It has 12 labs located on 6 continents, with its headquarters in New York at the Thomas J. Watson research center. The brand plans to establish itself as the leading hybrid cloud and AI brand of choice.
Strong innovation
IBM holds one of the highest records of patents in the technology world. Some of its inventions include the Automated Teller Machine, the Dynamic Random Access Memory (DRAM), the financial swap, the mobile, the electronic keypunch, the relational database, the magnetic stripe card, the floppy disk, the hard disk drive, the S-ABRE airline reservation system, the Universal Product Code (UPC) bar code, SQL, and the virtual machine among others. By adopting RedHat’s open-source approach to Linux operating systems as well as on the IBM hybrid cloud platform, IBM has been able to reduce costs through the provision of a flexible computing environment while at the same time maximizing the existing infrastructural investment.
An extensive suite of products
IBM has a huge and diverse portfolio of products and services. They include; cloud computing, the Internet of Things, artificial intelligence, commerce, IT infrastructure, commerce, mobile, Cybersecurity, and digital workplace.
A great human resource development culture
IBM stands tall because of the phenomenal individual employees that make up part of its workforce. IBM identifies an employee’s potential and equips them with the necessary support to produce great innovations. The company gives titles to exceptional performers, recognizes loyalty to the brand and individual innovators, and has annual award ceremonies in exotic places and exceptional performers are awarded fully paid trips to those destinations. The comprehensive program calls out the innovative potential of its employees.
Strong financial performance
A strong financial position is very critical to financing the company’s R&D budgets and expansion strategies, among other critical areas of operations.
Strategic acquisitions and sell-offs
This strategy has kept IBM afloat for the longest. Acquisitions and sell-offs have helped IBM cut off nonperforming business lines and acquire ones that have greater profitability for the brand’s posterity. This strategy has ensured an increase in predictable and profitable revenue streams, gain in expertise and resources, expansion into profitable markets, and increased efficiencies of operations. The brand has made a series of acquisitions, including Rational Software, PwC consulting, SPSS, Red Hat, the Weather Company, Nordcloud, the European cloud consultant, and Databand. The company recently announced its intentions to acquire Turbonomic and selling off
High customer satisfaction ratings with a strong global presence
While IBM has a presence in more than 174 countries globally, the brand is in the first position for customer satisfaction in the management top 250 ranking by the Wall Street Journal. IBM is known for great support through virtual agents and their human counterparts. Virtual agent technology uses a combination of artificial intelligence, natural language processing, sentiment analysis, natural language generation, machine learning, language translation, robotic process automation, speech-to-text, optical character recognition, and back-end process setups to bring superior quality support to its end users. The brand also provides a broad solution catalog.
Weaknesses
Loss through obsoleteness of legacy systems
IBM has impressive longevity title in the IT industry with great inventions like the mainframe computers, to floppy disk inventions. The world of technology is, however, speedily evolving, with many businesses embracing the cloud. Some of the previously great inventions have the put down in favor of cheaper and more efficient solutions. This will render some of IBM’s innovations obsolete and could lead to product losses.
Opportunities
Sell-offs, acquisitions, and partnerships.
Sell-offs are a great opportunity for IBM to dispose of legacy systems that could be getting obsolete and also dispose of low-performing products, which could weigh down on the brand’s profitability. Strategic acquisitions and partnerships offer the brand opportunities for expansion in knowledge, expertise, resources, and market penetration so that through these synergies, the brand will be able to achieve more than it would have were it on its own. Redhat’s acquisition, for instance, changed the trajectory of IBM to secure its going concern as a hybrid cloud solution provider.
Continuously changing customer needs
While technology has continued to evolve the world over, customer needs have continued to drive new innovations and products. These changing needs, tastes, and preferences are now defining new competitive edges for companies. IBM should continue to invest in identifying the changing customer needs and preferences so that IBM continues to position itself as a brand that provides the needed industrial solutions for the changing customer needs and preferences
Market Research and Development driving innovation
There are inexhaustible opportunities for IBM and other technology companies when it comes to research and development. IBM is critically aware of this opportunity and has continuously invested in one of the largest and leading research and development centers.
Threats
Stiff competition
IBM faces stiff competition from huge global brands like HP, Hewlett-Packard, Oracle, Accenture, Microsoft, and Apple, among others. With every increase in the number of worthy competitors, IBM’s market share decreases more and more.
Conclusion
IBM is a strong brand, and its major strength is its continued R&D, more innovation, and continuously evolving to meet the changing customer needs. This will keep the company strong against competitors and in favor of customers.
