Situational analysis can be defined as an analysis that evaluated the internal and external conditions particular to an organization that has the direct impact on the selection of the suitable business strategy and the overall performance of the business. It involves a systematic study and collection of the findings, data, and other important information in order to understand and identify the specific issue that may create problems to the business practices in the long run (Beukes, et al, 2010, pp. 358-365). The report presents the internal and external analysis of a leading information technology services provider named as International Business Machine (IBM).
IBM or International Business machine is an IT consulting and computer technology providing corporation headquartered in Armonk, New York (United States). It speciality includes the marketing of computer peripherals, consulting and hosting solutions including social and technological attributes.
The corporation was started is a small village of Endicott, US in 1911. It was named as Computing Tabulating Recording Company at initial stage due to the merger of three companies, Company Scale Company, Tabulating Machine Company and International Time Recording Company. In 1924, the name of CTR was changed to IBM.
IBM is ranked as the second largest It service provider with more than 435,000 employees all over the world. It has total 12 research labs having a number of patents in information technology and software industry (Story, 2018).
Products of IBM
IBM Cloud
It is a transformative private cloud platform providing assistance of the public cloud from the safety of the user’s data center protected by firewall. It is built on Kubernetes based architecture and allows the developers to use built-in services and development tools.
SPSS Statistics
It is a leading statistical software which is used to solve a number of research and business problems. It provides variety of techniques including hypothesis testing, select and perform analysis, ad-hoc analysis, sharing the results and many more. New features include publication ready charts, third party software integration and Bayesian statistics.
API Connect
This is suitable for organizations who are looking for accelerating their growth into the API economy. It acts as a comprehensive management solution addressing the entire aspects of API lifecycle, which includes run, create, secure and manage. It enables the internal and external consumers to capture new revenue and accelerate the API program of an organization.
Mission
The company strives to lead development, innovation and the production of most advanced information technologies of the industry, which includes software, microelectronics and computer systems. IBM translates these technologies into services for the customers with the help of professional values and consulting business around the world.
Vision
The vision statement reflects that the company is willing to provide quality and value services to the customers along with the creativity and innovation. The company also aims to provide full satisfaction to the customers with its services and quality of products (Bodislav, 2015, pp. 257-264).
The company works closely for the private and public sectors, including national, regional and local government, universities, non-profit organizations, school systems and research organizations. IBM is engaged with civic and highly qualified entities that are extremely committed to finding solutions and solving problems to bring them up to a scale (Cox & Jantti 2012, pp. 308-316).
Measurement and Impact
The management attempt to make a widespread, sustainable and measurable change from its services and products. It measures change by the development of a set of desired outcomes and the KPI’s for each initiated program by the country (Debortoli, Muller, & Vom 2014, pp. 289-300).
Stakeholder’s Engagement
The collaboration and engagement with the stakeholders is an integral part of the business strategy. Private/public partnerships and collaborations are important to overcome form societal challenges that are too big for any single industry or sector to manage alone. This is the main reason due to which, IBM works with the help of the variety of stakeholders including administrators, labor, policy makers, business and profit leaders to bring sustainable and transformative change to advantage the greater society (Frijns, Gilbert, & Tourani 2010, pp. 498-508).
IBM has some main competitive advantages, which can help the management to grow its business in the proposed country. They are as follows:
The company is enjoying the benefit of being the credible service provider in the information technology sector.
Very few companies and individuals have knowledge about the range of products and services offered by IBM. The projects that need an implementation of multiple technologies and to manage services at the same time, IBM is called a one-stop shop (Grabova, et al, 2010, pp. 39-50).
The real fact is that the world runs behind legacy systems irrespective of the sound knowledge about big data, cloud computing, and IT services. IBM also take care of its critical system running on its mainframe and to the customers who are paying continuous maintenance for a long time (Harreld, O’Reilly, & Tushman 2007, pp. 21-43).
The main factors that help the company in creating its corporate culture are as follows:
Integrity
Integrity is a value that is required to be considered in all the internal and external relationships of the company. It makes the company as truthful, honest and straightforward in dealing with the customers and stakeholders (Januszewski 2009, pp. 39-45).
Ethical practice
An organization working in the IT industry has the most important responsibility to deal with the ethical practices. IBM is handling this responsibility in a very effective manner. The company deals with the ethical norms of named ‘put the client first’. It means that the company’s main focus to provide the high level of customer satisfaction and to manage the personal information very carefully.
Diversity
IBM provide employment to the employees from different cultures and regions. This indicated that management value the knowledge and expertise more than the religion and caste. The company is engaged with providing fair employment to deal with the corporate culture of the information technology industry (Kahn & Ranade 2010, pp. 185-191).
New Zealand has a stable government and there are great chances for IBM to get success and to grow because of the strong regulations and rules. But. The labor rates and the land rates are high due to which the company has to pay more tax in comparison to the other countries. The government and political change happen in every three years which is not is the favor of the company because every government makes its different rules and regulations due to which the organization also have to change its legal framework which includes the cost of hiring experts (North, et al, 2013, pp. 419-428).
In context with the legal environment, the crime rate of the country is very low irrespective of changes in government which takes place after every three years. The government is continuously working towards removing the corruption from the society. Along with this, the legal system of New Zealand provides trade freedom to the new companies to enter the market and to the existing companies to expand their business into all the regions of the country. This indicates that IBM has open opportunities to expand its business but the profit margin is low due to the high tax rates which can become the main reason for low-profit margins.
The economic condition of New Zealand is very strong which can be validated by analyzing the per capita income of its residents. This provides IBM a chance to sell its products at high rates as the customers have the financial capability to afford the same. The unemployment is found at a very low rate as well as the inflation rate is also very low, which shows a positive sign for the organization to earn profits. The market of New Zealand demands sound financial investment to make higher profits in which IBM is not so far away (Rizzolo et al, 2007, pp. 65-75).
The social system of New Zealand is very good and different from the other developed countries. The country depends on other countries to get new and innovative technology and thus it does not invest a huge some in research and development processes. In such scenario, it IBM provides its services with new technological advancements at reasonable or slightly high rates, then it can earn profits and perform well in the local as well as the regional market of New Zealand. This country has less population which can affect the sales of the organization in a negative manner.
The educations system of New Zealand is considered the seventh best educational system in the world. This indicates that the people of New Zealand is well aware of the latest technological advancements and are also open to accepting the same. This may work as the best positive sign for IBM as the company deals in the facilities and products which are completely based on the innovation and technology. The country has also introduced the use of internet and information technology in urban as well as in rural areas up to an extent which has resulted in increasing the literacy rate up to 99%. This means that the management does not need to make any type of financial investment to educate people about the use of information technology-based products and services (Rusaneanu 2013, p. 148).
One more advantage that can be used by the management is the use of local talent by providing employment. I would decrease the cost of products as the management does not need to hire the employees from other countries at higher salaries and wages.
The nation is located 900 kilometers away from Australia and has an exclusive ecological system. Due to the well-educated people, the pollution level is also low in the country as they are well aware of the negative and positive changes in the environment and works in the direction to get rid of the harmful effects. The country has adopted the latest technologies to deal with garbage. To compete in this type of environment, the IBM would also have to adopt such practices and functions which may not harm the environment (Schlafke, Silvi, & Moller 2012, pp. 110-122).
In new Zealand, IBM identifies that a diverse base of suppliers is integral to the profitability of the organization. Maintaining and building a diversified community of suppliers enables IBM to apply new approaches, to hear new ideas and to access the supplementary solutions in response to the emerging needs of the customers. This collaboration of suppliers helps the organization to deliver quality products, innovation, and best services in the continuously growing marketplace at the international level.
IBM was the first organization of the information technology sector to join the Billion Dollar Roundtable, an organization motivates business to increase their expenses on the diverse suppliers (Scuotto, Ferraris, & Bresciani 2016, pp. 357-367).
Supply chain management is highly based on the competitive advantages of the organization as the company is dealing in the sector which is continuously changing. Thus, the company has to make immediate solutions for customers and to manage the suppliers in such a way so that any of them may not stop the supply of material and information.
|
Bases of Comparison |
Oracle |
Infosys |
|
Sector |
It and Technology |
IT and Technology |
|
USP |
It provides a full spectrum of IT products from ERP to Java and database. |
Transformation of Business through IT |
|
Target Group |
Target B2B as well as B2C for database, servers, ERP and technology frameworks. |
Large Organizations having It needs and high budget. |
|
Products |
SAAS, PAAS, Consulting, and Financing. |
Pioneers of Global Delivery Model. |
IBM is working in the IT industry in which technological ethics and responsibility are existed up to a great extent in and are monitored by the government of New Zealand. The solutions and software provided by the company are used to manage the personal information of large customers. Thus, it is necessary to maintain work with the ethics and the social responsibility to maintain the brand image and to gain the trust of the customers (Tian, et al, 2008, pp. 319-327).
The emerging trends and needs of customers are impacting the business of the company as it regularly needs to provide training to the employee which incurs a huge cost. Similarly, security and privacy is the major concern in the services provided by IBM. If any of the customers face any type of breach in privacy and security, then it becomes the liability of the company to bear all the losses for the same.
Geographic Factors
It includes dividing the market into a number of geographical areas. The IBM is providing its services in almost all the regions of New Zealand and anyone can find its products easily.
Demographic Factors
This factor is related to the target customers to whom the company is providing its services. It includes some national as well as international level organizations, which need to use innovative software to manage their data.
Psychographic Factor
These factors divide the customers in several bases like income, type of business, type of market etch. IBM is mainly concerned with providing services to the international level organizations managing a large amount of customer data like Amazon, Google etc.
Behavioral factors
These factors depend upon the needs of the customers like some big companies need to use the software related services throughout the year while some other needs it once or twice in a year (Weinhardt, et al, 2009, pp. 28-33).
|
Name |
Robert Solutions |
Advance Developers |
|
Who? |
Firm providing accounting services |
The firm engaged in retail business with the help of advanced technology |
|
What does it do? |
Manages accounts of the Non-Profit Organizations |
Provides online shopping for clothes and groceries. |
|
What does it need? |
Confidential and fully secured software to manage all the data over years. |
A user-friendly mobile and computer software with the high level of security. |
|
Why it Purchases from IBM? |
IBM provides the appropriate software as its needs within in the budget. |
IBM manages all the data and provides regular updates in the software used by the company. |
Conclusion
On the basis of the above study, it can be concluded that IBM is working with a strong brand image and providing services as per its mission and vision statements. However, it has some main competitors in the business environment providing almost the same services but IBM is also making efforts of competing with them in the long run with the vast reach to the customers and suppliers. As New Zealand is an developed economy, it welcomes the technological advancements in the industry which can work as an advantage for IBM. There wage rate of the economy is very low which can help the organization to maintain the cost of its services. The crime rate of the country is comparatively low in comparison to other major economies due to which the company would not need to worry about the online criminal activities and stealing of data.
However, there are some disadvantages in the external environment of the country including the strong and strict taxation system, fast changing requirements of the companies and the competition with local companies of the country.
IBM can deal with such disadvantages by functioning in a clear and fair manner with taxation system and providing software and as per the changing requirements of the organizations and technology companies.
References
Beukes, PC, Gregorini, P, Romera, AJ, Levy, G & Waghorn, GC 2010, ‘Improving production efficiency as a strategy to mitigate greenhouse gas emissions on pastoral dairy farms in New Zealand’, Agriculture, Ecosystems & Environment, vol. 136(3-4), pp.358-365.
Bodislav, DA 2015, ‘Transferring business intelligence and big data analysis from corporations to governments as a hybrid leading indicator’. Theoretical and Applied Economics, vol. 22, no. 1, pp.257-264.
Cox, BL & Jantti, M 2012, ‘Capturing business intelligence required for targeted marketing, demonstrating value, and driving process improvement’, Library & Information Science Research, vol. 34, no. 4, pp.308-316.
Debortoli, S, Müller, O & VomBrocke, J 2014, ‘Comparing business intelligence and big data skills’, Business & Information Systems Engineering, vol. 6, no. 5, pp.289-300.
Frijns, B, Gilbert, A & Tourani-Rad, A 2010, ‘The dynamics of price discovery for cross-listed shares: Evidence from Australia and New Zealand’, Journal of banking & finance, vol. 34 no. 3, pp.498-508.
Grabova, O, Darmont, J, Chauchat, JH & Zolotaryova, I 2010, ‘Business intelligence for small and middle-sized enterprises’, ACM SIGMOD Record, vol. 39, no. 2, pp.39-50.
Harreld, JB, O’Reilly III, CA & Tushman, ML 2007, ‘Dynamic capabilities at IBM: Driving strategy into action’, California management review, vol. 49, no. 4, pp.21-43.
Januszewski, A 2009, ‘Overview of the business performance solutions’, Polish Association for Knowledge Management, vol. 20, pp.39-45.
Kahn, MG & Ranade, D 2010, ‘The impact of electronic medical records data sources on an adverse drug event quality measure’, Journal of the American Medical Informatics Association, vol. 17, no. 2, pp.185-191.
Mikut, R & Reischl, M 2011, ‘Data mining tools’, Wiley Interdisciplinary Reviews: Data Mining and Knowledge Discovery, vol. 1, no. 5, pp.431-443.
North, N, Leung, W, Ashton, T, Rasmussen, E, Hughes, F & Finlayson, M 2013, ‘Nurse turnover in New Zealand: costs and relationships with staffing practices and patient outcomes’, Journal of Nursing Management, vol. 21, no. 3, pp.419-428.
Rizzolo, RF, Foote, TG, Crafts, JM, Grosch, DA, Leung, TO, Lund, DJ, Mechtly, BL, Robbins, BJ, Slegel, TJ, Tremblay, MJ. & Wiedemeier, GA 2007, ‘IBM System z9 eFUSE applications and methodology’, IBM Journal of Research and Development, vol. 51, no. 1.2, pp.65-75.
Rusaneanu, A 2013, ‘Comparative analysis of the main business intelligence solutions’, Informatica Economica, vol. 17, no. 2, p.148.
Schläfke, M, Silvi, R & Möller, K 2012, ‘A framework for business analytics in performance management’, International Journal of Productivity and Performance Management, vol. 62, no. 1, pp.110-122.
Scuotto, V, Ferraris, A & Bresciani, S 2016, ‘Internet of Things: Applications and challenges in smart cities: a case study of IBM smart city projects’, Business Process Management Journal, vol. 22, no. 2, pp.357-367.
Story, S 2018, ‘IBMSUCCESSSTORY’ [Online]
Available at: https://successstory.com/companies/ibm
[Accessed 31 August 2018]
Tian, YL, Brown, L, Hampapur, A, Lu, M, Senior, A and & CF 2008, ‘IBM smart surveillance system (S3): an event-based video surveillance system with an open and extensible framework’, Machine Vision and Applications, vol. 19, no. 5-6, pp.315-327.
Weinhardt, C, Anandasivam, A, Blau, B and Stößer, J 2009, ‘Business models in the service world’, IT professional, no. 2, pp.28-33.
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