IBM is one of the most well-known names when it comes to computer companies. Believe it or not IBM (International Business Machines) did not start out as IBM. They originated as CTR which is Computing, Tabulating and Record Company then changed their to IBM in 1924. Throughout the years IBM has gained a lot of fame and gone through many changes in its long continuous life. Many problems were brought along with this fame. IBM is now a multinational company where they are based in New York. They are also making a big leap into the cloud service industry. This multinational company has grown to have a staggering 380,000 employees.
I. The History of IBM
IBM takes big footprints when it comes to technology companies. IBM has had great success with its employees and how they develop through the company and is proud that they had five Nobel prize winners that worked for IBM at the time. The problems they face now is unlike the challenges they have had in the past. IBM needs to bring back the past because they have been declining in the past five years and the accomplishments they had are too big to just run a company to the ground. IBM is all about creating the next coolest thing and showing off their employees’ talent to the world.
Significant Accomplishments.
One of their earliest accomplishments was in 1936 when they helped the United States government develop social security. This was their first great feat in technology. Also, within 20 years later they created the famous hard disk drive which took the first leap into data storage. IBM was so competitive in making the greatest smartest machines to compete with not only the smartest people, but the other machines people were building. They were capable of helping launch the Apollo mission and making a robot that is undefeated in chess. They prove to the world their pure genius and the complexity of their machinery. In order to make prices lower to operate personal computers the company created the floppy disk which was the first storage device on personal computers that is price cost-effective. This gave the company such a popularity. Seeing all these new machines come from IBM made working their highly desirable because not only did you get to help make these machines you were seen as a high intellect who truly understood all there was about IBM. The company took steps towards diversifying the company earlier in its lifetime which is ironic to their problem they face now. Before the 1950s they had already created training programs for women and disabled people.
Downfalls.
IBM now has to tackle a problem a lot of companies are also beginning to face. IBM has been accused of firing employees due to their age. The ADEA was enacted in 1967 but never used to be such a big problem until the 2000’s arrived. IBM has taken the offensive is staing that they are laying off based on productivity and ability for the company. The company has unfortunately been facing this problem for about 6-7 years. This makes the job undesirable because people are scared of being fired when they get older. IBM used to be known as a reliable company that if you worked hard it would pay off and you wouldn’t lose your job or be laid off. When Louis Gerstner took charge he did the complete opposite of what IBM stood for. He laid off 60,000 workers. This caused chaos in IBM because it forced people to start looking for other jobs in anticipation that they were going to be laid off. AS of last year they hit a point where revenue had fallen for 20 straight quarters. This is very bad for a company and never should happen. In its efforts to fix this IBM decided to fire more and more employees. Over 20,000 employees have been fired that were over the age of 40 years old. Maybe IBM is trying to make a shift towards the younger generation in hopes they will be able to create the best company model or create the next big thing.
Overall Consensus of IBM.
IBM is in the business for the future and its culture has been changing over the years which they need to look back and reflect on which decisions benefit them best. Michael E. Porter’s Five Forces Analysis is a strategic management tool that identifies the external factors and their intensities in contributing to the five forces (competitive rivalry, buyer power, supplier power, substitution threat, and new entry threat) that shape the competitive landscape of the industry environment. In this case of IBM, the external analysis considers the situation of the information technology industry. There is a wide array of factors that influence the actual performance of Big Blue, but the external factors presented in this analysis are some of the most significant and relevant to the business (Arshed & Pancholi, 2016). This look goes deep into the way they manage their company but in changing this they have altered the company which has damaged the company more than their management tactics. One key aspect to note is the company’s behavior in times of change. Employees run around frantic about losing their jobs and eventually down the line lawsuits are filed for laying off because of a certain discrimination.
II. Edgar Schein On Organizational Culture
Edgar Schein developed one of the most influential models when you want to evaluate an organizations culture. He is considered one of the great minds of management. Many companies refer to Schein when they want to see how to improve the culture within their company.
You have to start with the outer layer of Schein’s Theory, Artifacts and Symbols, these would be the things you can easily see in a company such as their dress mandate, logo, and the way a company presents themselves. This outer layer is most important to people that don’t want to work for the company and want to possibly invest or work for/with them. How a company presents itself is very important, no one wants to work for a company that is proud of what they do and is proud to be seen working for them. The next layer into the company would be the company’s values, these values are often seen as the company’s norms. Schein describes the company’s values as the reasons insiders give to explain why they do the things they do (Schein, 1988). Values is very important to the fundamental structure of a company and its success throughout their niche. Values set the bar for how employees behave when it is in the workplace, outside the workplace, dealing with customers and just including the customer in their values and how they might go about the same situation the customer has. The last and most hidden from the outside world is the assumptions in the organization’s culture. Such assumptions often start out historically as values, but, as they stand the test of time, they gradually become assumptions and come to be taken for granted (Schein, 1988). These little assumptions were once rules but since they have been successful for so long, they will often carry on for many years and then eventually they aren’t even talked about or stated. They are merely used without question and it is an everyday task that is thought twice about. An organizations culture can change over the years due to the environment the companies in and stress on certain areas within Schein’s model. This is not necessarily a bad thing it is just the company adjusting to the evolution the world and making small adaptations to accommodate. Every company has this model in their company but no company is the same in their culture.
III. Decision Making Model
Identifying the Problem.
The obvious problem with IBM is its age discrimination that has been occurring over the last ten years. IBM is facing a lawsuit for age discrimination in its company mainly from the states of North Carolina, California and Georgia. These employees felt they were fired in regards to their age and they have teamed up with Shannon Liss-Riordan who has also went against some of the biggest companies like Amazon, Uber and Google. IBM needs to clean up its act with firing people of older age.