INTEGRATED MARKETING COMMUNICATION
What makes the global business operating environment uncertain, complex, diverse, & transparent? What role do “values & principles” play in the functioning of large organizations;
What are the 3 facets of global leadership skills? Institutional, integrative, & identity related? How do organizations manage change? How are management: actions for transformation planned?
The mission of IVT4. and services delivery functions…. human resources.
Members of IBM‟s fifth Integration & Values Team (IVT5) were close to finishing their deliberations in April 2008. formed in 2002.
. had been to globally integrate the company‟s supply chain. manufacturing.
oriented systems thinkers who reflected IBM‟s emphasis on innovation. globally. People responsible:
◦ Jon Iwata.
IVT5‟s mandate was to identify ways to integrate IBM‟s people & culture in order to produce more global leaders & citizens. SVP Corporate Communications &
◦ John E. Kelly. SVP & Director IBM Research.
. IBM (Big Blue) nearly perished in the late 1980s/ early 1990s.
Founded in 1911 by Thomas Watson. appointed in 2002 set out to globalize IBM.
New Chairman & CEO Sam Palmisano. (1993-2001) IBM “retooled itself from a hardware & PC manufacturer to a software & services provider. Under Lou Gerstner.
◦ Global Financing. ◦ System & Technology. it sold off the PC business to Lenovo. ◦ Software.
.2007: IBM acquired over 50 small software development companies for $16 billion to meet its need to provide service. IBM grouped its businesses in 4 areas: ◦ Global Services. in China. In 2005.2003 .
Global scope/ International business: By 2007.
. Over 50 countries grew at >10%. 60% of IBM's revenues & 65% employees were located overseas. BRIC countries had special significance as growth markets.
.000 vendors/ 100.000 partner companies.
Extended Family & Ecosystem
IBM served every industry across markets with 1 million clients. Relationships varied by market .in some areas HP. & 33. Oracle. & Accenture were major competitors .in others they teamed up as partners with IBM. Microsoft.
Technology & innovation IBM was always committed to technology & innovation being an engineering product manufacturer – Gerstner simply revived the spirit.
Adopting “open source computing” a major step. Patents applied in the US as early as in 1993.
Technology & innovation IBN also partnered with academia to promote service science management & engineering (SSME). IBM now partnering with Google on major cloud computing initiative.
Global Innovation Outlook (GIO) online project „Innovation Jam’ attracted 150.000 participants.
IBM was a self-described “globally-integrated enterprise focused on innovation”.000 employees working in 170 countries generating $99 billion in annual revenues.
By 2008. with 386.
Palmisano & other senior executives circumnavigated the globe. meeting major clients.
Palmisano: “Management by Flying Around”
With internet in use for routine work. government officials & mentoring executives on ground.
& customers. Given higher status & compensation.Lowering the Center of Gravity Global integration intended to make it easier to bring ideas. On the ground. initiatives & people to clients worldwide. technology. leaders strengthened links with vendors.
. Decision making moved down the line to Regional Executives leading Integrated Operating Teams. partners.
◦ IBM Business Leadership Forum.Lowering the Center of Gravity ◦ Lab opened in Moscow.
. Few “power holders” but many “integrators”. ◦ Corporate Philanthropy projects. ◦ Centers of Excellence in many locations.
“Local managers” also connected with the IBM global network. Local policies & educational systems affected business .IBM wanted a say. Country GMs and local teams “IBM’s local ambassadors”.
. Closer connections on ground provided sound local knowledge.Localizing: WHY? Governments were major clients.
GM – IBM. like walking on the rope. Russia.
“The art of management of IBM is to balance.” – Kirill Korniliev. It is one successful strategy all the time.
a collaborative spirit & concern for the social good”. initiative-taking. Find ideas & opportunities “anywhere in the world” to enrich & change the entire organization. to quickly & effectively produce value for customers. persuasion & diplomacy. bring them together.GIE objective: channel global resources.
. Managerial skill development focused on “systems-thinking.
was a direct response to the new business environment: uncertain. & transparent.
Globally integrated enterprise: IBM‟s gradual transformation. diverse.
). new direction in globalization. terrorism& security concerns.
. Turn of the Millennium: Asian financial crisis. free trade.How did changing Global Trends affect IBM’s moves? In the 1980s: deregulation. Web 2. Tata.0. SAB. emerging markets (CEMEX. end of Cold War. disruptive technology.
What global forces drove IBM to become a Globally Integrated Enterprise (GIE)?
a) b) c) d)
Uncertainty. Complexity.1. & Transparency.
1. difficult to predict where next disruption will come from.What global forces drove IBM to become a GIE? a) Uncertainty ◦ Greater interconnectedness leads to greater interdependence. ◦ With innovation all around. ◦ Disruption anywhere in (global supply chain) could disable the entire system.
. at all times. ◦ The difficulty in knowing & responding to what is happening in all places.
What global forces drove IBM to become a GIE? b) Complexity: With access to communication technologies more choices & competition in the market. Companies work better as interconnected networks of parts. money.
. Relationships with partners becoming closer – overlapping/blurring organizational lines. to respond to the flow of people.
1. & ideas.
What global forces drove IBM to become a GIE? With “global push” companies encounter different religious. national.
. & cultural types. ethnic. Understanding of diverse cultures essential for explaining/ motivating/ causing behavior.1.
With deregulation companies enjoy freedom of movement but are also expected to be more responsible. & partners demand accountability . Customers.What global forces drove IBM to become a GIE? d) Transparency: Communication technologies make it easier for people to learn about company activities.
.companies that engage in questionable activities put at risk.
How did IBM adapt to the challenge? What did they do?
◦ Migrated from hardware manufacturer to value-added services & solutions..
◦ Refreshed values. meaningful innovation & trust. emphasizing client service.
MORE….2. ◦ Delivered solutions through extended partnerships within the ecosystem.
. Involved employees .2. Embraced open source technologies & built capabilities through acquisitions & continued R&D investment.held a ValuesJam 140. New York to its “geographies”.000 employees participated online.
How did IBM adapt to the situation? What did they do? Moved decision-making center of gravity lower down into the organization – out of from Armonk.
How did IBM adapt to the situation? What did they do? Emphasized trust & collaboration in interactions.. high-status Account Managers & Connector” positions.g.2.
. Created new roles. e. Put global supply chain head in China allowed local managers to adapt services to local context.
What skills must global leaders have?
What types of leadership skills did Sam Palimisano‟s actions as Chairman & CEO demonstrate?
collaboration with partners.
. MORE…. Embed values in action: via corporate diplomacy..Integrative – Identity: Identify values & principles to anchor members of the company. Get in “face time” by “flying around”.3. Look inside & outside the company speak to stakeholders.
What skills should global leaders have…
Institutional . approaches to innovation.
. Reinforce common ground: Let employees remain together by commitment to company values & principles. Allow to localize. Recognize differences & respect them.
What skills should global leaders have…
Motivate employees to self-organize by following company principles.
Tie people’s compensation & rewards to project outcomes.
. Make service an essential component for working in the company.
What ACTIONS would you recommend to Palmisano if you were part of ITV5? Unbundle headquarters further& make company more regionalized.
4. Build leadership training schools.notify people of resources. introduce them to initiatives.
What ACTIONS would you recommend to Palmisano if you were part of ITV5? “On-boarding/ Induction program” for new hires: start early. empower people. induct people from across the organization.
Set up a “leadership training” fund .
How would the recommendations be implemented?
What kind of organizational vehicle? ◦ New entity? Embed in existing entity? Coalition? Who to lead – sponsor OR champion the change? ◦ Human Resources? Corporate Citizenship? Others? A board?
get ahead of the change.3. complex.
How quickly should the project proceed?
◦ Fast because business environment is changing quickly. ◦ BUT. in steps. diverse environments: need to be adaptive?
. because of proof of understanding – is everybody coming along…? ◦ …especially in uncertain.
but with focus on following a strategic direction.
How quickly should the project proceed? ◦ Slow? Why? ◦ Because the foundation exists. ◦ Work more incrementally & let initiatives grow organically. but people & cultural change take time.
. & served roughly a million clients.000 companies in its global supply chain.000 companies in its business network. partnered with 100. IBM had become more globally integrated but the transformation was not yet complete. had 33. The company employed nearly 400.000 people.
. But the direction was right . and transparent operating environments.following of core values & principles. complex. & diversity tasks of global leadership.
The transition was not yet complete and answers were not obvious. integrative. diverse. also needed. and in the institutional. who also struggled with uncertain.
In becoming a GIE it confronted challenges and developed solutions with its clients.