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Transforming IBM’s IT Function: A Blueprint for Global Business Integration

This document outlines the evolution of IBM’s IT function, focusing on its transformation through global integration and partnership with business processes. Since its inception in 1911 and entry into computing in the 1940s, IBM faced challenges in the 90s, including financial losses due to decentralized purchasing and declining demand. The restructuring involved centralizing IT, streamlining processes, and establishing common standards. This strategic approach not only optimized the IT structure but also positioned IBM for future growth through enhanced collaboration and shared services.

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Transforming IBM’s IT Function: A Blueprint for Global Business Integration

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  1. Building IT function for a Global Business Manpreet K Goraya

  2. Contents Background Global integration Transforming IBM’s IT function Positioning BT/IT for the future

  3. Background • Merger of three companies in 1911 in NY • Computing-Tabulating-Recording; machinery, equipment like meat and cheese slicers • Large-scale tabulating business solutions • 1940’s- Entered computing business. • 1952- Introduced first large computer. • 1960- Unbundling software and services

  4. Problem • IBM sold- technology managers/ centralized departments. • Individuals and divisions purchased own computers • Loosing money from 1990’s.

  5. Changes • Restructure and consolidate the business. • Cutting expenses • Integrate solutions and services.

  6. Global Integration • Globalizing and standardizing processes. • Introduce common systems and processes. • Partnership between IT and business processes • BUSINESS TRANSFORMATION and IT

  7. Transforming IT function • Made it centralized • Global technology services worked with Global Business Services. • Integrate IT within BU

  8. 2009 Transformation • Streamlined IT structure • A Run (with GTS and GBS) • 3 transform (Set standards) • 5 horizontal IT functions (across run and transform).

  9. Run organization • Worked with GTS and GBS. • Cost savings by setting standards. • Found standards looked for author otherwise dropped • Reduced from 121 to 20. • Common services

  10. Transform organization • Identified level 1 processes • Assigned enterprise process owner (EPO/VP) • VPCEO • Level 2 processes for level 1. • Process owner and KPI • Transform executives • Changes for new business functionalities

  11. Horizontal structure

  12. Shared services • Identified shared services. • Standardized, integrate and streamline global processes

  13. IT prioritization • Allocated IT budget. • Voted on important projects. • Allocated IT budget.

  14. BT/ IT for the future • New positions-Project managers, business analysts. • Cross process expertise • More opportunities for advancement.

  15. Question • Why was IBM loosing money in 90’s? • It shut down some of its important operations • It didn’t establish relationships with individuals and divisions which started buying their own computers • The demand for computer and services started declining • It wasn’t loosing money!

  16. Question • Why was IBM loosing money in 90’s? • It shut down some of its important operations • It didn’t establish relationships with individuals and divisions which started buying their own computers • The demand for computer and services started declining • It wasn’t loosing money!

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