Adamjee, Tasneem ENTP 6375 07/01/2018
Work cited:
Emerging Business at IBM (HBS #304075), Harvard Business School 1
Case: Emerging Business at IBM (A) (HBS #304075)
1. A. Why do large companies like IBM find it so difficult to create
new businesses?
• IBM’s management rewarded for control and execution that lead to managers
focusing on short term execution rather than long term strategies.
• Old companies like IBM (founded in 1911) have their foundation and company
culture strong and set for many years, therefore unlike startups, large
established companies are not flexible in changing their structure and
foundation.
• IBM has a complex structure (7 groups and 30 units) and struggles to collaborate
with other sections/businesses internally.
• IBM considers and focuses on current customers’ needs and fails to recognize
new market opportunities.
• IBM struggles to compete with tech startups with new innovative solutions,
cheaper products, disruptive techniques, and agile strategies.
• IBM focuses on profitability of their mostly stable businesses and new businesses
were expected to achieve unrealistic goal (sales and earnings).
• At IBM market research insights were mostly focused on factual analysis and
decisions were made when the market was still immature.
• IBM allocates resources more towards established businesses, and when time
comes new businesses are often the first ones to lose resources and budget
allowance.
Adamjee, Tasneem ENTP 6375 07/01/2018
