Digital Economy: IBM Case

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Introduction

International Business Machines (IBM) is a computer technology company and with an interest in information technology. The company mainly deals in manufacturing of computer hardware, development of software, consultancy and a host of other technology services.

This paper looks at internal IT management solutions at IBM with special interest in Enterprise Resource Planning, Network management, IT strategy and planning among others. Additionally, the paper looks into possible IT solutions regarding the aforementioned areas at IBM.

Supply Chain Management

Supply Chain Management is a concerted effort towards streamlining movement of products and supplies downward and upward in a supply chain. IBM has an Integrated Supply Chain team. An ISC team was formed to oversee matters concerning the supply chain.

Their main function is to identify weaknesses in the supply chain and identify measures that can be taken to improve performance. Since IBM has operations hubs in various parts of the world, ISC ensures that these teams deliver IBM’s strategies and shareholder expectations through monitoring and optimizing the supply chain.

The company uses software that tracks inventory movement and manufacturing real-time. It also updates customer information including ordering, market preferences and alerts production departments to ensure that necessary adjustments are made to forecasting to reflect market needs (Davenport & Brooks, 2004).

The flow in the Supply Chain Management is categorized into three major flows depending on the materials in the chain (Davenport & Brooks, 2004). The use of IBM applications is executed in these three flows including the product, information and the flow of finances.

IBM applications in Supply Chain Management are categorized into two main software applications. They include Planning Application Software and the Execution Software. Whereas the Planning Applications are used in the process of identifying best filing methods for various orders, the Execution Applications are used to in the physical tracking of conditions of goods (Davenport & Brooks, 2004).

In addition to the physical tracking, the Execution Application Software also facilitates the proper material and financial management within the chain (Davenport, & Brooks, 2004). It is worth noting that, the two Supply Chain Management (SCM) Software Applications operates with transparency, hence; allow sharing of information both within and outside the enterprise (Davenport & Brooks, 2004).

The use of the IBM applications has facilitated faster and a more cost effective system of not only production of materials, but also the supply of the same materials produced. The cost of transportation, inventory as the flow of information has greatly subsided.

Enterprise Resource Planning

At IBM Enterprise Resource Planning is a direct effort towards increasing business effectiveness, efficiency, and performance. At IBM, various software solutions have been developed to reflect various functions, departments, processes, and decision-making areas.

At a manufacturing plant, the operations manager receives the market information from sales and marketing department that reflects the sale-ability and demand of a certain brand (IBM, 2012). To enable top managers to make strategic decisions, various Decision Support Systems have been incorporated into the ERP systems.

This allows top management to assess entry into new production lines, enhance production of an existing product, or cease production of obsolete brands. It is important to note that storage is too costly for such a firm. Hence, management strives to ensure that market demand and production levels are instantaneously met to reduce holding costs. This increases effectiveness and efficiency of operations, which grows shareholder value (Davenport & Brooks, 2004).

Document Management

As part of a broad document management solution at IBM, the company has developed specific software for managing company documents. The IBM Document Manager seamlessly and intuitively integrates into common office applications and into Microsoft Desktop. Hence, it is possible to use the software in email, and to integrate it with web applications such as Mozilla, Internet Explorer etc.

Additionally, IBM Document Manager easily incorporates functions of common desktop applications such as Microsoft Word, Excel, Power Point, Windows Explorer, and Windows desktop. It also has the ability to use Email solutions such Outlook and Exchange (IBM, 2012). This ensures a broad coverage of all channels that clients may use to channel grievances, requests, orders, invoices etc.

IBM uses this software across all its networks, departments, and clientele. This makes that it integrates into all parts of the supply chain including suppliers. It also ensures that information that needs to be shared across departments is shared easily. For example, an invoice may be shared by purchasing and accounting departments (Horan & Rhodes, 2008).

Network Management

Currently, there is critical need for a good network infrastructure. Technology shifts and dynamics in the competition market necessitate a need for a flexible enterprise network. IBM ensures that its network meets this criterion as it strives to give similar solutions to its clients. With IBM’s global presence, it uses virtually all available network management solutions in the business.

This is a concerted effort to ensure that information within the organization is available to the relevant individual at any time anywhere in the world. This is a major challenge because of the emergence of various devices whose compatibility is as diverse as the clientele usage (IBM, 2012). However, IBM has continuously strived to align its network management software to existing protocols and to tweak it to fit popular mobile devices.

This shows that despite the ease of use and huge presence of a multitude of mobile devices such as smart phones and tablets, they involve a long chain of network elements (IBM, 2012). Some of these elements and resources may involve third parties and hence IBM may not conveniently use them. Some of the popular Network Management Solutions and paths IBM uses include Clouds, Virtualization, Voice-Over IPs, Wireless Networks, Video Conferencing, and Big Data solutions (IBM, 2012).

IT Planning and Processes

IT planning is critical in ensuring that current IT solutions reflect changing technological and market changes. At IBM, as part of its consultancy business, the company advises clients regarding IT planning. Therefore, it is logical that the company should have high end IT planning.

IBM is quite sensitive to changes in the market that may affect its operations. The company forecasts future trends through a careful analysis of current changes in IT. This way the company anticipates future products and sets up teams to develop them. This includes software and hardware. The company is also a huge fan of reverse engineering which trail blazed its success (Sher & Lee, 2004).

IT Strategy and Planning Methodology

Different methodologies may be adopted to carry out planning and strategy in IT effectively. It is crucial to note that IT is the bedrock of current organizational operations. Hence, a possible failure or fault in IT could have catastrophic ramifications. IBM has adopted a leveraged 6-point IT strategy and planning methodology in its operations. The 6-point methodology is outlined below (Horan & Rhodes, 2008).

Indentify Business Strategy and Capabilities

In this step, IBM defines its overall enterprise strategy. This is the strategy developed by top management. Generally, it outlines future goals, vision, and objectives. In addition to this, IBM divides its operations into units and outlines their strategies, for example, the China Unit. Lastly, the business defines operational capabilities that are prevalent to ensuring the realization of the business strategy (Horan & Rhodes, 2008).

Outline Business Process Framework

In this step, business processes are defined, roles are outlined and business scenarios forethought. All this is done in respect to the business capabilities outlined. Additionally, the business indentifies areas that starkly differentiate it from other players in the same filed (Horan & Rhodes, 2008).

Define Targets and Enabling Applications

In this step, IBM indentifies its main targets and strategies. This way, applications maybe developed to cater for key integration points that the company indentifies. Additionally, IBM indentifies components and services that will define its business.

Indentify Core Data and their Sources

In this step, the business indentifies and clearly outlines the most critical data and the data points. IBM cleans these data points to come up with trusted sources of data. These may be clients, suppliers, consultants, or business analysts. The data aids in ensuring smooth business processes. Additionally, IBM develops standards for which to accept or reject a data point (Horan & Rhodes, 2008).

Directions and Support of Infrastructure

In this step, the company defines IT strategy and necessary infrastructure. IBM also defines the standards for the development of that infrastructure and outlines the services for the infrastructure.

Develop Roadmaps

In this step, IBM defines the timelines for the achievement of the plan. It also defines milestones and relevant targets. It also highlights the critical success factors. Lastly, IBM defines future steps after realization of the plan (Horan & Rhodes, 2008).

References

Davenport, T. H., & Brooks, J. D. (2004). Enterprise Systems and the Supply Chain. Journal of Enterprise Information Management, 17(1): 8-19.

Horan, J. & Rhodes, D. (2008). IBM’s Transformation to a Globally Integrated Enterprise. Web.

IBM (2012). IBM Unifies and Optimizes Network Management. Web.

Sher, P. J., & Lee, V. C. (2004). Information Technology as a Facilitator for Enhancing Dynamic Capabilities through Knowledge Management. Information & Management, 41 (8): 933-945.

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