In Kanter (2009)’s case study “IBM in the 21st century: The coming of the globally integrated enterprise,” the author notes the increasing complications that come with running a globally-integrated enterprise (GIE) in light of the findings of IBM’s IVT5 team. While IBM is considered an “American” company, its increasing global scope throws this identity into question. Questions asked include, “Is IBM no longer a U.S. company? Do we all have to learn Chinese now?” and others, as the primary situation of IBM is that they must generally decide how to operate in an increasingly globalized and internationally-minded world. Issues of evaluating IBM’s global scope, its interaction with ground-level decision makers and points of connection with customers, the growing influence with China, and other factors come heavily into play as IBM reassesses its status in the 21st century.
There are several major issues to be identified regarding IBM and its staff. First of all, the implications for IBM’s GIE status on every level of management and employment needs to be discussed. This chiefly involves finding a way to facilitate a “systems-thinking, initiative-taking, persuasion and diplomacy”-centric view on organizational leadership, which must be cultivated in more managers. For instance, the global nature of IBM means that products have to be marketed in a million different ways in a million different markets depending on their geographic location and culture. Risk management is also a substantial issue, as local issues can become global ones if they are connected to a GIE; the mistake of a single branch can reflect negatively on the company as a whole.
The outsourcing and relocation of jobs and services from place to place in a GIE also has tremendous consequences for local branches of a global enterprise; as jobs shift from place to place, it has positive consequences for the organization but potentially negative consequences for the people as people lose jobs and prestige. The increasing influence of China is also an incredibly substantial issue, as corporate culture and organizational behavior may have to change in light of this greater dependence on China for business relationships. Ultimately, these issues all fall under the blanket concern of what level of the business has responsibilities for what, and if this is localized to region or if it heavily involves the global nature of the organization (Kanter, 2009). Finding effective leaders to facilitate the increasing pressures of IBM’s GIE status is necessary to deal with these particular problems.
In order to address the aforementioned issues, there are a few courses of action which can be taken. For instance, the need to cultivate more global , systems-thinking leaders can come from a sense of transformational leadership, which can be cultivated in people through the proper management training and scouting for the ideal management material. Taking a look at each regional branch in countries across the globe and providing them with transformational leadership training may help to address the issues of having effective ground-level decision-makers who can help innovate new ideas and best represent the company at the end-user level (Rowold & Schlotz, 2009). The issue of marketing a global company to country-centric markets with strong local ties can be done through further educational and cultural training, providing managers and leaders well-versed in the particular cultures being marketed to in order to target these markets most accurately for maximum profitability.
Ultimately, in order to more adequately function in a global marketplace, IBM must take advantage of these international relationships and place a greater focus in China, both from a leadership and services perspective. While IBM absolutely should remain a global company, it is necessary to place a greater focus on where business is strongest and corporate allies are the most influential; if China is where this will occur, this may be necessary. At the same time, it is necessary to continue Palmisano’s transformational aspect of leadership by ensuring that bottom-level decision-makers (e.g. managers, employees in local branches) be given the ability to best serve the customers, as they are the face of the organization. The cultural heritage of IBM would simply expand into a series of international identities, blending together instead of feeling extremely segregated.
Transformational leadership focused on an international perspective and the ability to communicate across cultural barriers is necessary in leaders at all levels of IBM. The proper training and familiarity with IBM’s product line, as well as the home cultures these managers primarily market to, would provide the company with the proper means to best target ideal audiences while representing a more globalized, integrated corporate culture in IBM. While IBM would no longer be a US company, the constant searching for global solutions for their increasingly international marketplace justifies an increased move to a GIO. IBM is currently experiencing great success by mining for innovation and new product ideas elsewhere (including the Global Innovation Outlook (GIO) research effort), cementing the advantages that come from delocalizing and becoming a more fluid global entity. This full embrace of globalization and the unique attributes of the GIE, along with a sense of transformational leadership, is the best way for IBM to maintain its existing dominance in the global marketplace, instead of tying itself geographically to the US.
References
Caldwell, C., Hayes, L. A., & Long, D. T. (2010). Leadership, trustworthiness, and ethical scholarship. Journal of Business Ethics 96: 497-512.
Rowold, J., & Scholtz, W. (2009).Transformational and Transactional Leadership and
Followers’ Chronic Stress. Leadership Review 9: 35-48.
Kanter, R.M. (2009). IBM in the 21st century: The coming of the globally integrated
enterprise. Harvard Business School Publishing, Product: 308105-PDF-ENG.
