Abstract
According to the Q4 2015 financial report of IBM (International Business Machines Corporation), revenue for that quarter marked an 8.5% quarter-on-quarter decrease, making it the 15th consecutive quarter with a quarter-on-quarter decrease in revenue. According to the 2015 annual report, the combined annual revenue was $81.741 billion, down by 11.9% from the previous year, indicating the company’s annual revenue had been going downwards since 2012 (In 2012, IBM’s annual revenue was down by 2.3%).
The world will have to embrace cognitive technology, because it provides the most hopeful opportunity to solve the most difficult challenges facing mankind (Shen 2016).
—Virginia C. Rometty, Chairman and CEO, IBM.
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Notes
- 1.
Source: calculated by Wind.
- 2.
60 years old is the retirement age set for IBM’s top leader.
- 3.
IBM is paying GlobalFoundries $1.5 billion in cash—$1.3 billion net, including a $200 million transfer of unspecific assets in the other direction—over three years to take over its own business segment.
- 4.
Both foreign exchange fluctuation and adjustment made with respect to the spin-off of IBM system X are factored into when calculating the sales growth rate.
- 5.
The business model that integrates hardware, software and services and sells the whole package to clients.
- 6.
Pei Xianfeng, CEIBS MBA17, Consultant, McKinsey & Co.
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Acknowledgements
This case is co-written by CEIBS Professor Zhu Xiaoming, Case Writer Chen Dengbiao, Research Assistant Huang Chengyan. IBM provided great support and assistance to this case study.
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Zhu, X. (2019). Case IX: IBM’s Launch of Its Cognitive Business Strategy. In: Emerging Champions in the Digital Economy . Management for Professionals. Springer, Singapore. https://doi.org/10.1007/978-981-13-2628-8_11
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