?>

IBMA company’s controlling interests and management should never forget that the business is a living, breathing entity.  A company will and always should have its own character and demeanor, much like a person.  Certain companies have been able to create a organizational architecture and business behavior model that is unparalleled in business and is often looked at as innovating in its design.  One such company is IBM.  IBM has over performed as a business for over 100 years.  The critical success for IBM has been found in its core business development through organizational culture, decision making and organizational structure.  It is crucial to understand what a driving force IBM has been in business in the last century and how its culture, structure and decision making defined business.

The foundation of any successful business over a long period of time is reflected in two critical components; “preserve the core and stimulate progress. What preserve the core/stimulate progress does is create an institutional set of processes that map to a very, very deep primal human distinction: our need to believe and our need to create” (Fast, 2004).  IBM has used these business fundamentals to create its core values and business culture.

IBM was founded as three smaller companies in the late 19th century.  At the time IBM was known as the Computing Tabulating Recording (CTR) Corporation.  The name of the company as it stands today, International Business Machines (IBM), was adopted in 1924.  IBM is an international business in over 170 countries with 91 billion dollars in annual revenue (Wikopedia, 2006).   From its inception IBM has been focused on the needs of its customers and not on its need to grow.  That is not to say that IBM has not put considerable thought into its development as a business.  IBM was a leader over the last 75 years in creating a culture of remarkable achievement in business.

With high marks for sales, service and customer satisfaction, IBM has created a very sales-centric culture.  This culture puts a high mark on satisfying the end user of the IBM products and services.  IBM has created a series of training facilities and takes great pride in its extensive orientation process for new employees.  IBM has a rigorous program for managerial advancement.  It is rare that IBM hirers a manager from outside its organization.  IBM has created what some might consider a cult like culture.  IBM prides itself on finding young, ambitious talent in new hires.  These new employees are trained and trained on IBM practices and culture.    IBM makes it very clear that employees will do things the IBM way or work somewhere else.  With a stringent culture in place, IBM will do what it takes to bring up its best internal employees into management.  This preserves the culture and enforces achievement through embodiment of the cultures guidelines.

The IBM culture is successful because it focuses on bringing up employees from within.  The culture works because it has always worked.  IBM does not attempt to do something in business as its core value that no one else has ever done.  IBM simply creates a very unyielding culture that emphasizes the satisfaction of the customer as the most important part of their business.  With the values of the customer in mind, IBM has created a culture its employees need to get behind.

In identifying a successful company, a person must appreciate that the culture of a business is its soul.  After the vision of a business the culture is what drives the rest of the company’s direction (Collins, 1994).  Many companies lose focus on their need to guide their culture as they get larger and the end product often suffers.  IBM has made sure this does not happen because they have used satisfaction as the core value of their business, building their company culture around it.  In the paradigm of the seven primary characteristics of organizational culture, IBM most reflects attention to detail.  From the signature IBM white shirts, black ties and dark pants; IBM screams professional service and satisfaction to the customer.  IBM has created facilities for training, research and development of services and products that are geared toward the complete fulfillment if their customer’s needs.

For a complete analysis of how IBM has used its culture to provide a model for world class management, feel free to download the complete whitepaper:  Organizational Behavior and IBM

Comments are closed.