Industry Analysis. Leyva, M., Hechavarria, J., Batista, N., Alarcon, J. 1. Increasing the adoption of cloud services provides a good opportunity for IBM. For example, new business solutions for online operations can address such demand and further grow IBMs business. However, despite such trend of improving protections, the company still faces issues in developing markets. 3. The aim should be to maximize stability and growth while protecting the business from threats in the remote or macro-environment. IBM. In case you need the complete report please purchase using the buy options displayed. The business and marketing strategies are also influenced by migration. In. Nonetheless, cybercrime is also marked as an opportunity in this external analysis. Wall, S., Minocha, S., & Rees, B. The corruption can influence various business operations, ranging from licensing, contracting, fraudulent deals to frequent lawsuits. Exploring strategy. should invest in disruptive technologies to maximize the profits and re-invest the profits for future disruptive technologies. However, IBM's annual revenue has remained flat, and the company's Watson software system has yet to deliver the anticipated rebound. (2009). To conclude, the above IBM PESTLE Analysis highlights the various elements which impact its business performance. Ranging from political factors to environmental factors, each factor comprises various variables that influence the strategic decision making process of business organizations like IBM. IBM. We invest deep in order to bring you insightful research which can add tangible value to your business or academic goals, at such affordable pricing. High unemployment signals the availability of surplus labor at comparatively lower wages. These new entrants have interests in diversifying their businesses and impose a moderate threat against the company (Read: Porters Five Forces Analysis of IBM). A well-developed infrastructure facilitates the business environment and increases the growth potential of the gold industry in the respective country. Thus, this external analysis case helps determine the strategic options for the company. This element of the PESTEL/PESTLE analysis shows that IBM has growth opportunities based on market penetration, customer service, and online services. Technology' is the fourth factor of PESTEL analysis. The political factors in the IBM PESTLE Analysis can be explained as follows: IBM is one of the biggest Information Technology companies in the world headquartered in the US and operates in more than 175 countries. should study how intellectual property rights are protected in the host country and make the business strategies accordingly. MBA Skool InstallCourses Home Courses Concepts SWOT * They will have some level of impact on it. Issa, T., Chang, V., & Issa, T. (2010). Help, Academic Related: Macroeconomic Factors: How They Impact the Economy Subsidiaries, Partnerships and Collaborations Report. in choosing the right market segment/segments with high growth potential. This report is shared in order to give you an idea of what the complete Key Performance Indicators (KPI's) Report will cover after purchase. In 2021, the annual expenditure was $6.567 billion. This report is shared in order to give you an idea of what the complete Stakeholder Analysis Report will cover after purchase. Intellectual property regulations are designed to protect the companies' patents and valuable ideas. Swot analysis of IBM. The remaining section under "Weakness" is available only in the 'Complete Report' on purchase. Economic recession and changing government policies can impact business operations IBM Competitors Another technological factor to consider is the emergence of artificial intelligence (AI). The social factors that have an impact on IBM include demographics, culture, values, and attitudes. IBM SWOT and PESTLE analysis evaluates the most influential and innovative company that provides hardware, software and services to businesses and governments globally. This has allowed IBM to expand its operations into new markets and to continue to invest in research and development(Date, 2006). These laws are designed to ensure that companies do not abuse their market power or engage in corrupt activities. Please note that you agree to receive email updates from us on our new reports and solutions. Other regulations, such as antitrust laws, can limit IBMs ability to merge with other companies or acquire certain technologies.if(typeof ez_ad_units!='undefined'){ez_ad_units.push([[336,280],'howigotjob_com-large-mobile-banner-1','ezslot_13',199,'0','0'])};__ez_fad_position('div-gpt-ad-howigotjob_com-large-mobile-banner-1-0'); IBM is a global company with operations and customers in many different countries. Leveraging technology for environmental protection, Extends the strategy and design expertise of IBM iX, Strengthened the IBM Connections portfolio and Launched new offering - IBM Connections Engagement Center, Strengthens IBM's Securitys portfolio by adding C-Suite decision making solution, Expand disaster recovery services for Hybrid cloud, Risk management and regulatory compliance, Transform regulatory compliance with Watson, Help developers modernize mainframe applications for digital business, IBM Segmentation, Targeting and Positioning (STP) Analysis. Technology integration initiatives across industries, 1. 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Intellectual property issues also face the company, especially in efforts to expand operations in developing countries. IBM SWOT Analysis Strengths First mover in cloud computing solutions for enterprises. Additionally, IBM must be sensitive to cultural differences when marketing its products and services. Over the next five to ten years, the worldwide quantum computing business is expected to expand from hundreds of millions of dollars to billions. If you have BIG dreams to score BIG, think out Technological trends can be used to start the creative social media campaigns for developing online brand communities. The PESTLE / PESTEL analysis for IBM is presented below: Source: Company website and other reliable sources. PESTLE analysis is a framework which is imperative for companies such as IBM, as it helps them to better understand market dynamics & improve their business continuously. The environmental environment can also affect IBMs operations. 27.3 PEST Analysis. IBM. What are some opportunities that IBM can benefit from? Save my name, email, and website in this browser for the next time I comment. Within PESTEL analysis, political factors exert a strong influence on the long-term sustainability and profitability of IBM. In case you want this report emailed straight into your email inbox, kindly share your details below. In the IBM PESTLE Analysis, the environmental elements affecting its business are as below: Environmental norms, laws, and regulations fluctuate depending on the market. Regulatory bodies emphasis on ensuring compliance with environmental norms is altering the product innovation priorities. Operating in countries with high corruption level and weak law enforcement makes the business environment increasingly unpredictable for IBM. In response, IBM has invested heavily in developing new cloud-based services and products. Moreover, the business performance of IBM. Based on. The sociocultural situation can present challenges in IBMs operations and determine the overall condition of the remote or macro-environment. To gain an understanding of the external forces that may affect IBMs operations, a PESTLE analysis of the company may be conducted.if(typeof ez_ad_units!='undefined'){ez_ad_units.push([[728,90],'howigotjob_com-medrectangle-3','ezslot_6',191,'0','0'])};__ez_fad_position('div-gpt-ad-howigotjob_com-medrectangle-3-0'); Political: IBM operates in a highly regulated industry with governments around the world playing a major role in the technology sector. For example, higher sales revenues are expectable, as target customers are increasingly capable of purchasing information technology products from the company. This has had a negative effect on IBMs sales and profitability. We invest deep in order to bring you insightful research which can add tangible value to your business or academic goals, at such affordable pricing. to adopt the niche marketing strategies. PESTEL analysis is critical to understand the external threats & opportunities arising because of the macro environment . The marketing department of IBM. It is an acronym for political, economic, social, technological, environmental and legal factors that shape the macro business environment. IBM. IBM PESTEL/PESTLE Analysis & Recommendations IBM's office building in Bratislava, Slovakia. Moreover, a well-developed governance system with a democratic political environment makes the business environment more comfortable for international business organizations like IBM. We invest deep in order to bring you insightful research which can add tangible value to your business or academic goals, at such affordable pricing. Developing a multi-criteria decision making model for PESTEL analysis. SWOT Analysis Strengths IBM's core strength lies in its System/360 and System/370 mainframe series. * By clicking on "Buy Now" you agree to accept our ", On purchase the IBM SWOT & PESTLE Analysis PDF report will reach you. Technological change can impact IBM in a number of ways. IBM announced its third consecutive goal for the use of renewable electricity in February 2021, as well as its fifth consecutive goal to reduce greenhouse gas emissions and a new goal to reach net-zero greenhouse gas emissions. It is important for IBM. PESTEL Analysis Chater 4. The company operates in over 170 countries and is affected by economic conditions in each of these markets. A detailed understanding of the economic environment can help IBM. Technologies and related changes determine the business tools and equipment available in the information technology industry. You can use the following in your reference section in order to give credit to the source. by adamkasi | Apr 9, 2023 | Companies | 0 comments. Factors such as inflation, exchange rates, and economic growth can have a major impact on IBMs operations. IBM also worked on manufacturing the Summit, an analysis of a companys strengths, weaknesses, opportunities, and threats, What is PESTLE Analysis? Subscribe now to get your discount coupon *Only 1, pp. A rigid labour market with powerful worker unions can cause various problems for IBM . In order to stay ahead of the curve, the company needs to continually invest in research and development (R&D). Addressing the external factors increases IBMs rate of success in boosting the performance of its global business. Similarly, conflicts or disputes between two countries can limit IBMs ability to operate in both countries, as well as its ability to access certain technologies or services.if(typeof ez_ad_units!='undefined'){ez_ad_units.push([[336,280],'howigotjob_com-large-mobile-banner-2','ezslot_16',601,'0','0'])};__ez_fad_position('div-gpt-ad-howigotjob_com-large-mobile-banner-2-0'); One of the primary economic factors that affect IBM is the global economy. IBMs consumer-focused products, such as its personal computers, must meet the needs and expectations of consumers to remain competitive. Moreover, considering the development and maturity level of technology in the respective market is also important. Increase in adoption of e-commerce by consumers, 1. The organization may also study the industry specific taxation policies to understand the host government's priorities and interest in developing industries. Cuts down my effort to surf through heaps of redundant data.-Alexandra MookiMajor in Business Administration, Carnegie Mellon University, This website has an amazing support team. Sitemap. For different referencing styles and detailed guidelines, please click here. Proposal, Assignment Writing Thus, in this element of the PESTEL/PESTLE analysis, considerable opportunities and threats affect IBMs standing in the global market. This is reflected in their commitment to achieving net-zero emissions of harmful gases by 2030 and to cut carbon emissions by enacting a carbon tax. The first factor to consider is the rise of cloud computing. Additionally, the company is subject to the economic cycles of the markets where it operates, which may affect its sales and profits.if(typeof ez_ad_units!='undefined'){ez_ad_units.push([[580,400],'howigotjob_com-medrectangle-4','ezslot_4',193,'0','0'])};__ez_fad_position('div-gpt-ad-howigotjob_com-medrectangle-4-0'); Social: IBM is a global company and must be prepared to address the social needs of the markets in which it operates. Bureaucracy and corruption negatively influence the business environment. An Important Business Analysis Tool. For example, IBMs healthcare solutions must be compliant with regulations in each country they are sold in. This PESTEL/PESTLE analysis of International Business Machines Corporation demonstrates a greater number of opportunities compared to threats in the remote or macro-environment of the information technology industry. The rapid technological advancement and technological diffusion across the globe have increased the importance of understanding technological factors during the strategic decision making process. Andr Cavalcante, S. (2013). This external analysis also shows that the company can grow its business through products that specifically target online demand and online markets. This element of the PESTEL/PESTLE analysis shows social trends and changes that affect how customers and employees interact with the information technology business and its products. These factors play an important role in running the business successfully. By scrutinizing the external environment, IBM can gain insights into how external forces may shape the future of the corporation and its operations. must adjust its business management practices while entering in markets with high or low power distance. as they determine the overall economic environment of the country. 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