Comments
Rometty's Past Reveals IBM's Future
Newest First  |  Oldest First  |  Threaded View
BOBBRUNO
50%
50%
BOBBRUNO,
User Rank: Apprentice
11/3/2011 | 2:50:50 AM
re: Rometty's Past Reveals IBM's Future
There is when you're the leader in patent filing every single year. IBM is just that - they invest lots on patents to keep the competition away. That, the getting out of businesses that lost their marging (like printers, PCs and similar stuff) and buying companies when they pick their researches wrong. I'm not saying IBM is entirely low-risk/high-margin (hech, I'd buy all the shares I could if they were that), but they invest a lot so that their products are.

Also, that was not the core of my point - my point was that IBM doesn't like the consulting business, because it's too risky, too specific and non-reusable and mostly because it isn't based on getting revenue from their intellectual property, but on creating intellectual property for the consulting clients. That means no long-term cashflow and little repeatability, two "no-no's" in IBM.
cxf
50%
50%
cxf,
User Rank: Apprentice
10/31/2011 | 2:50:57 PM
re: Rometty's Past Reveals IBM's Future
Get real, there's no such thing as a low risk high margin business unless you're Bernie Madoff, and even then..
BOBBRUNO
50%
50%
BOBBRUNO,
User Rank: Apprentice
10/29/2011 | 1:51:42 AM
re: Rometty's Past Reveals IBM's Future
The idea sounds great, but I don't buy it. IBM is entirely driven, from strategy to daily operations on high-margin, low-risk markets. That's why they gave up on PCs and that's why they invest so much on research and IPs.

Consulting, on the other hand, is a high-risk business, with medium, but unsteady margins - it's no cash cow. Besides, it's based on creating value for the client, who stays with it. All of this makes it go against all the culture, strategy and operations of IBM. I worked for PwC, and I was on the bunch that was bought by IBM. One by one, I saw the people with business consulting skills leave after getting tired of fighting a losing battle against culture, policies and rules that were designed to keep IBM on the low-risk, high-margin that's not consulting.

I wish Rometty all the luck, I've got lots of friends there yet. But the tip of the spear got blunt, and the consulting muscle is weak in there now. And I don't see IBM's investors interested in changing the way IBM pays them for their money. Mostly, I don't see IBM giving up the short-term profitability to change into a consulting company.

The ERP/Apps market, I can buy that. But that's not business consulting, that's software implementation. And it's about time IBM got there, instead of seeing its partners get bought by the competition.
Lillyyy
50%
50%
Lillyyy,
User Rank: Apprentice
10/28/2011 | 8:47:41 PM
re: Rometty's Past Reveals IBM's Future
Rometty's Past Reveals IBM's Future Really raelly i have best news, you want work on line? Read about it here MakeCash5com
Guest
50%
50%
Guest,
User Rank: Apprentice
10/27/2011 | 4:15:16 AM
re: Rometty's Past Reveals IBM's Future
I seriously doubt Rometty is going to focus on consulting services. IBM already has a health care consulting practice as well as all of those other verticals you mentioned. As consulting is a relationship based business as compared to an IP based business, the leakage from an acquisition is too high. All of IBM's recent acquisitions have been software companies.
Guest
50%
50%
Guest,
User Rank: Apprentice
10/27/2011 | 4:09:56 AM
re: Rometty's Past Reveals IBM's Future
Yes, in addition to the business v. consumer aspect, using revenues as a measure of size is not meaningful (as people equate "largest technology company" with leadership and market control). The best measure is market capitalization where IBM is number one in enterprise IT followed by Oracle. Microsoft and IBM are about equal in market cap, but Microsoft obviously has a huge consumer or client side presence.
Guest
50%
50%
Guest,
User Rank: Apprentice
10/27/2011 | 4:00:06 AM
re: Rometty's Past Reveals IBM's Future
HP is the largest in revenues... which is meaningless. IBM intentionally dropped PCs and components, which lowered revenue but improved profitability. HP is trying to lower their revenues (PC spin-off) to focus on higher value-add, higher profit businesses.
PMcDougall
50%
50%
PMcDougall,
User Rank: Apprentice
10/26/2011 | 5:58:26 PM
re: Rometty's Past Reveals IBM's Future
@kt1122. The story states that IBM is the world's largest BUSINESS tech company. If you take away HP's consumer sales, it's considerably smaller than IBM. Thx for reading.
HenryReardon
50%
50%
HenryReardon,
User Rank: Apprentice
10/26/2011 | 5:30:19 PM
re: Rometty's Past Reveals IBM's Future
HPQ is larger in terms of revenue... $126B compared to IBM's $107B... but IBM is larger in number of employees.... 426,751 compared to HPQ's 324,600... and IBM is larger in terms of market capitalization.... $211B compared to HPQ's $50.8B.... I guess it depends on what is used for the measurement.
kt1122
50%
50%
kt1122,
User Rank: Apprentice
10/26/2011 | 5:00:04 PM
re: Rometty's Past Reveals IBM's Future
IBM is not the world's largest technology company.. HP is.


The Business of Going Digital
The Business of Going Digital
Digital business isn't about changing code; it's about changing what legacy sales, distribution, customer service, and product groups do in the new digital age. It's about bringing big data analytics, mobile, social, marketing automation, cloud computing, and the app economy together to launch new products and services. We're seeing new titles in this digital revolution, new responsibilities, new business models, and major shifts in technology spending.
Register for InformationWeek Newsletters
White Papers
Current Issue
InformationWeek Tech Digest - July 22, 2014
Sophisticated attacks demand real-time risk management and continuous monitoring. Here's how federal agencies are meeting that challenge.
Flash Poll
Video
Slideshows
Twitter Feed
InformationWeek Radio
Archived InformationWeek Radio
A UBM Tech Radio episode on the changing economics of Flash storage used in data tiering -- sponsored by Dell.
Live Streaming Video
Everything You've Been Told About Mobility Is Wrong
Attend this video symposium with Sean Wisdom, Global Director of Mobility Solutions, and learn about how you can harness powerful new products to mobilize your business potential.