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Big Blue Wields the Knife Again

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IBM
1. The strategy that IBM is monitoring and controlling within its IT business is the strategy of price leadership in IT services. It has monitored its own costs and the performance of competitors from India. In this context, it has reduced its services personnel in North America. Further, IBM is keeping a close tab on the cost structure of competing Indian companies. To reduce its own costs IBM has expanded its own personnel with more employees recruited from India. The purpose is to reduce labor cost and make more profit. So the overall strategy that IBM is monitoring and controlling within its IT business is cost leadership in IT service.
2. The implementation controls and industry comparison measures that IBM appears to be using to evaluate and control its ongoing implementation and execution are per unit labor costs. The evidence that IBM is using this measure of control and evaluation is that IBM is continuously reducing its employees in high cost countries and is employing more people from low cost countries including India. In this context it is also important to consider that IBM has adopted the Learn Operation discipline developed by Toyota for making cares. IBM has proceeded to adopt these principles to its global business organization. Overall the measure used ...

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