IBM's Innovation Strategy and Business Process Management

The report evaluates IBM's innovation strategy and business process management. It highlights the need for IBM to integrate change in process and innovation within the frameworks of business. The report also encompasses the reflection of the process design of the business along with the improvement that has been or is being done in IBM. It evaluates the performance of the processes and potential change management and risk issues. The subject is Business Process Management, and the course code is not mentioned. The course name and college/university are not mentioned.

Business Process Management

Executive summary
The report illustrates the critical evaluation of the innovation strategy incorporated by IBM. The
evaluation of processes, infrastructure and organizational structure of IBM has been conducted
from critical perception. The key emphasis of the report has vested on the need of IBM to
integrate change in process and innovation within the frameworks of business. The report also
encompasses the reflection of the process design of the business along with the improvement that
has been or is being done in IBM. There has been depiction of process performance evaluation
along with potentials management of change that the company can undertake. There have been
highlights of the risk issues in accordance to the provided case study.

Contents
Part 1 : IBM’s need for innovation and process changes................................................................3
Innovation framework..................................................................................................................3
Business transformational and integration...................................................................................4
Innovation culture........................................................................................................................4
Organizational structure and design.............................................................................................5
Funding model.............................................................................................................................5
Business transformational and integration...................................................................................5
Part 2: Business Process Design and Improvement.........................................................................5
Innovation strategy.......................................................................................................................5
Leadership team and other key stakeholders...............................................................................6
Key business processes of innovation..........................................................................................6
Project selection and project management...................................................................................6
Role of technology in innovation.................................................................................................6
Part 3: Process Performance Evaluation..........................................................................................7
Evaluating investments................................................................................................................7
Process performance management-methods and metrics............................................................8
Balanced scorecard method.........................................................................................................8
Process measurement and product development cycle time........................................................8
Part 4: Potential Change Management and Risk issues...................................................................9
Dealing with failure.....................................................................................................................9
Barriers and enablers of innovation.............................................................................................9
Critical success factors...............................................................................................................10
Lessons learnt and path for future..............................................................................................10
References......................................................................................................................................10

Part 1 : IBM’s need for innovation and process changes
Innovation framework
IBM has been observed to have interconnected dimensional approaches for innovation across the
dimensions of offerings/products, business models and process. These kinds of innovations that
are integrated by IBM are facilitated by a specific category of sustaining enablers These pertain
to the fact that IBM as an organization can facilitated the concept of ideation as well as creation
of an organizational culture that encourage innovation. The innovation framework of IBM has
been observed to be relying and focusing on offerings and market. IBM has been observed to
seek for new ways of reaching out and fulfill the needs of the stakeholders and customers. As per
Balko, Vasudevan & SAP (2014), the company has believed on the fact that business
organization which is successful in integrating innovation by collecting information on the
existing trends, analyzing the environment and the future realities of the projects along with
making strategies and planning for the determination of the initiatives that are required to be
taken (Balko, Vasudevan & SAP, 2014).
IBM has been working on the concept that innovation of services and products happen to
enhance and improve the old offerings along with formulating new offerings. IBM also has been
conducting the business operation on the concept of changing the deliveries of the organization
to its audience and customers in a materialistic manner. The company has been observed to
believe that the concept of market innovation which happens to have material implications on the
set of audience, stakeholders or customers that are being targeted by the company. It has also
been observed that the company believes in changing the manner in which retention or stretching
of the customers is conducted (Chang, 2016).
Further, it has been noted that IBM works on the principle of paths or channels which facilitate
delivery of innovation in materialistic manner which further changes the manner in which a
business organization enters into the market and established connection with the audience. It also
follows the similar concepts regarding distributing or delivering the services or products.
IBM also believes in integrating new approaches to enterprise or business models for the
extension and structuring of the enterprise as a whole. The company has been functioning on the
fact the having innovation within its frameworks will bring flexibility, agility and responsive
features to the dynamic scenarios within the ecosystem of the industry. This is done by the

company for sustaining the differentiating value from the business competitors in the market
along with gaining cost efficiencies from the business operations. As per Conge(2015), IBM
believes and functions and believes on the fact that being an innovative organization increases
the comprehension of the fact there are many business organization that functions in the market
(Conger, 2015). However, to gain a competitive advantage in the market scenario, it is very
crucial to have a dynamics, complex and interdependent ecosystem and networks of
interdependent industry. IBM also believes that in order to bringing innovation in the business
models would bring sustainability in the ongoing value and differentiation in regards to service
delivery and growth in the business. In case of operations, IBM considers these elements to be
filled with key opportunities and scope for growth and innovation. It considers that innovation
can occur at the areas that have core functions of business. It also has to consider the fact that
successful innovators happen to overcome challenges in business.
Business transformational and integration
It has been observed from the case study that IBM as a company has to consider the issue of
moving or adopting the demand model in all three dimensions of business frameworks. IBM
needs to focus on innovation in the business transformation (Hammer, 2015). The company has
enhanced understanding of the need of innovation in the aspect of business transformation which
would project improvement in the overall business altogether.
Innovation culture
IBM has its business operations on the basis of making sustainable collaborations on which
would lead to enhanced innovation culture. According to Müller et al (2016), the culture of IBM
has been encouraging the open sharing of ideas among the colleagues and gain knowledge from
others’ experiences. This culture then facilitates the continual improvement and innovation in the
organization through learning culture (Müller et al., 2016). This has encouraged the business
organization to change its competencies of leaderships. The culture of IBM has been facilitating
execution and generation of idea a and creativity which assist in transformation of the regular
practices and management systems of the company.
Organizational structure and design
It has been understood that organizational structure has the understanding of integrating
innovation within the organizational structure and design on the concept that ownership for

organizational ownership is eventually the accountability of the employee. The company is
oriented towards maintaining and creating innovation programs across the entire organization.
The company believes that innovation is an integral part of the strategic focus of every unit of
business instead of setting a discrete unit within the business frameworks to be accountable for
innovation (Roeser & Kern, 2015).
Funding model
As per Spanyi (2015), IBM can realizes the need to integrating a model for investments funding
that would assist in reducing the investment cost of the clients in regards to incorporation of
innovation. For encouraging innovation, the projects can be reviewed and chosen on the basis of
a specific set of requirements and criteria (Spanyi, 2015). These criteria would include content
reach, strategic fit and range along with market planning and deliverables.
Business transformational and integration
IBM has been considering the challenges of adopting the demand model along with focusing in
the IT enablement through business transformation. The strategy of the company would project
towards the culture treat of labor based and making forward initiatives to move from various
products top different solutions. The company has been found to have recognized differential
processes of business that it desired for transforming to “On Demand”. The company has
realized its scope to undertake wider initiatives regarding business transformation which would
drive innovation.
Part 2: Business Process Design and Improvement
Innovation strategy
It has been observed from the case study that most of the innovation strategy for information
technology of IBM is driven by the Global Technology Outlook. According to Schmiedel,
Brocke & Recker (2015), the emerging trends of GTO highlights of the company has been
prominent in the hardware, software and services technology which are expected to have
prominent impacts in the sector of information technology in the upcoming years (Schmiedel,
Brocke & Recker, 2015). There has been identification which signifies that tecjhnol0ogeis might
happen to have disruption in the existing frameworks of business which have the potential for
creating new scope and opportunities. These also facilitate new values of business to the

customers of IBM. Through the inclusion of GTO, the company has been found to focus on
innovation in the areas such as system and technology of hardware, metadata, enterprise
resolution, and innovation in various services. As per Trkman et al (2015), IBM also happens to
believe in the adoption of business model of “On Demand” which is a crucial step that facilitates
innovation in the company (Trkman et al., 2015). Moreover, the company is found to consider
innovation as an open, collaborative and global in nature that has been facilitated by technology.
There has been a major initiative by the company regarding its innovation strategy as FOAK
which denotes to First of a Kind. IBM has identified that in order to innovative and develop in
future, the company needs o have an innovation strategy that integrates historical research and
development in its capabilities of business insight. The company also believes in patents which
are an integral part of the innovation strategy of the company.
Leadership team and other key stakeholders
From the case study it has been observed that IBM has been integrating its leadership model has
been fostering a psychological and physical working environment wherein innovation is
developed. The company has also been fostering innovation through the company’s leadership.
Key business processes of innovation
The company has been integrating the process in business along with underlying technologies
which are improved and changes on a regular basis to encourage innovation. IBM has been
making continuous efforts for identifying the business processes that it used to use and is making
strategies for transforming them On Demand (Vom Brocke et al., 2014).
Project selection and project management
The selection of project process of IBM varies on the basis of if the idea is in the area of research
or development of products. In such a case, the company has been observed to be using a process
that transforms creative ideas into various projects. These projects are found to be funded by the
board of investment review.
Role of technology in innovation
IBM has engaged a technology team within its business infrastructure which takes charge of
devising future possibilities if developing technology for the business organization. This team
also determines the orientation and the technological aspects in which IBM needs to make
investments. The company has been making transformations regarding selling the integrated

solutions instead of the components which has been successful with standardization and
commoditized of information technology. It has been observed that the company focuses in the
latest trends in the technology and makes efforts to bring innovation accordingly. There are three
key technology enables for the efforts of IBM regarding innovation such as Jams, ThinkPlace
and intranet (Tregear, 2015). The company has been considered technology the basis of
transformation of the business. The company has been successful in leveraging information
technology and building more agility along with responsiveness into the enterprise for gaining
effectiveness in business. The platform of “jam” has been incorporated by the company in order
to gather all the information from its employees regarding innovation and various other issues.
Part 3: Process Performance Evaluation
Evaluating investments
It has been observed from the case study that so as to initiate effective funding to certain
transformation of e-business of IBM which further assist in driving innovation, the company has
developed a model which it has been utilizing for many years. It has also been noticed that the
budget of the company that is specified for innovation in the information technology is allocated
for investments regarding transformations in the business frameworks. The company has been
making initiatives regarding development of investments and orients them with the strategic
intent of the organization in the aspects where the company can forecast bigger opportunities.
This has been facilitating the company in creating balance in the offerings of portfolio so that the
company is being efficient in making investments in the emerging opportunities and the current
products (Van Der Aalst, La Rosa & Santoro, 2016). Further, the company has been integrating
enablers of technology which has been optimizing the investments in information technology for
the enhancement of the performance of company’s finances and further makes funding regarding
the transformation efforts. It has been observed from the case study that the leaders of the supply
chain in IBM have not identified the requirements of evaluating the orientation of the
programmatic investments in aspects of innovation in a direct manner. The company has not yet
devised any strategic process or planning for considering and evaluating innovation as a separate
initiative. The evaluation tool that currently IBM uses can be devoted to the recognition by the
external community as a whole.

Process performance management-methods and metrics
It is noticed from the case study that IBM has incorporated the evaluation technique of “post –
launch performance evaluation” for assessing the performance of the process management. This
measurement metrics is used and performed at the end of the decision checkpoint in the entire
process of integrated development of product (van der Aalst, 2015). The company has been
making collaborations for ensuring success which is mostly conducted through as set of
measurements metrics of performance that are oriented for cross-functional groups or teams.
Balanced scorecard method
It has been observed from the given case study that IBM has been using the method of balance
scorecard for measuring and tracking the impact as well as the success of innovation of products.
It has been seen that suitable measurements happen to differ from one unit of business to the
other. However, all the initiatives of business of the company are expected to function in the
measurements in the form of a balanced scorecard. The company has been using the method of
balance scorecard by referring to the following questions such as how the customers perceive the
business of the company (van der Aalst, 2015). Further, the company also undertakes the aspects
in which the units of business need to make improvements in order to develop better innovation
strategies and products as a whole. The company also evaluates the aspect such as the scope and
opportunities of the company in regards to the learning, improving and creating value on a
regular basis with the help of balance scorecard. The ways in which the business appears to the
customers and the other external stakeholders are also assessed through the balanced scorecard
of the company.
Process measurement and product development cycle time
The process of product development of IBM has been observed to utilize four capabilities which
are highly significant for the company. These relate to the process of market planning, capability
of portfolio management, management of platform and management of pipeline. It has been
understood from the case study that the company uses IPD metrics and measurements of
transformational progress for measuring the process of product and innovation development. The
company has been defining its product development cycle time on a regular basis .the company
has been undertaking such regularity within its business frameworks because the time elapsed
from the beginning of the phase or concept has to be evaluated till the general availability of the
product (Van Der Aalst, La Rosa & Santoro, 2016). The company has been including different

processes which encompass quote –to-cash, manufacturing times of processing, order receipt to
the delivery of orders, etc.
Part 4: Potential Change Management and Risk issues
Dealing with failure
From the case study, it has been understood that the approach that IBM takes to address failure
and the manner of application of the innovation by the company depends largely on the aspects
of the company which is engaged. The company has been making consistent approach towards
the recognition, highlighting and making correction initiatives to every scenarios of business
which ash also resulted in non-fulfillment of the objectives of the company. The company can
continue to make corrective actions which are built on varying approaches that happen to include
wide variety of approaches to innovation. There is no definite use of acceptable failures,
however, certain metrics and objectives are considered for the purpose. It has also been noticed
that the company has not devised any particular metric for assessing failure rate.
Barriers and enablers of innovation
There are potential barriers that can issues for the integration of innovation by the company
along with making the company miss the opportunities in regards to recognize the breakthroughs
in the new ventures. These barriers include the insufficient provisions of value or ignorance to
the strategic business establishment by the management system which may reward the execution
of direction towards the short term outcomes in business. The excessive preoccupation of the
company with the markets that it is currently catering to and the exiting offerings that the
company is facilitating can act as potential barriers for the company in regards to the
incorporation of innovation (Schmiedel, Brocke & Recker, 2015). The model of business of IBM
has been making increased focus in the sustained profits along with the earnings for every share
developments instead of taking initiatives for driving higher ratios of price to the earnings has
the potential to provide restrictions to the incorporation of innovation. Further, the approach of
the company regarding collecting and utilizing the insights of the market has been inadequate for
the new markets which is one of the barriers in this regards to innovation in the company. The
company seems to lack established disciplines for the purpose of selecting, funding,
experimenting and terminating fresh new potential developments for business. It has also been

anticipated that after making the selection, most of ventures in this regard would fail in execution
it has in the past for the company (Roeser & Kern, 2015).
Critical success factors
It has been observed from the case study that IBM has been establishing a culture that identifies
and rewards the innovative thought process for gaining success in the business. The critical
success factors for the company can be devoted to the aspect of collaborative innovation which is
one of the prominent elements in this regard. This element has been encouraging innovation
along with assisting in sustainability in this regard in the company (Hammer, 2015). The belief
of the company regarding making collaboration for maintaining and improving the growth of the
economy along with encouraging competitiveness has been success factor for the company. This
has assisted the company in participating in different collaborative initiatives in order to ensure
the successful implementation of the initiatives that extends the capacity and capabilities through
the partners it has for collaboration.
Lessons learnt and path for future
The lesson that IBM has learned in regards to the requirements for bringing enhancements in
business relate to the making plans regarding communicating strategic intent for pursuing scopes
and new opportunities for growth (Conger, 2015). The company has learnt lessons regarding
identification of prominently short list for initiatives of emerging business opportunities. The
path for future of the company lies in identifying the alignment issues regarding cross groups
which IBM needs to focus on. There has to be support of the senior management in a continuous
manner which is needed for gaining sustained levels of investment. These initiatives have to be
aligned in the orientation of the achievement of targets and milestones.
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