Microsoft Corporation And Intel Corporation Essay

Microsoft Corporation And Intel Corporation Essay

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PROBLEMS: The People lack DEEP KNOWLEDGE: With a gross cut in the number staff of about 200,000 as a result of noticeable decline in performance, IBM 's control continued to wane around 1990s. IBM reported its first huge loss in 1990; its income declined by 74.8% toward the end of the year. Resultantly IBM was relegated to 45th place in the Forbes records. IBM woes further deepened as a result of the promoters’ denial of the fact that their income and reputation were on the dwindling trend. Another factor responsible for the downward trend of IBM around this time is the incursion of new IT companies, Microsoft Corporation and Intel Corporation. The company lack of knowledge in the ensuing consumerism structure brought about by the internet boom and the great need for server/network technologies served as another major source of their decline, as it was obvious enough that they were not investing in research and development.
Defective Organisational Structure and undefined Systems: Further, the lack of defined organisational structure to direct and properly project various business units existing around this period aggravated their failing condition. With more than 120 data centres, and more than 125 Chief Information Officers and another 20 separate business units, the corporation had no specific structure of operation and was using more than one hundred types of configuration techniques. Hence, the company was experiencing three times higher data processing overlay than the market average and the company thus was disadvantaged and could not offer continuous streams of new products, or services.
Dearth of good DECISION: Deep Knowledge issues: Asset and Profitability management: The Company was again bedevilled by its large asset...


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...ion Structure: In the wake of his assumption as the new CEO, Gerstner concentrated on rebuilding and rearranging the organization. All the businesses within the company were categorized to three major groups: H1 for short term mature business, H2 for rapidly growing business, H3 for long term emerging businesses. H1 consists of short term mature businesses. 155 data centre were reduced to 3 regional data centres. He also reduced the number of CIO to one CIO who was responsible to make direct report to the CEO. The system development process was also reengineered, the number of in-house applications decreased from 16000 to 5200. It also integrated new technologies to meet the client demands. As part of restructuring efforts, company also focused on cost reduction process. The company had cut its workforce from 215000 to 86000 and reduced budget for its R&D activities.

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