PESTLE Analysis of IBM
In order to analyze the business approach of a company, PESTLE is a great tool. It helps to identify its political, economic, social, technological, legal, and environmental factors. These factors play an important role in running the business successfully. Companies like IBM must utilize this tool to determine their position in the competitive market and improve the business.
Political Factors | IBM
In the information technology sector, IBM is one of the most reputable corporations. The company must keep government policies and decisions in mind because it operates globally in more than 170 countries. Many countries in the world are trying to digitalize, and it opens various opportunities for the company in developing countries like India. They must keep an eye on every factor before executing any plan. It will create plenty of growth opportunities for IBM in the information technology sector.
On the other hand, the growing internet and social media trend is another door of opportunity for the company. They can benefit from their services like privacy and data security to consumers. It is also crucial for the company to understand the tax policies of different countries to avoid any disturbance in the future. Any conflict between China and the US will also disturb the business performance of IBM. These are some political scenarios that can hurt the business of tech giants.
Economic Factors | IBM
IBM should pay attention to economic factors like labor market conditions, saving rates, foreign exchange, and other economic-related scenarios as a global corporation. By understanding the economic climate, IBM can predict the growth rate. To save cost, the company outsources PCs. IBM can focus on this factor to save more production costs. Moreover, the company also announced to begin a new company that will manage its infrastructure services. In this way, the company can pay attention to other areas like cloud computing, artificial intelligence, and digital transformation.
Social Factors | IBM
Companies operating at the organizational level are highly influenced by cultural settlements, trends, and values. The company can identify the social factors of a country by identifying its demographic conditions, buying habits, trends, and power dynamics. The company has a dedicated center for protecting the privacy of consumers. Also, the company has strict principles in developing artificial intelligence-based systems. They value their workers and employees because they are the strength of IBM.
Moreover, the company is also expanding its workforce to bring some innovation. The company aims to reduce the risk of cybercrime. They also engage students and professionals through their open P-Tech learning platform. They have also designed SkillsBuild for job seekers.
Technological Factors | IBM
Being a tech organization, keeping your system highly innovative or up-to-date is essential. The growing demand for cloud services opens various opportunities for the company.
It offers IBM Watson, IBM Cloud, and other services to companies in the IT-related sector. They have built a research center and spent a significant sum on its innovation. With the help of this research center, the company is developing the latest services and products for users. They are also working on hybrid cloud solutions, quantum computing, and blockchain. There are so many other resolutions on which the company is working very hard. It is an excellent chance for the company to turn it’s millions of dollars business into billions of dollars.
Legal Factors | IBM
It is crucial for IBM to thoroughly understand the country’s legal framework in which it wants to operate. It will help to protect the company from legal concerns and lawsuits. Moreover, it will keep legal problems at bay. Without knowing its legal conditions and environment, the company cannot even think about entering a new market or region.
IBM should understand the labor laws, intellectual property rights, and other legal factors before venturing into a new country.
Environmental Factors | IBM
Environment-related factors such as regulations, norms, and laws can affect the business of IBM. As a global corporation, it is imperative for the company to carefully follow all the environmental laws in order to keep eco-conscious people happy. Moreover, the company is taking various useful initiatives for protecting the environment. They are focusing on renewable energy sources and trying to reduce greenhouse gas emissions. They have set a target of net-zero greenhouse gas emission. On the other hand, they collaborate with partners to resolve sustainability issues.
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