International Business Machine

IBM

Abstract

International Business Machine (IBM)  

Introduction

International Business Machines (IBM) traces its history back to the 19th century with the development of the first dial recorder in 1888; it was invented by Dr. Alexander Dey, whose business became the building block for Computing-Tabulating-Recording (C-T-R) company (IBM Chronological History, 2014). In 1889, the first recording company was incorporated as the Bundy Manufacturing Company, which later became a key component of C-T-R. During the 1890s, the U.S. Census Bureau requirement in the late 19th century for a more efficient means of tabulating census data, in order to deal with the wave of new immigrants during the height of the Industrial Revolution (IBM Chronological History, 2014). Herman Hollerith, son of German immigrants and Census Bureau statistician, invented a Punch Card Tabulating Machine which used an electrical current to sense holes punched in punched cards, while keeping a running total of data, replaced the U.S. government agency’s traditional counting methods.  In 1896, Hollerith formed the Tabulating Machine Company in 1896, in order to capitalizing on his success (IBM Chronological History, 2014).

IBM would eventually be incorporated in the State of New York on June 16, 1911. A consolidation of the Computing-Tabulating-Recording Company (C-T-R), Computing Scale Company of America, the International Time Recording Company of New York, and Hollerith’s Tabulating Machine Company would make up the International Business Machine Company (IBM Annual 10-K Report, 2014).

Since its inception, IBM’s business model has focused on bridging the gap between business insight and technological innovation with a global perspective. Thomas J. Watson Jr. was born in 1914, at the time his father was the head of IBM. Some 42 years later, Thomas Junior succeeded his father in leading the medium sized company to become an industry giant. According to Hartley (2011, p. 78) by 1946, IBM would become the largest computer maker in the world with steadily growing revenues to become the bluest of blue-chip companies. Under Chief Executive Officer, Watson Jr.’s leadership, IBM ranked first among all U.S. firms in market value by 1989. By 1991, revenues approached $67 billion, with an employee base of over 350,000 employees worldwide (Hartley, 2011, p.78). One of IBM’s greatest assets was its research labs, with three Nobel Prize winners serving within its staff, all complemented with an extensive budget coming from 10 percent of sales ($6.6 billion in 1991) (Hartley, 2011, p.78).  CEO Thomas J. Watson Jr. would end up serving 19 years as CEO, and retiring in 1992.