Globally Integrated Enterprise

The Globally Integrated Enterprise
Samuel J. Palmisano Chief Executive Officer, Business Perspective

Organization transformation from The Multinational corporation to The Globally integrated enterprisemarks just as big a leap

Corporate Evolution
• Corporation- creature of state • Mid-19th century-emergence of international corporation • 2nd phase began in 1914 • Spread of protectionism 1920s & 1930s lead to evolution of MNC • MNC Hybrid

Corporate Evolution
• MNC Hybrid
– Adapted trade barriers by building local production – Performed tasks like R&D on a global basis

• Important changes – last 3 decades
– Economic nationalism abated – IT revolution standardized technologies and business operations

Samuel J. Palmisano, the Chair of the Board, President, and CEO of IBM: • “Today’s global corporations are shifting their focus from products to production-from what things companies choose to make to how they choose to make them, from what services they offer to how they choose to deliver them. Simply put, the emerging globally integrated enterprise is a company that fashions its strategy, its management, and its operations in pursuit of a new goal: the integration of production and value delivery worldwide. ”

Global Integration
• THE SHIFT
– Changes in where companies produce things – Changes in who produces them

• Economic activity turning outward embracing shared business and Tech standards

Global Integration

Systemic Changes
• Premium comes from fusion of invention and insight into how to transform how things are done. • Integration of Information and networking technologies • Managing operations, expertise & capabilities  connecting partners, suppliers & customers

Systemic Changes
• Example : Extraordinary growth of service firms

Opportunities and Challenges
• Opportunities
– – – – Raising living standards Improving working conditions Creating jobs Creating infrastructure

• Challenges
– Supply of High value skills – Sensible regulation of intellectual property
• Issues like privacy deprive individual inventors • Collaboration –key feature contemporary innovation

Opportunities and Challenges
• Challenges
– Maintaining trust in distributed business models – Significant changes in organizational culture, segments of society – Patience and understanding from stockholders – Global security and order

Global Collaboration
• Moving towards global stability • Left unaddressed, discontent will grow • Promising new actor on the world stage

Dhanyawaad

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