Shanay Mehta

Innovation is the ability to optimize, realize and adapt to changing trends, customer needs,
adjust mindsets and streamline practices to lead to short term and its cumulative effort
coupled with productivity to lead to long term sustainable survival and then growth.

Taking about innovation in its truest sense, and how all of us and take inspiration, that no
matter how many flaws a company has, in its ethos, practices and processes, it can be
revolutionized,
streamlined and made into a mega giant successful firm.
The example of IBM, how it was at the verge of failure and downfall and how a change in
approach led (innovation) , led to the company being alive and one of the most valuable
companies today.
Decline of profit margins due to falling customer interest in the mainframe computers. The
failure was encapsulated into 2 major blind spots and lapses in judgement.
Primarily, IBM’s major funds should have been dedicated to the greatest potential product,
the microcomputer rather IBM focused on the present product that was about to hit a glass
ceiling. In the 1970s, the future dictated the emergence of personal computers, networks and
computer servers however, they invested into building a larger mainframe, immobile and
soon to be obsolete.
Secondly, IBM wronged their fundamentals, they deprioritized their customers, their interests
and lost touch with their concerns.
The promise IBM made previously was to provide high quality technology, service support
maintained by a close continuing and deepening relationship with their customers. To the
employees they promised security, great benefits, competitive salaries, and excellent working
conditions. During the early 90’s they broke both promises, their arrogance led them to
believe that they could force sales to happen by size and hence, sidelined the customer intent,
concern and interest. Furthermore, gave them equipment that didn’t work well, late delivery
and were slow to catch up to the emerging technologies.
Damaging the brand image to a major extent and loss in market share that seemed to be
irrecoverable. On the other hand, the managers let people to believe that security had very
little relation with performance, being over tolerant of poor performer, firing the workers to
increase budgets for over ambitions expansion plans.
Shanay Mehta

The question that arises is that a $100 Billion firm, failing to capitalize on future trends and
give up major potential growth opportunities to Microsoft and intel while it retained a soon to
be obsolete wing?
The few reasons that can be delineated are: An overambitious approach based on an overly
optimistic and proud outlook rather than realism and a real time Return on investment
analysis. Furthermore, an inability to allocate funds where demand is high, a high blinding
arrogance hindering opportunism. Moreover, An Inability to read the future and the customer
trends arising that would shape the future. Lastly, losing focus from employee happiness and
unresolved crisis that became lethal due to untimely handling of such problems.

How they came out of this problem?

A new approach. Establishing the “One IBM” Philosophy, setting a strong vision for the
company as a global information business and allowing them to strategies about the new
upcoming industries to foster opportunism and dynamism. Furthermore, it started recognizing
its strengths and weaknesses, accepting blind spots and actively and urgently seeking
solutions. Furthermore, to develop a language for innovation and growth via adopting a
Model developed in the alchemy of growth.

Diagram for the 3 horizon Model to be followed.

This model helped encapsulate, streamline and articulate the timeframes, goals and growth
efforts to develop, optimize and sustain their potential impact for IBM.
Shanay Mehta

Additionally, for an organic change, creating environments conducive for long term emerging
business opportunities. The leadership worked to strengthen and develop appropriate talent,
culture and performance, that aligned with the companies’ vision and goals. Moreover,
become great at Zooming into current opportunities, seizing them and capitalizing on
customer concerns and demand as well as Zooming out into the long-term exploratory
innovation to be undertaken to yield platforms for long term growth and establishment in
global markets.

Innovation is a timeless principle, aimed at and with employees, future and customers can
cause sever growth.

- Shanay Mehta