How does IBM make money?

Introduction:

IBM (International Business Machine Corporation), a multinational technology corporation which is headquartered in Armonk, New York. IBM covers its establishment all over the world by holding operations in & around 175 countries. In the beginning, when IBM started the original name was Computing-Tabulating-Recording Company (CTR), it was in the year 1911 at Endicott, New York. In 1924, the company name was renamed from Computing-Tabulating-Recording Company (CTR) to International Business Machine (IBM). Here, we’ll know How does IBM make money?

Answer:

During the 1880s, technology took a great approach which helped us to see an immensely developed IBM company. As Julius Pitrap invented & got patented the first-ever computer scale in 1885, Alexander developed the dial recorder in 1888, Electric the Tabulating machine was got patented to Herman Hollerith during 1860-1929, time clock inventor Willard Bundy & Charles Ranlett Flint, the all five of them amalgamated for developing new company called Computing-Tabulating-Recording Company (CTR).

They all began to manufacture machinery for sales & lease, list of the machinery was commercial scales, industrial time recorders, meat & cheese slicer, tabulators & punched cards. During this period Thomas J. Watson, Sr joined as general manager then he was given a president post in Computing-Tabulating-Recording Company (CTR). During Watson’s supervision, just within the first four years revenue of CTR reached $9 million & also during this period the company reached Europe, South America, Asia & Australia.

Thomas J. Watson was never satisfied with the company name Computing-Tabulating-Recording Company (CTR) so he changed the company name to International Business Machine Corporation (IBM) on February 14, 1924. So, from then the new era of IBM started & it just grew & grown till today it has self-marked the industry.

What is the motive of the IBM organization?

International Business Machine Corporation (IBM) has a vision & mission of making the forthcoming generation live & work with comfort in the aspects of technology. IBM is moving towards the vision of acquiring leadership all over the world by developing new information technology and making it work in the present technology situations. IBM is continuously striving to give the technology industry a new invention so that the world can work in hassle-free conditions.

International Business Machine Corporation (IBM)’s vision statement states that

IBM wants to be the most successful & important information technology company, concerning all over the world company’s competition.
IBM wants to be successful in the manner of helping out customers to apply technology to solve their problems.
IBM wants to be successful in introducing new & extraordinary technologies to new customers.
IBM wants to continue to be the basic resource of however much of what is invested in the technology industry.

International Business Machine Corporation (IBM)’s mission statement states that

IBM wants to lead in the creation, development & manufacture of information technologies & to come up with advanced inventions in the sectors like computer systems, software, networking systems, storage devices & microelectronics.
Worldwide networks of IBM solutions & professionals will constantly strive for translating advanced technologies into business values for customers & their benefit.
IBMers translate the advanced technologies to valuable results for the customers through professional solutions, services & consulting businesses worldwide.

International Business Machine Corporation (IBM)’s values state that

Be dedicated to every client’s resultant success:

IBMers always is & always will strive to give more than better-desired results to the clients. IBM follows these values for every client’s need because IBMers feel that it is not all about what we get from the client but it is mostly about what quality & valuable results we give to the clients.

It is a success for both IBMers & clients. So, IBM employees always work dedicated to achieve success for IBM & give success to clients.

Present innovations to our company & for the world:

As IBM is constantly in the battle of innovating something new to present to self & also for the world. Innovating something new will always take a lot of dedication & a strong determination.

And IBM is here with both attributes because innovation is something that excites the IBMers. This excitement will always make IBMers present the world with new inventions to make the users or customer’s life easier & better.

Attain Trust & Follow personal responsibility in all relationships:

IBM always had trust in clients, employees & customers. And IBM always tries to attain trust by fulfilling the needs of the real-world issues, let it be of a client or a customer.

IBM always follows the responsibility of giving the best to whatever relationships they are connected to like employees, clients & customers.

How IBM achieved a worldwide approach?

International Business Machine Corporation (IBM) is also known as “Big Blue”. But, the mystery behind the naming International Business Machine Corporation (IBM) as Big Blue is still unrevealed.

International Business Machine Corporation (IBM) is one of the worlds’ largest Information technology companies. IBM provides a large range of hardware, software & services offers. In the beginning, IBM had a start with developing hardware products & also achieved great success in the hardware field by supplying mainframe computers to a large extent. And this success was on the on-go for several decades.

Then after it begins a new journey by stepping into the field of software & services. Near to 2010, IBM started to emphasize fields like cloud-based services & cognitive computing. Then after IBM just took an interest in much more new technologies to develop.

Products offered by IBM

IBM products in the Analytics sector:

Watson Assistant: IBM Watson Assistant helps customers with fast & accurate answers irrespective of any application, device, or channel.
IBM Cognos Analytics: Presents hidden insights of user data & helps users or organization’s to increase their growth factors.
IBM Planning Analytics: An AI-pervaded integrated planning solution will help users to exceed the limits of manual planning.
Mobile Analytics: IBM Mobile Analytics is a cloud service that helps users to monitor the usage of all user applications from their desktops or tablets.

And there are more products available in the Analytics sector like IBM Spectrum Discover, IBM File Transfer service, IBM File Manager for z/OS, IBM SPSS statistics, etc. These all products help users or organizations to function various Analytical works.

IBM products in the Block-chain sector:

Develop & utilize block-chain networks, to reduce risk & open up new revenue streams. Some block-chain products are-

IBM Food Trust.
IBM LinuxONE III.
IBM Digital Health Pass.

IBM products in the Business Operations sector:

Enables organizations to optimize efficiency by using these solutions. Some of the IBM Business Operations products are-

IBM Cognos Dashboard Embedded.
IBM Digital Twin Exchange.
Watson Explorer.
IBM Robotic Process Automation.
IBM Storage Insights.
IBM Spectrum Scale.

And there are more products available to ease the Business Operations of an organization by using these information technologies.

IBM products in the Cloud Computing sector:

Enable on-demand access to shared computer processing resources & data. Some of the IBM Cloud Computing products are-

IBM Debug for z/OS.
IBM Developer for z/OS.
IBM Watson Knowledge Studio.
IBM Application Delivery Foundation for z/OS.
IBM Sterling Store Engagement.
IBM Power System S924.
IBM Sterling Supply Chain Insight with Watson.
IBM Security Verify for Customer IAM.
IBM Sterling Transaction Manager.
IBM Spectrum Control.

More products are available under the IBM Cloud Computing sector.

IBM Cyber Security:

Protecting the data of computing assets of a user or an organization is one of the most important things for every organization, So, IBM Cyber Security had come up with cybersecurity products like-

IBM Cloud Pak for Security.
IBM Security verifies for Consumer IAM.
IBM Q-Radar Log Manager.
IBM Q-Radar on Cloud.
IBM Q-Radar Data Store.
IBM Q-Radar User Behavior Analytics.
IBM Security SOAR.
IBM Q-Radar Incident Forensics.
IBM Fault Analyzer for z/OS.
IBM Power System S924.

IBM had invented more products with more functionalities. So, IBM is striving to make the world hassle-free security from cyber-attacks.

There are also other sectors available with advanced products like IBM Consulting Services, IBM IT Infrastructure, IBM Industries & IBM Supply Chain.

Services offered by IBM:

IBM offers services for developing well-planned strategies for the company or organization. IBM services include:

Application services.
Business continuity services.
Business consulting services.
Hybrid cloud consulting & services.
Design & Business strategy.
Network Services.
Security services.
Technology support services.
Talent management services, etc.

So, from the beginning of the computer era to the present technology improvement, in between all these decades, most or every organization or company has used the technologies developed by IBM. And it is still in the process. The above-given products & services are constantly used by every organization to make their future better.

And this made IBM spread its wings to every corner of the world. These made IBM get a worldwide approach.

What is an IBM money earning source?

International Business Machine Corporation (IBM) sells the above-listed products to the company & also presents various services for an organization. Like Information Technology services, cloud & cognitive offerings, artificial intelligence, etc. IBM has covered clients in around 175 countries or more than that. These increase the range of competition for IBM let it be a small or largely famous company. Companies like Alphabet Inc., Cisco Systems Inc., Microsoft Corp, Amazon.com Inc., etc are the major competitors for IBM. But IBM takes this competition as a motivation to grow more & more.

And this motivation results in the earnings of IBM. As per the report of IBM’s FY 2020 earning states that

The Global Technology Services segment was IBM’s biggest revenue source. Revenue for these segments fell by 5.7% in FY 2020 that is about $25.8billion. But it still holds the largest share of IBM & it has total revenue of over 35%.
Cloud & Cognitive software was the most profitable for IBM.

Cloud & Cognitive software segment revenue had grown by 2.1% in FY 2020 as compared to past reports. And it was around $23.4 billion, which was around 32% of IBM’s total revenue.

They have other segments also like Global Business Services, Systems & Global Financing which generates the earnings for IBM.

IBM segment breakdown based on FY 2020 in percentage would be like

Global Technology Services presents organization and IT infrastructure & platform services, also hybrid cloud services & solutions adding up to it. Global Technology Services generated a revenue of around 35% of overall revenue.
Cloud & Cognitive software joint’s IBM’s software platforms & solutions to deliver hybrid cloud service which will help clients to predict, automate & modernize their business. Cloud & Cognitive software generated a revenue of around 32% of overall revenue.
Global Business Services presents organizational services like consulting, business process & application management. This helps clients or companies to build AI-enabled intelligent workflow & to modernize applications that will suit in optimizing a hybrid cloud environment. Global Business Services generated a revenue of around 22% of overall revenue.
The systems sector presents an infrastructure platform to achieve new requirements of hybrid multi-cloud & enterprise AI workloads. The systems segment generated a revenue of around 10% of overall revenue.
The Global Financing segment occupies the fields like financing, remanufacturing & remarketing. Global Financing generated a revenue of around 2% of overall revenue.

The above-given information about IBM services & products is the earning source for a company. The different segments available in IBM helps to generate revenue for a company.

IBM itself stated that in FY 2020, the company had a profit of $5.6 billion where overall revenue in the year 2020 was $73.6 billion. 46% of revenue was generated in America, 32% from Europe, Middle East & Africa & remaining 22% was from the Asia Pacific.

What is the revenue growth rate of IBM?

IBM had a great hype in revenue in the year 2011 & that was $106.9 billion. This was the highest revenue of IBM in its whole career.

Below given are the IBM revenue growth details of its past 2 decades from 2001-2020.

In 2001, IBM had revenue of $83.0 billion.
In 2002, IBM had revenue of $81.1 billion.
In 2003, IBM had revenue of $89.1 billion.
In 2004, IBM had revenue of $96.2 billion.
In 2005, IBM had revenue of $91.1 billion.
In 2006, IBM had revenue of $91.4 billion.
In 2007, IBM had revenue of $98.7 billion.
In 2008, IBM had revenue of $103.6 billion.
In 2009, IBM had revenue of $95.7 billion.
In 2010, IBM had revenue of $99.8 billion.
In 2011, IBM had revenue of $106.9 billion.
In 2012, IBM had revenue of $104.5 billion.
In 2013, IBM had revenue of $98.3 billion.
In 2014, IBM had revenue of $92.7 billion.
In 2015, IBM had revenue of $81.7 billion.
In 2016, IBM had revenue of $79.9 billion.
In 2017, IBM had revenue of $79.1 billion.
In 2018, IBM had revenue of $79.5 billion.
In 2019, IBM had revenue of $77.1 billion.
In 2020, IBM had revenue of $73.6 billion.

Conclusion:

IBM is not a small game player in the industry. From the year 1911 to the present year, IBM always took a stand & established itself as one of the top companies in the worldwide competitive industry.

Because IBM is constantly in the race of developing new technologies in the IT field. The success of IBM is one of the results of the following vision, mission & value statement itself. And only because of these IBM is inventing one on one new products, which is also helping other companies to grow by using the products & services offered by IBM.

As of now, IBM is specialized in Computer hardware, Computer software, Consulting & IT Services. Maybe in the future IBM is going to come up with new technologies that the world will get gifted from the IBM team.

Frequently Asked Questions

1. What benefits does IBM offer to an employee?

Answer: IBM is a reputed company. It is because IBM always respects the employee as well as clients. So, there is an ongoing list of benefits of working in IBM. Like health, vision, dental, 401K, health saving plan, etc. The flexible working hours are also the biggest advantage of working in IBM.

2. How does IBM pay the salary for an employee?

Answer: IBM pays an employee salary twice a month. The first salary in the first 15 days of the month & the last in the last 15 days of the month. On the 15th date of the month & last date of that month is the procedure of paying an employee a salary.

3. Why do people like to work at IBM?

Answer: IBM is a very good company & also has great work culture, advanced & regular training for employees. Employees can easily manage work-life balance. IBM is a very professional & maturely managed company. This makes people strive to get a job at IBM. The benefits the company provides are appreciable.

4. Is it fun to work at IBM?

Answer: As IBM provides flexible working hours for an employee, this makes employees love their job. Employees can acquire great knowledge in aspects other than their job like learning the working process of other field works. Employees can learn about various technologies & also get to know about future projects of IBM. Employees can contribute their knowledge if needed, if the suggestion is right then getting rewarded is also worth it.